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Traceability - the ability of developers to describe and follow the life of an artifact throughout the software development life cycle - is an important process that facilitates acquisition and use of process knowledge. While there has been extensive research focusing on the development of traceability solutions, there is a paucity of research that characterizes the tasks that need to be performed in implementing and using traceability. This research addresses this gap by conceptualizing traceability practice in software development as comprising information processing and communication among developers involved in the process. Accordingly, we present the results of two complementary studies focusing on these two aspects of traceability. Based on Study 1, we develop a process model for information processing in traceability. Through Study 2, we identify important contingency factors that impact the mode of communication among developers and customers. We argue that choice of communication media should be dictated by matching particular media characteristics such as synchronicity, reprocessability, and channel capacity to the situation at hand rather than by using aggregated measures such as media richness or social presence. We integrate the findings from our two studies into a process model that prescribes guidelines for traceability practice in software development. Our prescriptions also help traceability tool developers in delivering traceability support that facilitates appropriate information processing and communication capabilities, taking various project characteristics into consideration.