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Measurement of Performance based on Internal Audit Reports

PE-2011

Quite Involved in Discussions
#1
Hi,

I would like to measure the performance based on the internal audit report. Can anyone suggest any tools for the same.

Regards
Maheswari
 

Ted Schmitt

Quite Involved in Discussions
#4
Re: Measurement of Audit Reports

Hi,

I would like to measure the performance based on the internal audit report. Can anyone suggest any tools for the same.

Regards
Maheswari
Before you define the tool used, it would help us if you defined "measure the performance". Do you want to tabulate NC per process ? By major or minor? By cause? By department? By product? Or make a summary for management?
 

PE-2011

Quite Involved in Discussions
#7
Re: Measurement of Audit Reports

Before you define the tool used, it would help us if you defined "measure the performance". Do you want to tabulate NC per process ? By major or minor? By cause? By department? By product? Or make a summary for management?
Yes as I mentioned in my second quote, I want to make a summary for management.
 
M

Markaich

#8
Re: Measurement of Audit Reports

I'm not a particular fan of audit systems that give scores.

In my experience (a large number of audits using DNV's ISRS protocol across three nuclear licensed sites), auditees tend toward point grabbing, that is implementing arrangements for no other purpose that gaining a few additional points, quite often there is no business benefit.

Currently the DNV ISRS is at version 8; version 7 was a great improvement on 6 but I have no knowledge of 8. There is still the very real danger of point grabbing however.

I would advise trying to find some other tool for quantifying performance (Balanced Scorecard for instance) rather than using audit.

Hope this helps
M
 

RoxaneB

Super Moderator
Super Moderator
#9
Re: Measurement of Audit Reports

Thanks. It is helpful, thanks.

Actually our internal audit plan is quarterly. I want to measure department wise audit result. I mean I wish to check each department's up-down level in each quarter.
Measuring a department's %-increase or %-decrease in audit findings is a metric, however what do you wish to gain from it? How does it add value to the overall audit process? How does it show improved or worsening performance of a department?

There are other variables to consider when looking at findings, such as:
  • Finding classification - major / minor
  • Clause associated with finding - repeats? first time?
  • Serverity of finding - risk of nonconformance, cost of nonconformance, etc.

For example, let's say a department is audited in one quarter and there are 4 findings. The next quarter there is only 1. At first glance, it appears they have improved, HOWEVER, what if that one finding would have resulted in a massive recall of products whereas those first four were simply documentation errors and record-keeping issues? Which, to you, requires more attention and discussion when presenting the numbers to management?

If you do a search for 'audit metrics', you should see several threads appear where we have discussed suitable (and not so suitable) indicators that can be used for evaluating the health of an audit programme.
 

PE-2011

Quite Involved in Discussions
#10
Re: Measurement of Audit Reports

Hi, Thanks. I am sure, measuring audit performance will definitely increase the quality and performance of an organization. For example, production department: we are measuring how many production plan planned during one quarter, how many done within time, how many late productions, why late productions, and resultant customer satisfaction. Same way behaviour of employees also auditing.

So each quarter if we measure it, is it add value to the organization or not?
 
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