| Contract clause / area | Document to request | Test performed | Typical finding |
|---|---|---|---|
| Pricing schedule & labour rates | Rate card plus timesheets or work orders | Reconcile the billed rate to the contracted rate, by trade and tier | Journeyman rate billed for apprentice-level work |
| Subcontractor markups | Subcontractor invoices and the markup clause | Recalculate the markup against the contracted percentage | Markup applied above the contracted ceiling |
| Change orders & scope | Change-control log and signed approvals | Trace each change order to an authorised approval | Scope change actioned without the required sign-off |
| Insurance & compliance | Certificates of insurance and licences | Confirm currency and coverage limits against the contract | Certificate expired mid-term and never renewed on file |
Insights
The 90-Day Facilities Management Contract Audit
An outsourced facilities management contract audit can run in a fixed 90-day window without disrupting service: discovery, evidence, then a findings register ranked by money and risk, ending in one decision memo for the executive committee.
September 29, 2026 · Patricia Karchemny · 8 min read
Are You Getting What You Pay For? Part 2 of 2
Why an independent audit, and why 90 days
If an outsourced facilities contract goes largely unread once it is signed, the practical question is what to do about the one already running in your organisation today. An independent audit is one answer: a fixed, time-boxed review of what the contract says, what is actually being delivered, and where the two have drifted apart — run without disrupting service, and without adding permanent headcount.
The method below breaks a facilities management contract audit into three fixed 30-day phases — discovery, evidence, and findings and decisions — each ending in a defined deliverable rather than an open engagement that drags on until someone loses patience. Figure 1 lays out the cadence and the gate at the end of each phase.
Phase 1, days 1–30: discovery — what a facilities management contract audit reviews first
Discovery has one job: assemble a complete, current evidence base before anyone forms an opinion. That means the master agreement and every schedule attached to it — service-level agreements, the pricing schedule, change orders, the history of price adjustments — plus the last twelve months of invoices and the supplier’s own performance reports. It also means mapping contracted scope to actual sites, since a portfolio that has grown or shrunk since signing rarely has a contract that grew with it, and confirming who on the client side can actually sign off a change order, a credit or a renewal. Nothing here requires the provider to stop working; it requires someone on the client side to ask for documents the contract already entitles them to see.
Phase 2, days 31–60: evidence — testing what is invoiced against what is owed
Evidence is where the audit stops reading the contract and starts testing it: invoices checked line by line against the pricing schedule; a sample of work orders checked against the supplier’s own reported KPIs; a sample of sites walked in person; site leads and the provider’s account team interviewed separately, so their accounts can be compared rather than assumed to agree; scope changes reconciled against the change-control record rather than the supplier’s summary; insurance and compliance certificates checked for currency, not just existence. A 2021 review of the City of Toronto’s Corporate Real Estate Management Division tested at close to this scale — 250 invoices in detail, roughly 1,500 more through data analytics, on invoices issued between 2013 and 2020 — a useful illustration of what testing, rather than accepting, a supplier’s numbers can surface.
| Role | What to ask |
|---|---|
| Site lead (client side) | What does the reported KPI look like in practice on this site, and what evidence exists beyond the supplier's own report? |
| Provider's account manager | Walk through how a KPI is measured and reported, end to end, from raw data to the published number. |
| Procurement lead | What is the process for approving a scope change or a price adjustment, and who has authority to sign it? |
Phase 3, days 61–90: findings and decisions
The third phase turns testing into a findings register, ranked by money and risk rather than by the order issues were discovered. Some findings are quick wins: a billing correction, a piece of dormant scope nobody is using or has cancelled, a certificate that needs renewing. Others are structural — KPI design, or a pricing model that rewards the wrong behaviour — and are worth naming without trying to solve them inside a 90-day audit; they belong to later articles in this series. What the audit owes the executive committee is a short decision memo: fix in place, renegotiate specific terms, or plan a structured re-tender. The latter two are bigger conversations than a 90-day window can finish and belong to their own articles — the audit’s job is to tell you which conversation you actually need to have, with evidence rather than a supplier’s assurance that everything is fine.
Three governance principles worth insisting on
Three principles decide whether the audit is worth doing at all. Evidence over opinion: every finding traces to a document or a test, not an impression formed on a walkthrough. Capability transfer: the client’s own team runs the review alongside the auditor and owns the findings register afterward, so the next check-in does not require hiring the same outside help again. Independence: the reviewer earns nothing from the contract under review or from whatever replaces it — no commission, no referral fee, no stake in a renegotiation or a re-tender. The governance framework a contract sits inside and the audit that tests it reinforce each other; neither substitutes for the other. Internal auditors make a related point about vendor oversight generally: a contract can give the client the right to assess a major subcontractor directly, rather than relying only on the prime contractor’s own account — worth confirming your own contract has that clause before assuming an audit can go as far as it needs to.
If your organisation has never tested an outsourced facilities contract against its own evidence, a confidential conversation is a reasonable way to scope what a 90-day audit would look like for your portfolio.
Key takeaways
- A facilities management contract audit can run as a fixed 90-day engagement — discovery, evidence, findings and decisions — without disrupting service.
- Evidence beats opinion: invoices tested against the pricing schedule and work orders tested against reported KPIs, not a summary the supplier wrote about itself.
- Findings split into quick wins, structural issues for later work, and a short decision memo: fix in place, renegotiate, or plan a re-tender.
- The review only holds up if the reviewer has no stake in the contract’s outcome, and if the client’s own team can run the next one.
Frequently asked questions
How long does a facilities management contract audit take?
A structured review can be scoped as a fixed 90-day engagement — roughly 30 days each for discovery, evidence, and findings and decisions — run alongside the contract’s normal operation rather than pausing it.
Do we need the provider’s consent to audit an FM contract?
Generally, no, beyond what the contract already grants: most outsourced-services agreements include audit or inspection rights letting the client request records and test performance without renegotiating anything. What varies is scope — whether that right reaches a subcontractor directly, how much notice is required, how often it can be exercised — so confirm the specific clause with counsel before assuming how far the review can go.
What does a facilities management contract audit typically find?
Patterns vary by portfolio, but audits of outsourced service contracts have turned up billing that does not match the rate card, subcontractor markups outside the contracted terms, scope changes without the required sign-off, and performance reported only through a supplier’s own summary. None of that is necessarily fraud; more often it is years of nobody checking.
Who should run the 90-day audit?
An independent reviewer with no stake in the contract’s outcome or its replacement, working alongside — not instead of — the client’s own facilities, procurement and finance teams, so the next review stays in-house.