work related issue

[messengerhot]

Our company will undergo internal audit in a few weeks time and I've been hearing the word corrective and preventive action at work. I googled it and according to google these are improvements to an organization's processes taken to eliminate causes of undesirable situations. Can anyone please explain it further?

What is the difference between corrective and preventive action? How do you document and control corrective and preventive actions, is there some kind of software you can use?

[Ultralight]

This is not going to go well. Sorry this is happening.

[printslicker]

Internal auditing is important in any organization and for what I know, corrective and preventive actions are a part of a successful audit management. In my opinion, corrective action refers to the action taken to eliminate the causes of risks while preventive is done to reduce the possibility of any risks or even eliminate undesirable events that might occur. I just thought that a certain software could provide the help to implement the necessary guidelines in terms of those actions to be done effectively.

[messengerhot]

Any ideas which software is good to use? I was asked to look for one and then to create a proposal. I've been calling my friends and they only know of this. My friend said they used it for corrective action preventive action in their company before. I'd like several options though before I start calling companies. Anyone?

[ToomuchStuff]

A quick google search, turned up many. The problem is finding someone who has both used one, and hopefully done everything you need, and a few you don't realize you need.
But with my open source preference, I added that to my search, and I found one that you can look at, and even apparently try online.
http://phkapa.net/
If your company is large enough to have other needs, since it is open source, you could modify it.

[SteveinMN]

Our company will undergo internal audit in a few weeks time and I've been hearing the word corrective and preventive action at work. I googled it and according to google these are improvements to an organization's processes taken to eliminate causes of undesirable situations. Can anyone please explain it further?

I did some auditing in a previous job. Corrective actions are those taken to rectify issues which have been executed. Preventive actions are those instituted to prevent the problem that created the need for corrective action.

For example, if an accountant made an assumption in preparing a company's annual financial results and that assumption turned out incorrect (illegal, unaware of a contingency, etc.) but greatly inflated the value of the company, a corrective action would be to issue a restated financial report with the error fixed. A preventive action would be to formalize the way the accountant should have interpretated the information (s)he had, so that the assumption does not result again in overstated value whether the reporter is the accountant who assumed wrong or any other accountant working on those reports.

How do you document and control corrective and preventive actions, is there some kind of software you can use?

Frankly, you could even use a word processor or a spreadsheet -- anything that could generate a table. All you really need is a list of the items discovered during the audit and, alongside them, the recommended corrective and/or preventive actions, and some space to indicate what action was taken when and by whom. While it would be spiffy to use workflow-management software which would allow for electronic signatures and polls of delayed responses and all, it isn't necessary.

[LDAHL]

Because of the nature of my job, I've had to both perform and undergo hundreds of audits over the years. Except for the few rare cases of political scalp-hunting, I think that with the proper amount of preparation and cooperation, you can often turn them to your advantage. Shy of gross negligence on your part, audit findings can often be useful.

For instance, they might point out you are operating with inadequate staff resources or outdated software, which can be useful ammunition at budget time. Issues you might have been decrying for years get added credibility when pointed out by a third party. You can often subtly steer auditors in favorable directions if the facts are on your side.

They might also compare your performance favorably with similarly situated organizations. Our organization has a "Aaa" bond rating, for instance, and you can be sure people hear about the "superior financial management" cited in the credit report.

They may also highlight issues you may need to know about and fix. A law or accounting principle changing the way you treat pension obligations or cell tower leases might be very good to hear about, especially before they become a larger problem.

[lhamo]

I got involved at the tail end of an internal audit of our office a few years ago. My former boss (who was leaving and I was stepping in for temporarily) had a reputation of running one of the cleanest offices in the organization. But the auditor basically HAD to have something in the report, so they went after our petty cash management system, which technically was not in compliance with the organizational policies (but did make total sense in light of how cash-focused Chinese transactions were at the time). We had both corrective and preventative actions I had to follow up with -- drafting new policy specific to our office, getting it approved by the Controller's, and adjusting the amount actually kept n petty cash.