Integrity In Auditing
By Dennis AuBuchon
Decision to audit
Integrity in auditing involves several aspects and each one is just as important as another. When integrity exists in all phases of the auditing process the result is an audit that exhibits accuracy, completeness and honesty. Conversely, these are key ingredients to have integrity in the audit process. There are the preparation phase, performing phase, report and follow-up. All of these activities are important and each must have integrity when performing them. The purpose of this article is to present information, which signifies how audits must have integrity and the impact when they do not.
Integrity in the decision to audit is critical. This decision must be based on an honest evaluation of the facts and circumstances. For example, today many companies in the U. S. and the world have either a contractual requirement or procedural requirement to have an ISO 9000 quality system. Some companies perform audits on their suppliers. This decision should be made on need not on the location, or auditing in Las Vegas or Hawaii rather than Bismarck, ND. If an audit is scheduled simply for the location, the integrity of the audit may come into question.
The preparation process of an audit is critical for the success of an audit. The first key decision to be made is deciding where an audit will be performed, whether onsite or offsite. Another decision is the composition of a team, if one is required. The number of elements to audit and the time required to review and analyze them should be considered to decide how many auditors are required. If there is an insufficient number of auditors available to perform a reliable review, the results can or will be questioned. Another required decision is assurance that team members have the necessary qualifications to audit against the requirement. This is necessary to ensure a valid conclusion is made based on the facts reviewed. To some extent any certified auditor can perform an audit against requirements and verify compliance or non-compliance. American Society for Quality (ASQ) certification indicates that auditors have demonstrated knowledge of the auditing process. This type of recognition provides some basis to determine an auditorís qualifications. Other qualifications would involve such things as education, training and work experience.
Part of this phase may involve obtaining clarification if a requirement is vague or can have multiple interpretations. The clarification must be received from an approved/recognized source. Sometimes organizations generating requirements have official interpretations available. Where they are available, auditors should have this information to help them in performing their tasks and drawing conclusions.
The next phase involves establishing an audit schedule including team assignments.
The auditee may have concerns about confidentiality. This may involve the signing of an agreement that any information reviewed will be kept confidential. Agreeing to this arrangement, where requested, helps to project the appearance of integrity in the audit process.
Performing an audit involves several components and integrity must be present in each of them if there is to be integrity in the results. The subsequent paragraphs will discuss documentation, schedule, focus, and connecting any nonconformance to a requirement. Finally, a caution about making recommendations is discussed.
When performing audit activities and drawing conclusions details must be recorded. Examples of needed documentation include information such as the time period, people contacted, documents reviewed and operations witnessed. Without this kind of information, the results and the report may be questioned in the future. A finding without documentation will not stand as being valid. The responsibility of an auditor is to review, evaluate and make a decision based on the facts. If an auditor does this, the results of the audit are more likely to have integrity.
Staying on schedule is important in completing an audit. The schedule is the mechanism to assure that the entire scope of the audit is completed. If more time is needed to evaluate a particular element, a decision must be made to adjust the schedule. The audit team leader and/or the organization that requested the audit must make this decision. Changes in the schedule or scope of the audit may jeopardize the accuracy and integrity of the audit. These changes may also hurt the integrity of an auditing organization and the auditor. The auditorís reputation may indicate a lack of thoroughness and that the auditor does not exhibit the characteristics of integrity. These characteristics may call into question a lack of accuracy, completeness, truthfulness, and soundness.
Focus is another critical issue during the audit. Auditors must stay focused on the task to which they are assigned. The lead auditor is responsible to ensure that the team completes their tasks in the time scheduled. Team members are responsible to complete their assigned tasks. Each auditor must stay focused to the scope of the audit and only make any changes if the scope is amended by proper approval. Staying focused helps to add credibility to the audit and the auditors.
A critical area in adding integrity to auditing is to assure any identified nonconformance has a clear connection to a requirement. It can be contractual or procedural. If they are in violation, it is a valid nonconformance and should have a finding generated. A notation of the requirement should be made with the documentation of the incident. This provides details for support for any result and increases the integrity of the audit.
The last item to remember is a caution to avoid making recommendations on how to correct any discrepancies. An organization can blame the auditor if they take the action on recommendations and it does not work. The auditor must stay within his/her assigned duties, which is to review and decide if the organization is complying with the requirements of the element. It is the responsibility auditee and their staff to make the necessary corrective actions. Do not fall into the trap of giving an opinion or making a decision before the facts are evaluated.
