Contract clause library

Audit hours clause: Copy, customize, and use instantly

Introduction

An audit hours clause outlines the specific number of hours allocated for auditing purposes under an agreement. It defines how many hours can be spent by one party (typically the client or an independent auditor) to review the other party's records, processes, or performance, and it may specify how these audit hours are to be scheduled, compensated, or reported. This clause ensures transparency and sets clear expectations for both parties regarding the audit process.

Below are templates for audit hours clauses tailored to different scenarios. Copy, customize, and insert them into your agreement.

Standard audit hours clause

This version provides a general framework for audit hours.

The Parties agree that [Party A] shall have the right to audit [Party B]’s records, processes, and performance for a maximum of [X] hours per calendar year. The audit shall be scheduled in advance and conducted during regular business hours, with [Party B] providing access to all relevant records and documents.

Audit hours clause with provision for additional hours if necessary

This version allows for additional hours.

The Parties agree that [Party A] may audit [Party B]’s records and performance for up to [X] hours per year. If additional audit hours are required due to the complexity of the audit or non-compliance, both Parties will mutually agree on any additional hours needed, which will be billed at an agreed-upon rate.

Audit hours clause with provision for hourly compensation

This version includes compensation for audit hours.

[Party A] shall be entitled to audit [Party B]’s records for a maximum of [X] hours per year. Any audit hours exceeding this limit will be billed at an hourly rate of [X], with both Parties agreeing to the audit schedule and scope in advance.

Audit hours clause with provision for notice period

This version includes a notice period for audits.

The Parties agree that [Party A] may audit [Party B]’s records for up to [X] hours per calendar year. [Party A] shall provide [Party B] with at least [X] days' written notice prior to any audit, and the audit shall be conducted during regular business hours at [Party B]’s premises or via remote access.

Audit hours clause with provision for limiting audit scope

This version limits the scope of the audit.

The Parties agree that [Party A] is entitled to audit [Party B]'s records for a total of [X] hours per year. The scope of the audit will be limited to [specific records or areas of performance], and any additional audit requirements will be subject to prior mutual agreement.

Audit hours clause with provision for pre-scheduled audits

This version includes pre-scheduled audits.

The Parties agree that [Party A] will be allowed to conduct an audit of [Party B]’s records for up to [X] hours each year. These audits shall be pre-scheduled at least [X] weeks in advance, and both Parties will agree on a mutually convenient time to conduct the audit.

Audit hours clause with provision for remote audits

This version allows for remote audits.

[Party A] is entitled to audit [Party B]’s records for a maximum of [X] hours per year. The audit may be conducted remotely, provided [Party B] ensures access to all necessary records and documents via digital platforms, unless a physical audit is mutually agreed upon.

Audit hours clause with provision for quarterly audits

This version allows for quarterly audits.

The Parties agree to allow [Party A] to conduct up to [X] hours of audit per quarter. Each audit will focus on specific performance indicators or financial records, with the goal of ensuring compliance with the terms of this Agreement.

Audit hours clause with provision for annual report

This version requires an annual report.

[Party A] may conduct audits for up to [X] hours annually. After each audit, [Party A] will provide a report summarizing the findings, including any discrepancies or recommendations for corrective actions, to be delivered within [X] days of completing the audit.

Audit hours clause with provision for mutually agreed auditor

This version involves a mutually agreed auditor.

The Parties agree that any audit of [Party B]’s records, up to a maximum of [X] hours annually, will be performed by an auditor mutually agreed upon by both Parties. The auditor will conduct the audit at a time agreed upon in advance, ensuring minimal disruption to business operations.

This version includes shared audit costs.

[Party A] may audit [Party B]’s records for up to [X] hours per year. Any costs associated with the audit, including fees for auditors or third-party consultants, will be split equally between the Parties unless otherwise agreed.

Audit hours clause with provision for audit notification and access

This version includes notification and access requirements.

[Party A] may request to audit [Party B]’s records for a total of [X] hours per year. [Party A] will provide [Party B] with written notice at least [X] days in advance, and [Party B] will ensure that all relevant documents and records are accessible during the audit.

Audit hours clause with provision for limitations on sensitive data

This version limits access to sensitive data.

The Parties agree that [Party A] may audit [Party B]’s records for up to [X] hours per year. However, [Party A] will not have access to any sensitive or proprietary data unless mutually agreed upon in writing by both Parties, or required by law.

Audit hours clause with provision for audit scheduling flexibility

This version includes scheduling flexibility.

[Party A] is entitled to audit [Party B]’s records for a maximum of [X] hours each year. The Parties will schedule the audit at a mutually convenient time, with [Party B] having the option to propose alternative dates within [X] days of the initial proposed schedule.

