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Determining Effectiveness of Internal Audits Presented by: Tony Gutierrez R. Darrell Taylor. Minneapolis, MN July 19 & 20, 2012. Purpose. To discuss how an auditor audits the Internal Audit Process and determine how effective is the process. Definition.

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determining effectiveness of internal audits presented by tony gutierrez r darrell taylor

Determining Effectiveness of Internal AuditsPresented by: Tony Gutierrez R. Darrell Taylor

Minneapolis, MN

July 19 & 20, 2012

purpose
Purpose

To discuss how an auditor audits the

Internal Audit Process

and determine how

effective

is the process

definition
Definition
  • Effective - producing a decided, decisive, or desired effect.

(Merriam- Webster)

  • In addition to establishing conformance with a set of rules, quality audits may measure the adequacy of procedures and the effectiveness of implementation to which those rules assist in achieving basic goals.

(JP Russell, The Quality Audit Handbook)

history lesson
History Lesson

Risk

Metrics

Infrastructure

Issues

Output

Input

Process

Risk Based

Auditing

Method

People

Process Based Auditing

Document Control

Record Control

Purchasing

Production

Calibration

Internal Audit

Corrective Action

Effectiveness

Compliance Auditing

Value Added

the requirement as9100c
The Requirement - AS9100C
  • 8.2.2 Internal Audit
  • The organization shall conduct internal audits at planned intervals to determine whether the quality management system
  • a) conforms to the planned arrangements (see 7.1), to the requirements of this International Standard and to the quality management system requirements established by the organization, and
  • NOTE: Planned arrangements include customer contractual requirements.
the requirement as9100c cont
The Requirement AS9100C (cont.)
  • b) is effectively implemented and maintained.
  • An audit program shall be planned, taking into consideration the status and importance of the processes and areas to be audited, as well as the results of previous audits. The audit criteria, scope, frequency and methods shall be defined.
  • The selection of auditors and conduct of audits shall ensure objectivity and impartiality of the audit process. Auditors shall not audit their own work.
the requirement as9100c cont1
The Requirement AS9100C (cont.)
  • A documented procedure shall be established to define the responsibilities and requirements for planning and conducting audits, establishing records and reporting results.
  • Records of the audits and their results shall be maintained (see 4.2.4).
the requirement as9100c cont2
The Requirement AS9100C (cont.)
  • The management responsible for the area being audited shall ensure that any necessary corrections and corrective actions are taken without undue delay to eliminate detected nonconformities and their causes.
  • Follow-up activities shall
  • include the verification of the actions taken and the reporting of verification results (see 8.5.2).
the internal audit system is a process
The Internal Audit System Is a Process

Method

Metrics

INPUT

OUTPUT

PROCESS

Infrastructure

People

slide10
Audit Process/Plan Diagram Purpose: Identify the elements of the standard applicable to and reviewed during this audit
example
Example

Preparation

Performance

Reporting

Follow-up

effectiveness top five
Effectiveness – Top Five

How does the Internal Audit Team

Define

Effectiveness?

AS9101 D Block 11

Organization’s method for determining process effectiveness:

effectiveness top five1
Effectiveness – Top FIVE

How does the Internal Audit Team Measure Effectiveness?

effectiveness top five2
Effectiveness – Top FIVE

How did the Internal Audit Team Perform?

effectiveness top five3
Effectiveness – Top FIVE

How did the

Inputs match up to the Outputs?

effectiveness top five4
Effectiveness – Top FIVE

Did the Internal Audit

Plan

For Effectiveness ?

Preparation

Performance

PRE – Planning

Reporting

Follow Up

mirror
Mirror
  • WE are auditors – time to look in the mirror!!
  • How do you -
    • DEFINE EFFECTIVENESS
    • MEASURE EFFECTIVENESS
    • PERFORM
    • DESCRIBE INPUTS – OUTPUTS
    • PLAN
compare
COMPARE

Your Program

Their Program

preparation
Preparation
  • How do you prepare for audit performance verification
    • Describe inputs and outputs in the planning stages (objectives, scope…)
    • What do you expect to review and the depth to which auditing will be performed
    • How do you plan to gather objective evidence?
effective approach
Effective Approach
  • From the auditor’s point of view – what would be an effective approach?
    • What records will be evaluated in order to adequately verify the process or system?
    • Should you verify system documentation in an “inch wide and a mile deep” mode or the inverse “a mile wide and an inch deep”?
    • What would be your approach to generate desirable outcomes? (Good planning is important.)
expectations
Expectations
  • What should be the auditor’s expectation?
    • Did the auditor take the appropriate consideration related to but not limited to company size, system documentation and data gathering, time frame to complete the audit, and auditee controls and diverting tactics ?
    • Did self verification result in process improvement upon effective implementation of C/A?
    • What would be considered an adequate verification of an audit performance process?
outcome
Outcome
  • Outcomes and results
    • Do evaluated results meet the audit performance expectation?
    • Is the audit performance an effective one?
    • Is the auditor satisfied with the results?
    • What would be considered an adequate verification of an audit performance process?
    • Was the audit report thorough, citing all pertinent information?
corrective action
Corrective Action
  • Follow up
    • How well was C/A written?
    • Was C/A implemented timely and effectively?
    • Did it yield adequate improvements to the process or system ?
    • Will implemented changes ultimately make a more efficient QMS system, is it more robust?
discussion points
Discussion Points
  • At what point do you audit the internal audit program?
    • Beginning, Middle or End?
  • If the audit program is compliant, but you are writing majors for system breakdowns, how do you handle this?
  • What action do you take ifthe Internal audit team can not define effectiveness?
  • How would you communicate and/or recommend process/system effectiveness of self verification?