Vendor Risk Quarterly Review Template

Your critical vendors change. Their security posture shifts, key personnel leave, subcontractor relationships evolve. Annual assessments miss these changes for 364 days.

Quarterly vendor reviews bridge this gap. They're lightweight touchpoints that validate control effectiveness between comprehensive annual assessments. Think of them as continuous monitoring checkpoints — not full DDQs, but targeted evidence collection focused on what changed since last quarter.

The challenge? Manual quarterly reviews consume 6-10 hours per vendor. Multiply that by 50+ critical vendors, and you're looking at 300-500 hours of work every quarter. That's why most TPRM programs skip quarterly reviews entirely, leaving risk exposure undetected until the next annual cycle.

A properly structured quarterly review template reduces this burden to 2 hours per vendor while increasing detection rates for control failures, fourth-party changes, and emerging risks. The template enforces consistent evidence collection, automates risk scoring updates, and creates an audit trail that satisfies regulatory requirements.

Core Template Components

1. Vendor Identification Block

Start with basics that link to your vendor master record:

• Legal entity name and DBA
• Vendor ID (from your VRM system)
• Contract expiration date
• Primary service category
• Current inherent risk tier
• Last full assessment date

This section takes 2 minutes but prevents the most common error: reviewing the wrong entity or outdated contract terms.

2. Control Validation Matrix

The heart of your quarterly review focuses on controls that typically drift:

Control Domain	Evidence Required	Validation Method	Frequency of Drift
Access Management	User access review logs	Screenshot of last 90 days	73% quarterly change
Incident Response	Incident register	Export with severity ratings	45% quarterly change
BCP Testing	Test results summary	Dated test reports	38% quarterly change
Patch Management	Vulnerability scan results	Dashboard export	92% quarterly change
Employee Training	Completion certificates	HR system export	67% quarterly change

Focus on controls with high drift rates. Skip static controls like physical security unless you have specific concerns.

3. Performance Metrics Dashboard

Quantitative metrics reveal trends before they become incidents:

Availability Metrics

• Uptime percentage (target vs actual)
• Planned maintenance windows
• Unplanned outages (count and duration)
• RTO/RPO achievement rates

Security Metrics

• Security incidents reported
• Mean time to patch critical vulnerabilities
• Failed security scans
• Phishing test failure rates

Compliance Metrics

• SLA breaches
• Audit findings (internal and external)
• Certification status changes
• Regulatory violations or fines

4. Fourth-Party Risk Assessment

Vendors rarely volunteer subcontractor changes. Your template must explicitly ask:

• New subcontractors added this quarter
• Subcontractors removed or changed
• Material changes to existing subcontractor scope
• Geographic location changes for data processing

Include a declaration requirement: "Vendor certifies no material fourth-party changes except those listed above."

5. Incident and Issue Log

Structure this section to capture both reported and detected issues:

[Incident ID] | [Date] | [Severity] | [Description] | [Root Cause] | [Remediation Status]

Require vendors to report:

• Security incidents (even if contained)
• Data breaches (including near-misses)
• Regulatory inquiries or investigations
• Service disruptions exceeding 4 hours
• Employee terminations in sensitive roles

Industry-Specific Applications

Financial Services

Add sections for:

• GLBA Safeguards Rule compliance updates
• Changes to data retention practices
• Updates to business continuity testing (FFIEC requirements)
• Concentration risk indicators
• Model risk management updates (SR 11-7 compliance)

Reference: Federal Reserve SR Letter 13-19 requires ongoing monitoring of critical service providers.

