Purchasing Department Internal Audit HELP!

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chardcaringal

I'm currently hired as an Internal Audit of a manufacturing company. I start doing field audit for the company which is basically my core. However, the company require me to do systems audit on all department, currently my project is the audit of Purchasing Department as a whole. I'm starting to read the forums anything regarding audit of purchasing department. Can i ask for those you are doing systems audit a little guide to start of? maybe a Purchasing Department Audit checklist will greatly help. im am currently studying the current process of the company and at the same time reading my books regarding the Purchase process itself. I hope someone can give me a little guide regarding this. :bigwave: :cfingers:

Company background:

The company is engage in local manufacturing of toothpaste and dish washing products. an employee of about 200 and serving nationwide wide a number of local distributors.


Please give your insights!

Regards,

chard:whip::thanx:
 

AndyN

Moved On
Re: Purchasing department Audit HELP!

Chard:

Welcome to the Cove

You are doing the right thing. Study the company process for Purchasing and audit the implementation - what they do - to that process. You should find out if they have added any new suppliers or if the manufacturing organization has had problems with anything coming from suppliers, then use that to select examples to track through the process...
 
C

chardcaringal

Re: Purchasing department Audit HELP!

Chard:

Welcome to the Cove

You are doing the right thing. Study the company process for Purchasing and audit the implementation - what they do - to that process. You should find out if they have added any new suppliers or if the manufacturing organization has had problems with anything coming from suppliers, then use that to select examples to track through the process...

Thanks Andy. It's really hard starting a systems audit especially if your not used to it. HOwever, I'm very challenge with this new task!

Anyway, thanks for the quick reply..^_^:thanx::applause:
 

Big Jim

Admin
Re: Purchasing department Audit HELP!

I'm currently hired as an Internal Audit of a manufacturing company. I start doing field audit for the company which is basically my core. However, the company require me to do systems audit on all department, currently my project is the audit of Purchasing Department as a whole. I'm starting to read the forums anything regarding audit of purchasing department. Can i ask for those you are doing systems audit a little guide to start of? maybe a Purchasing Department Audit checklist will greatly help. im am currently studying the current process of the company and at the same time reading my books regarding the Purchase process itself. I hope someone can give me a little guide regarding this. :bigwave: :cfingers:

Company background:

The company is engage in local manufacturing of toothpaste and dish washing products. an employee of about 200 and serving nationwide wide a number of local distributors.


Please give your insights!

Regards,

chard:whip::thanx:

Purchasing, as specified in element 7.4, is made up of three main things.

First, is supplier control. Determine how they say they approve suppliers and what records of approval are kept. Many companies keep an approved supplier list (ASL). Randomly select a few suppliers and ask to see the approval records. Find out if they periodically review the suppliers, and if they do, ask to see those re-approval records. Refer to element 7.4.1 to make sure you are looking for all the requirements and if they have a purchasing procedure, that they are following it.

Second, is purchasing information. Randomly select a few purchase orders and see if the purchasing information is adequate. The basic idea is to describe what you are buying well enough that the person filling the order has no problem understanding what you need and that the person receiving the order can easily confirm that you actually received the right things. Refer to element 7.4.2 for the requirements. Be aware that the list that makes up 7.4.2 a-c is an "as appropriate" list, so you won't necessarily see all three for all cases.

As a cross check, go back to the supplier approval records and confirm that approved suppliers were used for the purchase orders you reviewed.

Third, is receiving inspection. This is confirming that you received what you asked for. Somehow within the organization a three way match needs to take place. The received product needs to match the shipping paperwork, and in turn needs to match the purchase order. Sometimes this is all done at receiving. Sometimes a receiving report is generated through the computer system which displays what is essentially a mirror image of the needed portions of the purchase order. Sometimes the confirmation that the product matches is performed by an inspection or quality person. No matter how it is done, the three way match needs to happen. If possible, observe some receiving to see how it is accomplished. If you can't observe receiving as it is happening, review several recent packing slips and interview the person performing receiving to confirm the practice meets requirements. See element 7.4.3 for the requirements.

This should get you started. Make sure that you also confirm that they are following their purchasing procedure if they have one.

Good luck.
 
