What Is Auditing?

• A first-party audit is performed within an organization to measure its strengths and weaknesses against its own procedures or methods and/or against external standards adopted by (voluntary) or imposed on (mandatory) the organization. A first-party audit is an internal audit conducted by auditors who are employed by the organization being audited but who have no vested interest in the audit results of the area being audited.
• A second-party audit is an external audit performed on a supplier by a customer or by a contracted organization on behalf of a customer. A contract is in place, and the goods or services are being, or will be, delivered.
  Second-party audits are subject to the rules of contract law, as they are providing contractual direction from the customer to the supplier. Second-party audits tend to be more formal than first-party audits because audit results could influence the customer’s purchasing decisions.
• A third-party audit is performed by an audit organization independent of the customer-supplier relationship and is free of any conflict of interest. Independence of the audit organization is a key component of a third-party audit. Third-party audits may result in certification, registration, recognition, an award, license approval, a citation, a fine, or a penalty issued by the third-party organization or an interested party.

Industry Certification Through Auditing

Companies in certain high-risk categories—such as toys, pressure vessels, elevators, gas appliances, and electrical and medical devices—wanting to do business in Europe must comply with Conformité Europeënne Mark (CE Mark) requirements. One way for organizations to comply is to have their management system certified by a third-party audit organization to management system requirement criteria (such as ISO 9001).

Customers may suggest or require that their suppliers conform to ISO 9001, ISO 14001, or safety criteria, and federal regulations and requirements may also apply. A third-party audit normally results in the issuance of a certificate stating that the auditee organization management system complies with the requirements of a pertinent standard or regulation.

Third-party audits for system certification should be performed by organizations that have been evaluated and accredited by an established accreditation board, such as the ANSI-ASQ National Accreditation Board (ANAB).

Performance Audits vs. Compliance and Conformance Audits

Value-added assessments, management audits, added value auditing, and continual improvement assessment are terms used to describe an audit purpose beyond compliance and conformance. The purpose of these audits relates to organization performance. Audits that determine compliance and conformance are not focused on good or poor performance, yet. Performance is an important concern for most organizations.

A key difference between compliance audits, conformance audits, and improvement audits is the collection of evidence related to organization performance versus evidence to verify conformance or compliance to a standard or procedure. An organization may conform to its procedures for taking orders, but if every order is subsequently changed two or three times, management may have cause for concern and want to rectify the inefficiency.

Follow-Up Audits

A product, process, or system audit may have findings that require correction and corrective action. Since most corrective actions cannot be performed at the time of the audit, the audit program manager may require a follow-up audit to verify that corrections were made and corrective actions were taken. Due to the high cost of a single-purpose follow-up audit, it is normally combined with the next scheduled audit of the area. However, this decision should be based on the importance and risk of the finding.

An organization may also conduct follow-up audits to verify preventive actions were taken as a result of performance issues that may be reported as opportunities for improvement. Other times organizations may forward identified performance issues to management for follow-up.

1. Audit planning and preparation: Audit preparation consists of planning everything that is done in advance by interested parties, such as the auditor, the lead auditor, the client, and the audit program manager, to ensure that the audit complies with the client’s objective. This stage of an audit begins with the decision to conduct the audit and ends when the audit itself begins.
2. Audit execution: The execution phase of an audit is often called the fieldwork. It is the data-gathering portion of the audit and covers the time period from arrival at the audit location up to the exit meeting. It consists of multiple activities including on-site audit management, meeting with the auditee, understanding the process and system controls and verifying that these controls work, communicating among team members, and communicating with the auditee.
3. Audit reporting: The purpose of the audit report is to communicate the results of the investigation. The report should provide correct and clear data that will be effective as a management aid in addressing important organizational issues. The audit process may end when the report is issued by the lead auditor or after follow-up actions are completed.
4. Audit follow-up and closure: According to ISO 19011, clause 6.6, “The audit is completed when all the planned audit activities have been carried out, or otherwise agreed with the audit client.” Clause 6.7 of ISO 19011 continues by stating that verification of follow-up actions may be part of a subsequent audit.

The Four Phases of an Audit Cycle

Note: Requests for correcting nonconformities or findings within audits are very common.

• Corrective action is action taken to eliminate the causes of an existing nonconformity, defect, or other undesirable situation in order to prevent recurrence (reactive). Corrective action is about eliminating the causes of problems and not just following a series of problem-solving steps.
• Preventive action is action taken to eliminate the causes of a potential nonconformity, defect, or other undesirable situation in order to prevent occurrence (proactive).

You can also search articles, case studies, and publications for auditing resources.

Books

The ASQ Certified Quality Auditor Handbook

Internal Quality Auditing

Advanced Quality Auditing

Articles

Auditing: It’s All in the Approach (Quality Progress) To effectively use the process approach, organizations and auditors alike must understand the difference between a department and the QMS processes employed in that department, and auditors must be competent in the processes they’re auditing.

Starfish and Turtles (Quality Progress) Regardless of industry, a typical quality program consists of multiple elements, including internal audits. The process grid walk model is an internal audit initiative that features a self-sustainable self-check method with verifiable deliverables at minimum operating cost.

Auditing Strategy For ISO 9001:2015 (Journal for Quality and Participation) Auditing an organization for compliance with ISO standards has two parts: conformance audits and performance audits.

Relating Evidence To Conclusions (PDF) Standards experts and members of U.S. TAG 176 explain that if the intent of an audit is to assess the effectiveness of processes in relation to requirements, auditors must be open to audit a process in relation to the inputs, outputs, and other contributing factors, such as objectives or the infrastructure involved.

Videos

ISO 9000 and Audits

The Changing Role of Remote Audits

ASQ certification is a formal recognition that you have demonstrated a proficiency within, and comprehension of, a specific body of knowledge. In 2016, ASQ Certification exams changed from paper and pencil to computer-based testing via computer at one of the 8,000 Prometric testing facilities, which allows for additional annual exam administrations, greater availability of exam days, faster retesting, and faster test results. Learn more about computer-based testing.

See the Difference Certification Makes 

Obtaining your auditing certification is proven to increase your earning potential.

Results from the 2019 Quality Progress Salary Survey showed that U.S. respondents who completed any level of auditor training earned salaries on average of:

• Quality Improvement Associates (CQIA) – $82,892
• Quality Engineers (CQE) – $101,482
• Pharmaceutical GMP Professionals (CPGP) – $105,346
• Manager of quality/organizational excellence – $108,511
• HACCP Auditors (CHA)

  – 

  $99,150

• Quality Auditors (CQA) earned almost $10,000 more

See the full results of ASQ’s annual Salary Survey.

Adapted from The ASQ Auditing Handbook, ASQ Quality Press.