External auditors

An organisation such as the example above includes sub groups for each of the main activities and a support (or services) group to manage information and procurement. Auditing commitments may be fulfilled by an independent in-house team or by external auditors. 

Most large organizations, particularly in central and local government, have set procedures in the form of standing orders, and this area is usually of most interest to internal and external auditors. The object of inviting competitive bids is to obtain the lowest price for the job, based on a fair method, which enables every bidder to bid for the same thing. 

Gilhooley lA. Improving the relationship between internal and external auditors. J Acc EDP 1 (1) 4-9, Spring 1985. 

There is an industry trend toward dedicating specific personnel to the function of internal audits and quality assessments. This approach allows the assessor or auditor to focus on the compliance of the company and its vendors and contractors as well as maintain an independent role allowing for impartial assessment of all areas, including the QA unit. Those companies whose assessors and auditors also perform QA responsibilities might seriously consider the regular use of an independent assessment group, such as corporate auditors or an independent consultant. A fresh pair of eyes, coupled with extensive exposure to multiple worldwide operations, makes using external auditors, preferably with some former FDA experience a tremendous asset to any company. 

Each organization must devise their own way to conduct an audit. Other readers may wish to consider details of Audits and Corrective Actions or Chapter 13 of Plant Guidelines for Technical Management of Chemical Process Safety [4] which covers broad topics such as Scope, Staffing, Frequency, Reports, and Internal and External Auditors. It is not the intent of this book to cover that aspect of auditing. 

Alternately, there are some highly credible external auditors available some operating through major corporation and some working independently. The selection key is the auditor s (and, perhaps, their company s) credibility with the FDA. Independence is enhanced if the external auditor works on a fixed price or alternate billing system that keeps fees separate from findings. 

Audits should be detailed and conducted by competent and impartial persons from the company. External auditors may also be useful. 

It is critical that this validation report be properly identified and available for review by external auditors. A properly designed validation exercise and the accompanying report can also form the basis for a publication in a scientific journal when the contents of the report are sufficiently novel. In subsequent sections of the chapter, we will discuss the different aspects of validation experiments typically conducted for methods intended for screening, quantification, or confirmation purposes. 

Standard ISO/IEC 17025 2005 requires that the laboratory implements routine internal and external audits. Internal audits are managed by the quality manager appointed within the laboratory. The purpose of internal audits is to verify that the laboratory is complying with the requirements of the standard and with company policies, processes, and procedures. These audits are also useful in preparing for external audits. External auditors can come from clients or from accreditation bodies. Their purpose is to verify that the laboratory is operating in compliance with ISO/IEC 17025 2005. 

External auditors were brought in on an annual basis to audit both the mine and the plant, and excellent audit scores were achieved. The mine was rated three-star and the plant four-star. Star ratings were restricted because of NCSA s policy of incorporating the injury rate as one of the grading criteria. 

All activities range from initial design, inspection, and purchase of process plant, and their operation and maintenance and safe operating practices shall be audited for enforcing proper working. External auditors can be employed for an independent assessment. Regular internal audits for performance, safety, and energy efficiency shall also be carried out. 

Performance indicators can help management or external auditors to roughly get an insight into the functioning of the quality system. 

There is overlap between the two approaches. For example, a company that uses self-regulation always faces the possibility of an external audit from a government agency. Also, its program will be scrutinized very carefully by outsiders if there is a serious accident. Also some companies use internal auditors that are supplied by corporate headquarters. They act in the same way as external auditors. 

External auditors pass through looking for the correct color tape, not the condition of the equipment. Amazing The whole process was developed to increase inspection of the equipment and the result is exactly the opposite. Now the correct color tape, not the condition of the equipment, is the pass/fail indicator. 

A statement of all write-offs and write-downs during each financial period shall be submitted to the External Auditor as part of the financial statements prepared under Regulation 11.1. 

Any loss of cash, stores and other assets must be reported by the Principal Financial Officer to the Director-General and, subsequently, to the External Auditor. No amount due to the OPCW may be waived without the prior written authorisation of the Director-General. The investigation referred to in Regulation 10.5 shall, in each case, fix the responsibility, if any, attaching to any staff member of the OPCW for the loss. Such staff member may be requested by the Director-General to reimburse the loss, either partially or in full. 

The financial statements for the financial period shall be prepared under the direction of the Principal Financial Officer as at 31 December of the financial period. The financial statements shall, after approval by the Director-General, be submitted to the External Auditor not later than three months following the end of the financial year, together with such statements as may be required. 

The Principal Financial Officer shall ensure that accounting and other financial and property records and all supporting documents are retained for five years or other period(s) as may be agreed with the External Auditor, after which, on the authority of the Director-General, such records and documents may be destroyed. The retention periods shall be spelled out in a Financial Directive. 

The financial statements enumerated in Regulation 11.1 shall constitute the core financial statements as submitted for, and subject to, examination by the External Auditor. The Conference of the States Parties or the Executive Council acting on its behalf may, from time to time, request the Director-General to submit additional financial or other information. Such information shoxdd be submitted in an informational annex accompanying, but not part of, the core financial statements. 

The financial statements shall be submitted by the Director-General to the External Auditor not later than 31 March following the end of the financial period to which they relate. 

Reports on each separate audit, inspeetion, evaluation, investigation, and monitoring activity shall be submitted to the Director-General. For each report, the relevant Division Director shall be afforded adequate opportunity to consider and comment upon the observations and draft recommendations. Copies of all reports and accompanying comments by the Director-General shall be provided to the External Auditor. 

An External Auditor, who shall be the Auditor-General (or an officer holding an equivalent title) of a State Party, shall be appointed in the manner and for the period determined by the Conference of the States Parties and for a single period of not less than two years, but not exceeding six years. 

If the External Auditor ceases to hold office as Auditor-General in his own country, his appointment as External Auditor of the OPCW shall terminate forthwith and he shall be succeeded as External Auditor by the person who succeeds him as Auditor-General in his home country. The External Auditor may not otherwise be removed during the tenure of his appointment, except by the Conference of the States Parties. 

The External Auditor may make observations with respect to the regularity and efficiency of the OPCW s financial procedures, the accounting system, the internal financial controls and, in general, the administration and management of the OPCW. 

The External Auditor shall be completely independent and shall be solely responsible for the conduct of audits. 

The Conference of the States Parties may request the External Auditor to perform special examinations and to issue separate reports on the results thereof. Acting under the authority of the Conference, the Executive Council may do likewise. 

The Director-General shall provide the External Auditor with the facilities he may require to perform audits. 

For the purpose of making local or special examinations or of reducing the costs of audits, the External Auditor may engage the services of any national Auditor-General (or officer holding an equivalent post), commercial public auditors of known repute or any other person or firm who, in the opinion of the External Auditor, is technically qualified to conduct audits. 

The External Auditor shall issue a report and opinion on his audits of the OPCW s financial statements, which shall include such information as he deems necessary in regard to matters referred to in Regulation 13.4 and in the additional terms of reference set forth in the Annex to these Regulations. 

The External Auditor shall transmit his report and opinion and the audited financial statements, in accordance with any directions given by the Conference of the States Parties, to the Executive Council. The Executive Council shall examine the audited financial statements and the External Auditor s report and opinion, and shall forward them to the Conference of the States Parties with such comments as it deems appropriate. The External Auditor s report and opinion and the audited financial statements shall be submitted to the Executive Council preferably not later than 31 May following the end of the financial period to which they relate. 

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