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GETTING SMARTGETTING SMART ABOUT COMPLIANCE AUDITINGABOUT COMPLIANCE AUDITING
Self Insurers of South Australia (SISA) Presenter: Peter Mills( )Closing the Loop 201430th July’14
Chief Executive Officer Compliance Master International Pty Ltd
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VICTORIAN GOVERNMENT’S SMART‐METER PROGRAM
Smart Meters are t f Vi t i thsmarter for Victoria, the
environment and you.
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SMART METER WARNING – CURRENT AFFAIR AUSTRALIA 24TH JAN 2013
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ROLLOUT RISK CONTRACTOR / EMPLOYEE NON‐COMPLIANCE
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NEW RISK CONTROLS
T i i t• Training centre
• New work procedures
• New certification process
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MONITORING RISK CONTROL EFFECTIVENESS
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LAGGING V.S. LEADING CONTROL INDICATORS
PROACTIVE REACTIVE
RISK EVENT(Eg. Injury)( g. Injury)
Leading Indicators
LaggingIndicatorsIndicators Indicators
Eg: Eg: • Lost Time Injuries• Near Misses
• Compliance with work Instructions• Compliance with quality standards
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TYPICAL AUDITING METHODOLOGY
ProcessAudit Population (Items /Activities)
ProcessGroup Supplier
ImproveCorrectMitigate
l
Mitigate
SampleSample Size (Examples)Fixed Percentage = 5%
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Fixed Number = 200
SAMPLE SIZE MATTERS
ProcessAudit Population (Items /Activities)
ProcessGroup Supplier
ImproveCorrectMitigate Compliant
l
Mitigate p
Noncompliant
SampleSample Size (Examples)Fixed Percentage = 5%
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Fixed Number = 200
SAMPLE SIZE MATTERS
ProcessAudit Population (Items /Activities)
ProcessGroup Supplier
ImproveCorrectMitigate Compliant
l
Mitigate p
Noncompliant
SampleSample Size (Examples)Fixed Percentage = 5%
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Fixed Number = 200
STRIKING THE CORRECT BALANCE
Auditing BusinessAuditing Costs
BusinessRisks
• Sample Size
• Employee noncompliance
• Product• Frequency • Product noncompliance
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IDEAL AUDITING SYSTEMA diAudit
Sample Size
Auditing System
C li P fN li Ri kA dit P l ti
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Compliance PerformanceNoncompliance RiskAudit Population
ACCEPTANCE SAMPLING
Australia Britain India France GermanyInternational USAAS 1199:1 BS 6001:1 IS 2500:1 NF06‐022
yDIN 40080ISO 2859.1 ANSI/ASQ Z1.4
Sampling procedures for inspection by attributes
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ACCEPTANCE SAMPLING (AS1199.1) SYSTEMA diAudit
Sample Size
Yes
NoAcceptance SamplingAudit Results
Outcome (Target Achieved?)
No
C li P fC li T tA dit P l ti
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Compliance PerformanceCompliance TargetAudit Population
E.g. 95%
ACCEPTANCE SAMPLING (AS1199.1) SYSTEMA di Normal = 80E gAudit
Sample Size
Normal = 80Excellent = 32
Poor = 100
E.g.
Yes
NoAcceptance SamplingAudit Results Outcome (Target Achieved?)
No
C li P fC li T tA dit P l ti
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Compliance PerformanceCompliance Target
E.g. 95% Normal Excellent PoorAudit Population
OBJECTIVE PERFORMANCE ASSESSMENT
Group “A” Group “B” Group “C”
Normal P f
Excellent P f
Poor P fPerformance Performance Performance
OBJECTIVE PERFORMANCE ASSESSMENT
Contractor “A” Contractor “B” Contractor “C”
PoorP f
Excellent P f
NormalP fPerformance Performance Performance
INTANGIBLE BENEFITS
• Employee morale
• Contractor performance
• Management assurance
• Regulator assurance• Regulator assurance
• Customer service
• Company image
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‹#›
THE FUTURE OF COMPLIANCE AUDITING
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