C

chardcaringal

Re: Purchasing department Audit HELP!

Purchasing, as specified in element 7.4, is made up of three main things.

First, is supplier control. Determine how they say they approve suppliers and what records of approval are kept. Many companies keep an approved supplier list (ASL). Randomly select a few suppliers and ask to see the approval records. Find out if they periodically review the suppliers, and if they do, ask to see those re-approval records. Refer to element 7.4.1 to make sure you are looking for all the requirements and if they have a purchasing procedure, that they are following it.

Second, is purchasing information. Randomly select a few purchase orders and see if the purchasing information is adequate. The basic idea is to describe what you are buying well enough that the person filling the order has no problem understanding what you need and that the person receiving the order can easily confirm that you actually received the right things. Refer to element 7.4.2 for the requirements. Be aware that the list that makes up 7.4.2 a-c is an "as appropriate" list, so you won't necessarily see all three for all cases.

As a cross check, go back to the supplier approval records and confirm that approved suppliers were used for the purchase orders you reviewed.

Third, is receiving inspection. This is confirming that you received what you asked for. Somehow within the organization a three way match needs to take place. The received product needs to match the shipping paperwork, and in turn needs to match the purchase order. Sometimes this is all done at receiving. Sometimes a receiving report is generated through the computer system which displays what is essentially a mirror image of the needed portions of the purchase order. Sometimes the confirmation that the product matches is performed by an inspection or quality person. No matter how it is done, the three way match needs to happen. If possible, observe some receiving to see how it is accomplished. If you can't observe receiving as it is happening, review several recent packing slips and interview the person performing receiving to confirm the practice meets requirements. See element 7.4.3 for the requirements.

This should get you started. Make sure that you also confirm that they are following their purchasing procedure if they have one.

Good luck.

:thanx:thank you!
this was indeed a great help. i also manage to search the forum for the element 7.4. honestly I do not know that. what are those element? i only got the element 7.4.1 Purchasing process. Is this the AUDIT ELEMENT itself?

:agree:
:thanx:
 

Big Jim

Admin
Re: Purchasing department Audit HELP!

:thanx:thank you!
this was indeed a great help. i also manage to search the forum for the element 7.4. honestly I do not know that. what are those element? i only got the element 7.4.1 Purchasing process. Is this the AUDIT ELEMENT itself?

:agree:
:thanx:

I made the assumption that you are auditing to ISO 9001:2008. Is your company registered to ISO 9001:2008?

7.4.1, 7.4.2, & 7.4.3 are elements in ISO 9001:2008.

If your company is registered to ISO 9001:2008, you need to be trained to it before you attempt to audit it.
 
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chardcaringal

Re: Purchasing department Audit HELP!

I made the assumption that you are auditing to ISO 9001:2008. Is your company registered to ISO 9001:2008?

7.4.1, 7.4.2, & 7.4.3 are elements in ISO 9001:2008.

If your company is registered to ISO 9001:2008, you need to be trained to it before you attempt to audit it.


i just learned that the company is not yet accredited by ISO 9001:2008.
 

Big Jim

Admin
Re: Purchasing department Audit HELP!

i just learned that the company is not yet accredited by ISO 9001:2008.

OK, so what do they want you to audit against? Do they have a written procedure that they want to see if it is being followed. If so, start becoming familiar with it.
 
C

chardcaringal

Re: Purchasing department Audit HELP!

OK, so what do they want you to audit against? Do they have a written procedure that they want to see if it is being followed. If so, start becoming familiar with it.


Basically i will start at nothing. I'm the first audit that they hire. They hire me for the purposes of field audit. But then i was required to start systems audit. I have no choice but to learn it.

my direction is to check there process and procedure if it complies with the set standard of the company and the regulatory agency.:agree1:
 

Big Jim

Admin
Re: Purchasing department Audit HELP!

Basically i will start at nothing. I'm the first audit that they hire. They hire me for the purposes of field audit. But then i was required to start systems audit. I have no choice but to learn it.

my direction is to check there process and procedure if it complies with the set standard of the company and the regulatory agency.:agree1:

So you need to become very familiar with both of those. Find out what they are, and get copies of them.
 
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