Healthcare

Include HIPAA-specific validations:

• Workforce training updates (45 CFR 164.308(a)(5))
• Access control reviews for ePHI systems
• Encryption status for data at rest and in transit
• BAA compliance confirmations
• Breach notification history

Technology Sector

Focus on:

• API security updates
• Open source component vulnerabilities
• Cloud infrastructure changes
• DevSecOps pipeline modifications
• Third-party code audit results

Compliance Framework Alignment

Your quarterly review template should map to specific framework requirements:

SOC 2 Trust Service Criteria

• CC2.2: Board oversight of vendor performance
• CC3.2: Risk assessment updates
• CC9.2: Vendor performance monitoring
• A1.1: Availability commitments

ISO 27001:2022

• Clause 15.1: Supplier relationships
• Clause 15.2: Supplier service delivery management
• Control A.15.2.1: Monitoring supplier services
• Control A.15.2.2: Managing supplier service changes

GDPR Article 28

• Processor compliance verification
• Sub-processor approval tracking
• Data location confirmations
• Cross-border transfer mechanism updates

Implementation Best Practices

1. Risk-Based Review Frequency

Not all vendors need quarterly reviews. Apply this tiering:

Risk Tier	Review Frequency	Review Depth
Critical	Quarterly	Full template
High	Quarterly	75% of sections
Medium	Semi-annually	50% of sections
Low	Annually	Annual assessment only

2. Automation Opportunities

• Pre-populate vendor data from your VRM system
• Use APIs to pull performance metrics automatically
• Set up email reminders 30 days before review dates
• Create Power BI dashboards for trend analysis
• Implement automatic risk score recalculation

3. Evidence Storage Structure

Organize quarterly evidence in a predictable hierarchy:

/Vendor Name/
  /2024/
    /Q1/
      /Control Evidence/
      /Performance Reports/
      /Issue Documentation/
    /Q2/
    /Q3/
    /Q4/

Common Implementation Mistakes

1. Over-Engineering the Template

Teams often create 50-page quarterly reviews that nobody completes. Keep it under 10 pages. If a control hasn't changed in 8 quarters, remove it from quarterly reviews.

2. Accepting Stale Evidence

"See Q4 2023 response" isn't acceptable. Require current evidence dated within the review period. Screenshots must show system timestamps.

3. Ignoring Negative Trends

Three quarters of degrading performance requires escalation. Don't wait for SLA breaches. Your template should include automatic triggers:

• some performance degradation = management notification
• 20% degradation = remediation plan required
• a significant number of degradation = executive escalation

4. Inconsistent Scoring

Define your scoring rubric upfront:

• Green (0 points): Full compliance, all evidence provided
• Yellow (1 point): Minor gaps, remediation planned
• Red (3 points): Material gaps, immediate action required

Total scores above 10 trigger formal remediation procedures.

5. Missing the Business Context

Technical controls matter, but business changes matter more:

• Mergers and acquisitions
• Leadership changes
• Financial distress indicators
• Major client losses
• Regulatory investigations

Frequently Asked Questions

How do I determine which vendors require quarterly reviews versus annual assessments?

Use inherent risk scoring based on data sensitivity, operational criticality, and regulatory requirements. Vendors processing PII/PHI, supporting critical business functions, or representing >$1M annual spend typically require quarterly reviews.

Should quarterly reviews replace annual assessments?

No. Quarterly reviews are targeted check-ins that supplement comprehensive annual assessments. Annual assessments remain necessary for full control validation, contract reviews, and strategic relationship planning.

What's the minimum evidence required for a valid quarterly review?

At minimum, collect updated SOC reports or ISO certificates, 90-day incident logs, current insurance certificates, and performance metrics. Add risk-specific evidence based on your vendor's service type.

How do I handle vendors who refuse to participate in quarterly reviews?

Reference your contract's audit rights clause. Most agreements include ongoing monitoring provisions. For resistant vendors, start with automated data collection and publicly available information, then escalate through procurement.

Can I use the same template across all industries and vendor types?

The core template works across industries, but add industry-specific sections. Financial services vendors need GLBA sections, healthcare vendors need HIPAA components, and cloud providers need additional technical controls.

How long should vendors have to complete quarterly reviews?

Provide 15 business days for critical vendors, 20 days for others. Send reminders at day 10 and day 15. Auto-escalation triggers on day 21.

What tools integrate with quarterly review templates?

Most GRC platforms (ServiceNow, Archer, OneTrust) support custom assessment templates. For smaller programs, SharePoint forms or Google Forms work with proper security controls.