- Memorandum agreements are used by public and private entities.signing a contract image by William Berry from Fotolia.com
A memorandum of agreement (MOA), sometimes referred to as a memorandum of understanding (MOU) or a pre-contract, identifies the scope of association and responsibilities of two or more parties entering into some sort of business arrangement. Generally neither an MOA nor MOU establishes a binding accord. However, if the agreement includes the three basic components of a contract---offer, acceptance and consideration--it would then constitute a legitimate binding contract. - A MOA must include the following four components to be "legally operative." The document must identify the parties involved, note the pertinent issues and proposed objectives, include a summary of the essential terms of the agreement and the signatures of the parties involved. Although generic templates are available, as long as these elements are included the agreement is valid. A variety of enterprises develop and enter into MOAs on a consistent basis.
- Many departments in the public school system uses either an MOA or MOU whether dealing with parent grievances, experimenting with pilot programs or nutritional expectations. For example, in 2006, the Clinton Foundation in tandem with the Alliance for a Healthier Generation entered into a MOU with several food manufacturers regarding new "Guidelines for Competitive Foods Sold in Schools to Students" applicable to public schools in Arkansas.
- As with undergraduate systems, university departments also use MOAs or MOUs to document statements of interest or research specifics. For example, in its International Programs Department alone, Florida Atlantic University has seven standing MOUs, including the General College Memorandum of Understanding, General Research Memorandum of Understanding and the Joint Research Agreement.
- Often a local or national advocacy group enters into a MOA or MOU with a state organization to establish a collaborative relationship. For example, Advocates for Youth, a group that "champions efforts to help young people make informed and responsible decisions about their reproductive and sexual health," develop MOAs and work in partnership with state and local organizations to offer training and assistance in areas such as education facilitation, AIDS awareness and prevention and organizational development.
- Federal government agencies sometimes use MOAs and MOUs to establish inter-agency relationships. The U.S. Department of Health and Human Services created extensive and detailed instructions on how to create these agreements with regard to case management and coordinating agencies that care for the elderly. Although some inter-agency relationships rely on informal understandings of employees, other relationships are complicated enough to require formalization through the development of an MOA. With this formalization comes efficiency, order and organization in the system as the several agencies now have consistent terms and objectives.
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