Audit hours clause with provision for follow-up audits

This version includes follow-up audits.

[Party A] may audit [Party B]’s records for up to [X] hours annually. If the audit reveals discrepancies or non-compliance, [Party A] reserves the right to conduct a follow-up audit, limited to [X] additional hours, to verify corrective actions.

Audit hours clause with provision for partial audits

This version allows partial audits.

[Party A] may audit [Party B]’s records for a total of [X] hours per year. The audit may be conducted in phases, focusing on different areas of the business at different times, as agreed upon in advance by both Parties.

Audit hours clause with provision for data security compliance

This version ensures compliance with data security.

[Party A] may audit [Party B]’s records for up to [X] hours per year, provided that all audits are conducted in compliance with applicable data security and privacy laws. Both Parties will ensure that any data reviewed during the audit is protected according to the applicable regulations.

Audit hours clause with provision for access to third-party contractors

This version includes access to third-party contractors.

[Party A] may audit [Party B]’s records for a total of [X] hours per year. [Party B] will allow [Party A] access to its third-party contractors, if applicable, to verify performance or records related to the Agreement, provided the third-party contractors have agreed to cooperate.

Audit hours clause with provision for audit delay

This version allows for audit delay.

[Party A] may audit [Party B]’s records for up to [X] hours annually. If, due to unforeseen circumstances, the audit is delayed, the Parties will agree to reschedule the audit within [X] days of the originally scheduled date, without penalty.

Audit hours clause with provision for audit transparency

This version includes transparency in the audit process.

[Party A] may audit [Party B]’s records for up to [X] hours per year. [Party B] agrees to provide transparent access to all requested documents, and to fully cooperate with the audit process, ensuring no material information is withheld during the audit.

This version adjusts cost-sharing based on findings.

[Party A] may audit [Party B]’s records for up to [X] hours annually. If the audit reveals discrepancies or issues that require additional work, the Parties agree to share the costs for the resolution of such issues, with the costs allocated based on the severity of the discrepancies.

Audit hours clause with provision for online access

This version allows for online access.

[Party A] may audit [Party B]’s records for up to [X] hours per year. If applicable, the audit can be conducted online through secure digital platforms, with both Parties agreeing on the access method and security protocols to ensure confidentiality.

Audit hours clause with provision for audit of subcontractors

This version allows audit of subcontractors.

The Parties agree that [Party A] may audit not only [Party B]’s records but also those of any subcontractors involved in the performance of this Agreement. These audits will be limited to [X] hours per year and will require prior written notice to both [Party B] and the subcontractors.

Audit hours clause with provision for summary of audit results

This version requires a summary of results.

After completing an audit of [Party B]’s records, [Party A] shall provide a summary of the audit results, including any discrepancies or non-compliance identified. This summary will be delivered within [X] days of the completion of the audit and will include recommendations for corrective actions if necessary.

Audit hours clause with provision for periodic audit schedule

This version allows for a periodic audit schedule.

The Parties agree that [Party A] is entitled to audit [Party B]’s records for a total of [X] hours each year. The audit will be conducted on a periodic schedule, with specific times determined in advance based on mutual availability and project requirements.

Audit hours clause with provision for audit of specific areas only

This version limits the audit to specific areas.

[Party A] may audit [Party B]’s records for up to [X] hours per year, with the audit limited to specific areas outlined in [Exhibit A]. The scope of the audit will focus on the areas agreed upon in advance by both Parties.

This version involves sharing third-party audit reports.

If a third-party auditor is involved, the audit hours allowed under this Agreement will be capped at [X] hours annually. The third-party auditor’s final report will be shared with both Parties within [X] days of the audit’s completion.

Audit hours clause with provision for notice of audit hours spent

This version requires notification of audit hours spent.

[Party A] is entitled to audit [Party B]’s records for up to [X] hours each year. [Party B] will be notified if the audit exceeds [X] hours, and any additional hours will be billed at an hourly rate of [X], unless otherwise agreed upon in writing.

Audit hours clause with provision for additional hours due to discrepancies

This version allows for additional hours based on discrepancies.

The Parties agree that [Party A] may audit [Party B]’s records for up to [X] hours annually. If discrepancies are found during the audit that require further investigation, the Parties may agree to extend the audit for additional hours at an agreed rate.

Audit hours clause with provision for maximum annual audit hours

This version sets a maximum for annual audit hours.

The Parties agree that the total number of audit hours per year shall not exceed [X] hours. If more audit hours are required, both Parties must agree on the additional time and compensate [Party B] accordingly, as agreed in writing.

This version includes audit-related cost reimbursement.

