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All-in-One CISA® Certified Information Systems Auditor: Exam Guide, Second Edition by Peter Gregory

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Mitigating Outsourcing Risk

The only means of exchange between an outsourcing provider and its customer organization are money and reputation. In other words, the only leverage that an organization has against its outsourcing provider is the withholding of payment and communicating the quality (or lack therein) of the outsourcing provider to other organizations. This is especially true if the outsourcing crosses national boundaries. Therefore, an organization that is considering outsourcing must carefully consider how it will enforce contract terms so that it receives the goods and services that it is expecting.

Many of the risks of outsourcing can be remedied through contract provisions. Some of the remedies are

Service level agreement (SLA) ...

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