Outsourcing and internal controls

M

Msmithstafford

#1
Recently, several states have outsourced some of the services traditionally provided by government employees. In one state, the Department of Health and Human Services (Department) is close to finalizing an agreement to outsource its electronic benefit transfer services to eFunds Inc. Under the contract, eFunds Inc. will be responsible for the electronic distribution of food stamp programs, including transaction processing, reporting, contract management, contract settlement, operations support, help desk services, and project management. For cost reasons, eFunds Inc. will send the work to five offshore service centers it owns in India and can also contract with other companies as necessary. What are the key controls you would recommend to mitigate the risks and What role should the Department’s internal audit function take to assist the Department in dealing with these risk and control issues before and after the contract is finalized? Be specific. Let’s assume it will not be practical to send internal auditors to India.
 
Elsmar Forum Sponsor

John Broomfield

Staff member
Super Moderator
#2
Recently, several states have outsourced some of the services traditionally provided by government employees. In one state, the Department of Health and Human Services (Department) is close to finalizing an agreement to outsource its electronic benefit transfer services to eFunds Inc. Under the contract, eFunds Inc. will be responsible for the electronic distribution of food stamp programs, including transaction processing, reporting, contract management, contract settlement, operations support, help desk services, and project management. For cost reasons, eFunds Inc. will send the work to five offshore service centers it owns in India and can also contract with other companies as necessary. What are the key controls you would recommend to mitigate the risks and What role should the Department’s internal audit function take to assist the Department in dealing with these risk and control issues before and after the contract is finalized? Be specific. Let’s assume it will not be practical to send internal auditors to India.
Msmithstafford,

Have you issued your performance specification and was it used to select your contractor?

Does it oblige your contractor to demonstrate effective control over its processes to fulfill your performance spec?

Has your contractor submitted its control plan so you can sample control points for more or less real-time monitoring?

What about the contractor’s removal of root causes to stop recurrence of any nonconformity?

What records is the contractor required to submit with its applications for payment?

Given these tools you should be well set for monitoring performance.

John
 
Thread starter Similar threads Forum Replies Date
R IATF 16949 - Outsourcing of internal audits Internal Auditing 11
V Outsourcing Internal Quality Auditing functions Internal Auditing 26
D Contracted Internal Auditors - Outsourcing Internal Audits Internal Auditing 14
Crusader Your Internal Audit Team: Internal or Hired External? Outsourcing Internal Audits Internal Auditing 100
K Outsourcing ISO 9000 Internal Audits Internal Auditing 12
apestate Outsourcing Internal Audits - Is this a bad idea? Internal Auditing 14
R Outsourcing Internal Audits - Hiring a contractor to plan and perform internal audits Internal Auditing 21
Marc Outsourcing Internal Audits - 60 Retail Stores - Effectiveness vs. Compliance Internal Auditing 6
F Rules of process outsourcing in China China Medical Device Regulations 1
A Outsourcing IEC 60601-1 Ed 3.2 Testing IEC 60601 - Medical Electrical Equipment Safety Standards Series 0
S ISO 45001 and outsourcing the transporation of products Occupational Health & Safety Management Standards 4
A Sample Agreement available for Outsourcing Medical Device Design activity? ISO 13485:2016 - Medical Device Quality Management Systems 1
G QMS requirements for legal manufacturer when outsourcing manufacturing process Other Medical Device Regulations World-Wide 25
B ISO 50001 Interpretation of section 3.3.9 (Outsourcing) ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 5
M Supplier Management outsourcing - Business idea Supplier Quality Assurance and other Supplier Issues 8
S Outsourcing manufacturing - Who controls the suppliers of parts to the CMO? ISO 13485:2016 - Medical Device Quality Management Systems 2
B Outsourcing process design (8.3.3) IATF 16949 - Automotive Quality Systems Standard 1
T ISO 13485 for software outsourcing company ISO 13485:2016 - Medical Device Quality Management Systems 7
G Outsourcing Processes within the Same Company (ISO 13485) Quality Manager and Management Related Issues 4
smryan Compliance Officer Outsourcing? RoHS, REACH, ELV, GADSL, IECSC Other ISO and International Standards and European Regulations 5
B Must a Design Outsourcing Company have ISO13485? ISO 13485:2016 - Medical Device Quality Management Systems 3
R Microbiology Testing Outsourcing - Transport Qualification and Risk Assesssment Qualification and Validation (including 21 CFR Part 11) 2
J Definition Outsourcing - How Far Does it Go? Definitions, Acronyms, Abbreviations and Interpretations Listed Alphabetically 6
J API Q1 9th Edition - Question on Outsourcing 5.6.1.6 Oil and Gas Industry Standards and Regulations 1
S Outsourcing a Core Process ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 1
M Medical Device Outsourcing Batch Traceability Requirements Other Medical Device and Orthopedic Related Topics 2
G Definition Work Transfer vs. Outsourcing Definitions, Acronyms, Abbreviations and Interpretations Listed Alphabetically 6
Crusader 7.6 Calibration (referencing outsourcing) in the Quality Manual Quality Management System (QMS) Manuals 5
S Outsourcing PPAP Function APQP and PPAP 8
C How to handle Outsourcing with Same Site - Separate Cert ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 7
Y ISO9001 Implementation for Business Process Outsourcing ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 6
T Outsourcing Calibration - NIST, OEM, and Calibration Laboratory General Measurement Device and Calibration Topics 2
L Risk Management in Outsourcing Company ISO 14971 - Medical Device Risk Management 16
A Outsourcing Records Storage - Compliance Aspects to be considered during Audits Document Control Systems, Procedures, Forms and Templates 7
R Outsourcing of a Semi-Finished Product - Which major things to address in the QMS ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 2
T Outsourcing Shipping Product directly from our Warehouse to the End Customer ISO 13485:2016 - Medical Device Quality Management Systems 2
T Brief Survey for OEM's about Outsourcing Supplier Quality Assurance and other Supplier Issues 5
E Business Process Outsourcing - Training Plans for Employees where you deliver labour ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 2
B ISO 13485 and Medical Device Manufacturing Outsourcing ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 2
K What's the difference between Outsourcing and Work Transfer? AS9100, IAQG, NADCAP and Aerospace related Standards and Requirements 4
J General Procedure for Outsourcing of Human Resources and Service Processes wanted Document Control Systems, Procedures, Forms and Templates 1
J Extending QMS Scope to External Company Site (Outsourcing) ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 2
Sidney Vianna From Human Resources to Outsourcing ? ISO expands work in five areas Other ISO and International Standards and European Regulations 4
O Outsourcing part of Design & Dev Process- Still requiring D&D ver & val-7.3.5, 7.3.6? IATF 16949 - Automotive Quality Systems Standard 6
B Distributor Outsourcing Value Added Services - Is it work transfer? AS9100, IAQG, NADCAP and Aerospace related Standards and Requirements 9
T To share and (hopefully) to hear feedback - Outsourcing to China Quality Manager and Management Related Issues 20
R ISO/TS 16949:2009 Clause 4.1 General Requirements (Outsourcing) Clarification IATF 16949 - Automotive Quality Systems Standard 6
L Outsourcing Special Processes such as Plating, Painting, NDT as related to AS9100 AS9100, IAQG, NADCAP and Aerospace related Standards and Requirements 13
L Outsourcing of Quality Tests (same company but different division) AS9100, IAQG, NADCAP and Aerospace related Standards and Requirements 4
S Outsourcing manufacturing of final product ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 10

Similar threads

Top Bottom