WHY IS THE SALE CONTRACT IMPORTANT?
A timber sale contract is the most important document involved in conducting a timber sale. It could make or break the deal for all parties involved if not prepared with caution and expertise. Great care should be taken while preparing the contract. Ideally, the services of an attorney and an expert forestry consultant who is aware of the used industry standards. Even after you have entered into a contract, it is important to make sure all parties are complying with it and there is no breach of any kind related to insurance, safety, and/or environmental requirements.
How Does a Contractor Audit Work?
A contractor audit ensures that everything stipulated in the contract is being followed by the contractor. Let’s take a look at exactly how a contractor audit works and what compliance verifications are necessary:
1. Insurance –The auditor verifies that the contractor is working within the limits of the insurance plan he has obtained for the contract. Provisions for liability and insurance protect the seller from any liability arising from the contractor’s harvesting operation. The contractor is required to show proof of its employee’s compensation and public liability insurance.
2. Contract – The audit ensures that all provisions made in the contract are being followed. The auditor checks that the beginning and ending dates of the contract are in accordance with the speed of operation and there are no unnecessary delays. It is made sure that the products being harvested are the ones agreed to in the contract. Verification of adherence to the harvest area as agreed in the contract is also undertaken.Another important point to verify is the time that the payments are made by the purchaser to the seller. Cut products can only be transferred from the property once the payment has been made by the contractor as agreed in the contract.
3. Safety – Contractor audit verifies that the purchaser is complying with all Occupational Safety and Health Act(OSHA) requirements for all employees as well as equipment on working on the tract. The auditor makes sure that all safety precautions procedures stipulated in the contract are being followed. Auditor verifies that all the staff working on the site and operating the equipment holds appropriate training certifications issued by the relevant authorities.
4. Environment –Auditor verifies that the contractor is abiding by all environmental protection standards. Adequate measures for avoiding soil erosion, stopping hazardous materials from entering waterways, protecting streams, keeping the harvest operation within the stipulated area with harming adjacent tracts, should all be ensured while performing a contractor audit.
How Can a Contractor Audit Help?
Dendro Resource Management has years of experience working in the timber industry which has enabled us to gain all the tools and tricks of the trade to carry out a comprehensive contractor audit wherever needed.This can benefit a company greatly by making sure all contractors are staying safe on the job.
If you are a forester, producer or a company looking to conduct a contractor audit that leaves no stones unturned and follows the best practices, we are here for you. Get in touch with us today and one of our audit experts will be there to assist you!