[Party A] is entitled to audit [Party B]’s records for a maximum of [X] hours per year. If the audit requires additional resources, including third-party assistance, the Party requesting the audit will reimburse [Party B] for any reasonable costs incurred in the process.

Audit hours clause with provision for impact on project timelines

This version ties audit hours to project timelines.

The Parties agree that any audits conducted by [Party A] will be limited to [X] hours annually. If the audit exceeds this time and impacts project timelines, the Parties will adjust the project schedule to reflect the time spent on the audit.

Audit hours clause with provision for prior approval for audit hours

This version requires prior approval for additional audit hours.

[Party A] may audit [Party B]’s records for a maximum of [X] hours per year. Any additional audit hours required beyond this limit will be subject to prior written approval from [Party B], and may be subject to additional costs.

Audit hours clause with provision for reduced hours based on performance

This version reduces audit hours based on performance.

If [Party B] has consistently met the performance standards outlined in [Exhibit A], the annual audit hours may be reduced to [X] hours, as agreed by both Parties, in recognition of [Party B]’s compliance with the agreed standards.

Audit hours clause with provision for flexibility in audit method

This version allows for flexibility in audit methods.

[Party A] may audit [Party B]’s records for up to [X] hours per year, using flexible methods, including physical inspections or remote access to documents. The specific method will be agreed upon by both Parties before the audit is conducted.

Audit hours clause with provision for audit coordination with other audits

This version allows coordination with other audits.

The Parties agree that the audit hours allowed under this Agreement may be coordinated with any other ongoing audits [Party B] is subject to, provided that the combined total audit hours do not exceed [X] hours annually.

This version involves sharing audit documentation.

After each audit, [Party A] will provide a summary of the audit findings, including any discrepancies or compliance issues identified. This documentation will be shared with [Party B] within [X] days of the audit’s completion, along with a proposed corrective action plan if applicable.

Audit hours clause with provision for annual adjustment of hours based on previous audits

This version adjusts audit hours based on previous audits.

The Parties agree to an initial audit period of [X] hours annually. After the first year, the number of audit hours for subsequent years will be adjusted based on the findings of previous audits, with both Parties agreeing on the revised number of hours needed for future audits.

Audit hours clause with provision for agreed-upon schedule

This version specifies an agreed-upon schedule for audits.

[Party A] is entitled to audit [Party B]’s records for up to [X] hours each year. The audit shall occur according to a schedule mutually agreed upon at the start of the year, with both Parties confirming the dates and scope of each audit session in writing.

Audit hours clause with provision for suspending audit if excessive time is spent

This version suspends the audit if excessive time is spent.

If the audit exceeds [X] hours in duration, [Party A] will suspend the audit and consult with [Party B] to determine whether additional time is necessary. Both Parties will agree to the next steps, and any additional hours will be billed at the agreed rate.

Audit hours clause with provision for audit timing flexibility based on operational needs

This version provides flexibility based on operational needs.

The Parties agree to allocate up to [X] audit hours annually. If necessary, the timing of the audit may be adjusted to accommodate both Parties' operational schedules, with the understanding that the audit will be completed within the same calendar year.

Audit hours clause with provision for shared access to audit findings

This version allows shared access to audit findings.

Both Parties agree to the audit hours outlined in [Exhibit A]. Upon completion of the audit, both Parties will share access to the final audit report, ensuring transparency and allowing both Parties to review the findings and take any necessary corrective actions.

Audit hours clause with provision for different rates for different types of audits

This version includes different rates for different audits.

[Party A] is entitled to audit [Party B]’s records for up to [X] hours per year. If the audit requires specialized expertise (e.g., legal, financial), the Parties agree that the audit hours will be billed at a different rate, as specified in [Section X].

Audit hours clause with provision for quarterly audit reports

This version requires quarterly audit reports.

[Party A] is entitled to audit [Party B]’s records for a total of [X] hours annually. Following each audit session, [Party A] will provide a report summarizing the audit findings and performance metrics, due within [X] days of completing each quarterly audit.

Audit hours clause with provision for expedited audits

This version allows for expedited audits.

If required, [Party A] may request an expedited audit of [Party B]’s records, with the audit limited to [X] hours. The affected Party will make reasonable efforts to accommodate the expedited request, and any additional costs associated with the expedited process will be borne by [Party A].

Audit hours clause with provision for training on audit process

This version includes training for the audit process.

Prior to the first audit, [Party B] agrees to provide [Party A] with training on the process and systems that will be audited. The training session will not exceed [X] hours, and both Parties will agree on the schedule for the training.

Audit hours clause with provision for yearly audit plan

This version includes a yearly audit plan.

