M. Pharmacy - PHARMACEUTICAL REGULATORY AFFAIRS (MRA) DOCUMENTATION AND REGULATORY WRITING (MRA 102T) Unit 3: Audits - Auditing strategies

1. AUDITING
STRATEGIES
(UNIT – III) MOHAMED FAZIL M
P1821003
M. PHARMACY 1st SEM
REGULATORY AFFAIRS
MOB: 8870884215
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DOCUMENTATION AND REGULATORY WRITING
(MRA 102T)

2. AUDITING
 Auditing is the on-site verification activity, such as
inspection or examination, of a process or quality
system, to ensure compliance to requirements.
 Auditing in simple terms could be defined as
inspection of a process or a system to make sure
that it complies with the requirements of its
intended use.
 An audit can apply to entire organization or might
be specific to a function, process or production step.
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3. AUDITING STRATEGIES
 Audit strategy means the combination of audit
approach to be used , resources management and
allocation , timing of the audit and the way how the
audit engagement is managed.
 For example, the auditor will use risks based audit
approach or top- down approach to conduct audit
assignment.
 Audit strategy normally identifies and set after audit
objective before or at the same time with the audit
plan is performed.
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4. The audit strategy is based on the following
considerations
Reporting objectives Timing of the audit Nature of
communications
Significant factors in
directing
engagement team
efforts
The results of
preliminary
engagement
activities
The knowledge
gained on other
engagements
The nature, timing,
and extent of
resources available
for the engagement
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5. Objective and Purpose of Audit Strategy
To set the scope of the audit engagement
To establish the time frame of the audit
To manage and arrange the audit effectively and correctly
To set the right audit approach
Documentation about Audit methodology
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6. TYPES OF
AUDIT
STRATEGY
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 INTERNALAUDIT STRATEGY
 EXTERNALAUDIT STRATEGY
INTERNALAUDIT STRATEGY:
Internal audits evaluate a company’s Internal control, including its corporate
governance and accounting processes. They ensure compliance with laws
and regulations and help to maintain accurate and timely financial reporting
and data collection.

7. INTERNAL
AUDIT
STRATEGY
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Use Use Technology to Improve
Share Share Your Results
Stay Stay Independent
Invest in Invest in Your Team
Use Use Risk to Build Your Schedule
Lay Lay the groundwork for success

8. 1.Lay the groundwork for
success
 One key idea in quality management is that solid,
thoughtful design leads to the creation of a high
quality product. This idea holds true for both
product and process design.
 So when you’re performing audits, it’s important
to realize that planning and preparation lay the
groundwork for effective internal quality audits.
 There is a link between the effectiveness of your
audit process and the effectiveness of your overall
quality system.
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9. 9
If your audit processes are sound, you are more
likely to be in compliance with regulatory
requirements.
In a recent FDA study, manufacturers with an
adequate quality audit system were in
compliance with approximately 96% of their
GMP requirements.
Those that did not have an adequate audit
system were in compliance with only 70% of
their requirements.

10. 2. Use Risk to Build Your Schedule
Every process not needs to be audited annually.
But most organizations perform annual audits on
most processes.
In reality, organization should conduct audits at a
frequency that matches the risk and importance of
each product or process.
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11. 3. Invest in Your TEAM
Selection is Key
Choosing the right people and
training them well are crucial
steps to building an effective
audit program. The auditors
you choose should be:
•Honest
•Open-minded
•Diplomatic
•Ethical
•Respectful
•Observant
•Flexible
•Decisive
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12. Training Techniques
In addition to preparing by reading and understanding regulatory
standards, SOPs, trends, and reports, auditors may benefit from the
following:
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Performing
Mock
Audits
Competency
Evaluations
Role Playing
Shadowing
Other
Team
Members

13. Don’t Rush to the Lead
 Well-trained, experienced auditors “make
or break” your audit process. So it is
important not to rush auditors onto the
team, or into the role of lead auditor.
 Take the time to train and mentor each new
auditor under the guidance of your more
seasoned team members.
 Effective auditor training can help your
auditors become partners in process
improvement throughout your organization.
ROUND OUT YOUR TEAM
Your audit team can include external
consultants. Adding external resources can be
costly, but can bring new perspectives, industry
best practices, and the assurance of auditor
independence to your internal audit program.
External knowledge can be especially valuable
when you are auditing to a new standard.
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14. 4. Stay Independent
• If you want your internal audits to be
compliant and value-added, they must be
conducted independently.
• “Quality audits shall be conducted by
individuals who do not have direct
responsibility for the matters being audited.”
• Simply put, an auditor cannot audit his own
work.
The
Importance
Independenc
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15. 5. Share Your Results
Requirements for Follow-up
 The audit isn’t over when your checklist is full.
According to the FDA, follow-up and management
review are required steps:
 “A report of the results of each quality audit, and
reaudit(s) where taken, shall be made and such
reports shall be reviewed by management having
responsibility for the matters audits. The dates and
results of quality audits and reaudits shall be
documented.”
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16. Make Reporting Consistent
 As an auditor plan and prepare, form a great team and identify
opportunities for continuous improvement. But the key to communicating
audit results lies in your report.
 Follow-up reports are required for compliance purposes, but are also your
opportunity to share your findings (good and bad) with your management
team.
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17. Audit Reports should be…
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TIMELY PUBLISH
AND SHARE
WITHIN ONE WEEK
CONSISTENT USE A
STANDARD
TEMPLATE EVERY
TIME
CLEAR HIGHLIGHT
AREAS FOR
IMPROVEMENT

