ize that as a project progresses, risk increases in scope and size. Before the project goes operational, risk is mainly the money invested SO far. After a project goes operational, the scope of risk expands to the total business. Another important point to maintain awareness of is the practice of using two types of contracts: active and passive. Active contracts require action on the part of the acceptor in the form of a physical signature or other equivalent approval. Passive con- tracts include the provision that certain actions-such as the act of opening software, breaking a physical seal on a package, executing an installation script, or executing an application-indicate accept- ance. In other words, when the executioner carries out the actions spelled out in the licensing agreement, they become bound by and accept the terms of the license. IMPLICATIONS OF ACCEPTANCE Acceptance of an item on a contract or order is generally understood to mean that the item meets the needs and requirements set out by the buyer, clearing the way for payment to the seller. Upon payment, ownership of the item passes from the seller to the buyer. This is PRACTICAL IP AND TELECOM FOR BROADCAST ENGINEERING AND OPERATIONS the high-level simple view. The more complex reality of managing communications network capital investment and operating expenses is embedded in the facts and details of the agreement of sale. Compli- cating this picture are two factors. One is the fact that there are three types of items covered in the agreements: equipment, facilities, and services. Second, the value of the items runs the gamut from pennies to millions of dollars per unit, complicated by the possibility of the charges being one-time or recurring on some periodic basis. Man- aging costs and expenses is the subject of Chapter 11; however, for now it is important to know and not forget that accepting delivery and agreeing to pay not only impacts the cash on hand, but also the organizations financial statements beginning with the next financial report