Finally, when performing an audit the auditor should always be pleasant and not combative. Be persistent in pursuit of fact based information. Record information accurately and completely. Remember it is the duty of an auditor to document any discrepancies when they are found. Also when investigating a situation, if you are not satisfied with a response you receive from a question, ask more questions until you are satisfied. This is necessary to have a proper evaluation of an area and helps to instill integrity in the results. Sometimes the auditee provides vague answers intentionally. When this type of response occurs, auditors must make sure that any answers received are clear and directly relate to the question.
The final report of the audit must be accurate, complete and reliable to have integrity. All information regarding any nonconformance must have the details to satisfy traceability requirements. The report must have a record of all activities performed or references of supporting documentation for the results. A complete and accurate final report provides guidance for future activities and reinforces the integrity of the auditor and client.
After an audit is completed, a follow-up is necessary to verify all requests for corrective action are properly completed. This is important to assure integrity is maintained until the audit is closed. If actions are required to be taken and are not validated after the audit, then integrity may or will be considered lacking. This is especially true if a discrepancy occurs in the future related to previous audit results.
It is important to remember all the activities and decisions discussed above helps to assure the integrity of any audit that is performed. If the elements of honesty, completeness and accuracy are present in an audit, the report should provide written proof through specific detail to make the results inherent and visible. It is important that each auditor make every effort to instill integrity in every audit. When the appearance of integrity in audits is evident, it not only supports a positive image of the company performing the audit but also the reputations of the auditor.
The information in this article is limited in nature as the complexity of completing any audit has variables. Below are additional sources of information that may be used to learn more about the subject of integrity.
AuBuchon, Dennis, Integrity: Do You Have It. [order from Iuniverse.com] 2003
Duffy, Grace, Quality Management Forum article in 2004 on integrity
Bracher, James and Daniel E. Halloran, Integrity Matters. Badger CA: Torchlight Publishing, 2004
Carter, Stephen, Integrity, New York: BasicBooks, 1996
Gostick, Adrian and Dana Telford, The Integrity Advantage: How Taking the High Road Creates a Competitive Advantage in Business, Layton Utah: Gibbs Smith, 2003
Johnson, Larry and Bob Phillips, Absolute honesty : building a corporate culture that values straight talk and rewards integrity, New York : American Management Association, 2003.
Quality Progress October 2003
Anderson, Bjorn, Bringing Business Ethics to Life: Achieving Corporate Social Responsibility
Batten, Joe, Building a Total Quality Culture ISBN: 1560521767 ISBN: 1560521767Item P973 through ASQ Published 1993
Tichy, Noel M. and McGill, Andrew R, Editors, The Ethical Challenge: How to Lead With Unyeilding Integrity ISBN: 07879676X Item P1035 through ASQ, Published 2003
ASQ Code of Ethics, Copyright 1970 ASQC, Quality Progress Vol 3, No. 7 July 1970, p.16
ASQ web site Article "Confessional" Advertising: Start of a Trend
ASQ web site Article: Ethical Leadership and Public Confidence: A Q & A With Manu Vora India September 2002 Ė Kanchana Suggu, Senior Editor
Arter, Dennis; Russell, J.P., Ethics, Auditing and Enron, Copyright 2003 ASQ Quality Progress, Vol 36, No. 10 October 2003 pp. 34-40 (Article free for ASQ Members)
Meyer, Charlene, Column In My View: Do Sweat the Small Stuff, Copyright 2003, AQP
Journal for Quality And Participation, Vol 26, No. 1 March 2003, pp. 31-32
Brandl, Patty, Maguire, Miles; Code of Ethics: A Primer on Their Purpose, Development, and Use, Copyright 2002, AQP Journal for Quality and Participation, Vol 25, No. 4 December 2002, pp 9-12 (Free to the general public on the journals web site
AuBuchon, Dennis, Integrity: Do You Have It. [order from Iuniverse.com] 2003
Dennis AuBuchon worked for the government more than 35 years and had various positions including functional leader, audit team leader and facilitator. He is the Region 9 Quality Audit Division Councilor and has been a certified quality auditor since 1992. He is author of a book titled, Integrity: Do You Have It? available at Iuniverse.com. AuBuchon can be reached through his web site www.myqualitywriting.com.