ALRAQABA . ISSUE 15
89
A contract is a legally binding agreement that defines and governs the rights and duties between or
among its parties. A contract is considered legally enforceable when it meets the requirements of
an applicable law. Cornell Law School defines Contracts as “An agreement between private parties
creating mutual obligations enforceable by law. The basic elements required for the agreement to
be a legally enforceable contract are mutual assent, expressed by a valid offer and acceptance;
adequate consideration; capacity; and legality. Possible remedies for breach of contract include
general damages, consequential damages, reliance damages, and specific performance.”
Bashaier Rasheed Ben-Salamah
Associate Auditor - Social Affairs Pre-audit Division
Contracts play a major role in acquiring goods and services i.e. Contracts for sale of goods, and
Contracts for services. In order to purchase goods or services, entities can use various ways and
methods to complete the purchase process successfully. However, each method has different pros
and cons. Nonetheless, using bidding processes provides open and free competition, which helps
the entity in getting its needs at the best price available.
According to Lawinsider.com, Competitive bidding is “The submission of prices by a business
competing for a contract to provide supplies, materials, equipment or contractual services to a
state contracting agency, under a procedure in which the contracting authority does not negotiate
prices, as set forth in statutes and regulations concerning procurement”. Also, the main purpose of
using Competitive bidding is to obtain goods or services at a competitive low price. In competitive
bidding, bidders use sealed bids in competing to earn the award of a contract. In addition, bidders
Contracts and
Fraud
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