18. Tips for effective Audit Reports
 The report with positive observations and comments.
 Create and use a template for your audit report so it will
be consistent and easy to complete every time.
 Cover all of the basics. Be sure to detail audit dates,
areas audited, standard user, lead auditor, audit team, and
names of persons interviewed.
 Focus on your observations and findings, rather than just
presenting checklist results.
 Rank findings by risk to clearly communicate their
importance.
 Use standard terminology for findings, severity, and root
cause for purposes of clarity and later analysis.
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19. 6. Use Technology to Improve
Technology Can Help
 The audit process, especially scheduling and reporting,
can be difficult to manage in a manual system.
 Unless an integrated quality system is in place, most
departments and sites track and trend their own data on
their own systems, marking it hard for management to see
a corporate-wide compliance picture.
 Automated systems allow you to trend, communicate,
share, and innovate in ways that are impossible with
manual systems.
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20. Automated audit management software can help you:
Reduce schedule
conflicts.
Maintain control over
checklists.
Standardize data and
categories for
analysis.
Decrease time
needed to create
audit reports.
Share results
throughout your
organization.
Integrate audit results
with the rest of the
quality system.
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21. EXTERNAL
AUDIT
STRATEGY:
 External audits focus on analyzing the policies and
procedures of a public or private company. While public
companies those offering stock on the open market have
a legal obligation to perform an annual external audit,
private companies have no legal obligation, but often
perform an annual external audit to enhance credibility,
spot inconsistencies and protect against fraud.
 A three step audit strategy allows independent auditor or
an audit team to achieve audit objectives.
 Types of External Audit:
1. Finance audit
2. Compliance audit
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22. EXTERNAL
AUDIT
STRATEGY
Planning
Evidence Gathering
Reporting
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23. 1. PLANNING
 The planning stage is itself a three-step process.
 International standards on auditing, developed by the International
Auditing and Assurance Standards Board, define planning as a
process where auditors first get to know the business and the
environment in which it operates and become familiar with internal
controls, or checks and balances, a business uses to ensure that
financial and operational reports are reliable and that the business is
in compliance with federal and state laws and regulations.
 From there auditors make a risk assessment determination and
create an audit plan for instance, increasing the number of random
calculations or the time frame for observing daily business
activities to address risks uncovered during the planning stage.
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24. 2. EVIDENCE GATHERING
 Evidence gathering includes all the activities external
auditors perform to document and create a chronological
record of business activities, or audit trail.
 This audit trail then becomes the base for creating a final
report.
 On the financial side, auditors inspect financial and
accounting records, perform random calculations and make
comparisons.
 On the procedural side, auditors review standard operating
procedures, talk to members of the management team and
employees and observe daily business activities.
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25. 3. REPORTING
A final audit report is an opinion based on fact.
It consists of three paragraphs in which the external auditor first identifies the type of audit,
explains the audit process and makes responsibility assignments;
Responsibility for the documentation goes to the business, and responsibility for the opinion
goes to the external auditor or auditing team.
The audit was performed according to generally accepted auditing standards and that
appropriate tests and observations were performed and gives specifics as to how the audit was
conducted.
The final paragraph offers an opinion on whether the business financial records are correct or
whether the business is in compliance with federal and state regulations.
An opinion may also include suggestions for correcting or making improvements to business
policies and procedures.
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26. REFERENCES:
 www.pilgrimquality.com – 6 strategies for internal audit success
 Strategy of internal audit function based on the IIA under COSO and COBIT : A
proposed framework, International journal of business and applied social science ,
Dr. Fayhaa Abdullah , Vol.2, Aug 2018
 www.yourbusiness.azcentral.com – external audit strategy
 www.wikiaaccounting.com – audit strategy
 Audit strategy, planning- CA final paper 3 advance auditing, June 2013
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