Currently when you make a company "Inactive" and there had been a previous subcontract or purchase order, that subcontract or PO record is no longer visible in the procurement views. There should be an option to deactivate and allow the record to still be visible but not transacted against in any way. A record that has open transactions, PO, Subcontract, bills, should not be able to be made inactive.
I agree, and to add there almost needs to be a workflow approval of making company's Active and Inactive.