[Party A] and [Party B] agree to create a yearly audit plan, outlining the specific areas to be audited and the allocation of up to [X] hours per year. The plan will be reviewed and updated annually, with both Parties agreeing to the audit scope and schedule.

Audit hours clause with provision for external audit verification

This version allows external audit verification.

[Party A] may audit [Party B]’s records for up to [X] hours annually. If the audit results are disputed, both Parties agree to allow a neutral third-party auditor to review the findings at no additional cost to either Party.

Audit hours clause with provision for audit of sub-contractors' performance

This version includes subcontractor audits.

[Party A] may audit the records of [Party B] and any subcontractors for up to [X] hours per year. The audit will focus on ensuring that subcontractors are meeting the performance standards set forth in [Exhibit A], and [Party B] agrees to cooperate in providing access to subcontractor records as needed.

Audit hours clause with provision for prorated audit hours

This version prorates audit hours.

The total annual audit hours of [X] are prorated for any partial year. If the Agreement is terminated before the end of the year, the audit hours used will be calculated based on the number of days the Agreement was active, with a maximum of [X] hours.

Audit hours clause with provision for cumulative audit hours

This version allows cumulative audit hours.

The Parties agree to [X] hours of audit time each year. If fewer than [X] hours are used in any given year, the unused hours will carry over to the next year, but the total audit hours used cannot exceed [X] hours within any two consecutive years.

This version requires sharing audit results with stakeholders.

[Party A] may audit [Party B]’s records for up to [X] hours annually. Upon completion of the audit, the results will be shared with relevant stakeholders, including management or investors, provided that confidential information is redacted as necessary.

Audit hours clause with provision for audit scheduling in advance

This version schedules audits in advance.

[Party A] is entitled to audit [Party B]’s records for up to [X] hours annually. Both Parties agree to schedule the audit at least [X] days in advance to ensure that all necessary resources and personnel are available for the audit process.

Audit hours clause with provision for real-time audit updates

This version allows real-time updates during audits.

During the audit, [Party A] will provide real-time updates on the audit findings, sharing any discrepancies or issues identified with [Party B] as soon as they are found. This will allow both Parties to address any issues promptly and avoid delays.

Audit hours clause with provision for pre-audit access preparation

This version includes preparation prior to audits.

Prior to any audit, [Party B] agrees to provide [Party A] with access to the necessary systems, documents, and personnel required for the audit, ensuring that no more than [X] hours are needed for preparation or administrative work prior to the audit.

Audit hours clause with provision for confidentiality during audits

This version ensures confidentiality during audits.

Both Parties agree that all audit information, records, and findings will be treated as confidential. [Party A] and any third-party auditors will be required to sign a confidentiality agreement before conducting any audit, and the audit hours shall include time spent ensuring confidentiality during the process.

Audit hours clause with provision for ongoing audit access

This version allows for ongoing access during the year.

[Party A] shall have the right to access [Party B]’s records for a total of [X] audit hours per year. In addition, [Party A] may request additional ad-hoc audits during the year, provided these are scheduled in advance and are in line with the agreed hours.

Audit hours clause with provision for dispute resolution regarding audit results

This version addresses disputes over audit results.

If there is a disagreement over the results of the audit, [Party A] and [Party B] agree to engage in good faith discussions to resolve the issue. If the dispute cannot be resolved, the matter will be referred to [mediation/arbitration] as outlined in [Section X].

Audit hours clause with provision for mutual agreement on audit methods

This version involves mutual agreement on audit methods.

[Party A] and [Party B] will mutually agree on the audit methods to be used during the annual audit of [X] hours. This will include whether the audit is conducted on-site, remotely, or through a third-party provider, with both Parties agreeing to the method in writing before the audit is conducted.

Audit hours clause with provision for audit performance tracking

This version includes performance tracking during audits.

The Parties agree that the audit hours outlined in [Exhibit A] will include the tracking and documentation of audit performance metrics. This will help measure efficiency and effectiveness, ensuring that the audits are conducted in a timely and thorough manner.

This version includes cost sharing based on findings.

If the audit reveals that [Party B] has not met certain agreed-upon performance standards, the Parties will share the cost of resolving the issue. The cost-sharing arrangement will be determined based on the severity of the findings and the associated corrective actions required.

Audit hours clause with provision for multi-stage audits

This version involves multi-stage audits.

[Party A] may conduct a multi-stage audit of [Party B]’s records, with up to [X] hours of audit time dedicated to each stage. Each stage will focus on a different area, such as financial performance, compliance, and operational efficiency, ensuring a comprehensive review.

This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.

Last updated 11 Mar 2025