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Audit Checklist

52

Volume II

(Part-B)

Audit Checklists

Audit Manual

m March 2015March

2015

Audit Checklist

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Contents

Volume II

Part B - Audit Checklists

Guidelines for Audit Checklist ............................................................................................................... 56

Internal Audit ....................................................................................................................................... 57

1. Administration – Internal Audit .......................................................................................................... 58

2. BP Coach–Internal Audit ................................................................................................................... 65

3. Chemical – Internal Audit .................................................................................................................. 69

4. Civil – Internal Audit .......................................................................................................................... 72

5. Contracts – Internal Audit.................................................................................................................. 79

6. Crisis Management Team – Internal Audit ........................................................................................ 90

7.Drilling ................................................................................................................................................ 94

7a. Technical Services (Drilling) – Internal Audit .................................................................................. 99

8.Electrical – Internal Audit ................................................................................................................. 102

9. Employee Relations – Internal Audit ............................................................................................... 106

10.ERP – Internal Audit ....................................................................................................................... 123

11. Exploration & Development (ED) – Internal Audit ......................................................................... 125

12. Field Communication – Internal Audit ........................................................................................... 130

13. Field Engineering – Internal Audit ................................................................................................. 132

14. Finance & Accounts ...................................................................................................................... 134

14.IA.1 Finance & Accounts – Asset Management ............................................................................ 134

14.IA.2 Finance & Accounts - Costing ................................................................................................ 139

14.IA.3 Finance & Accounts - Payables .............................................................................................. 142

14.IA.4 Finance & Accounts – Taxation .............................................................................................. 146

14.IA.5 Finance & Accounts – Treasury ............................................................................................. 149

14.IA.6 Finance & Accounts – Financial Planning & Analysis ............................................................ 156

14.IA.7 Finance & Accounts – JV Operated ....................................................................................... 161

14.IA.8 Finance & Accounts – JV Non Operated ................................................................................ 166

14.IA.9 Finance & Accounts – Financial Reporting ............................................................................ 171

14.IA.10 Finance & Accounts – Payroll ............................................................................................... 175

14.IA.11 Finance & Accounts – Receivables ...................................................................................... 178

14.IA.12 Finance & Accounts – Insurance .......................................................................................... 182

15. Geology & Reservoir – Internal Audit ............................................................................................ 185

16. Geophysics – Internal Audit .......................................................................................................... 187

17. Human Resources ........................................................................................................................ 189

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18. Information Technology …………………………………………………..........................................206

19. Instrumentation – Internal Audit .................................................................................................... 210

20. Land – Internal Audit ..................................................................................................................... 212

21. Learning & Development – Internal Audit ..................................................................................... 219

22. Legal – Internal Audit .................................................................................................................... 223

23. LPG Plant - Internal Audit ............................................................................................................. 227

24. Materials Management – Internal Audit ........................................................................................ 229

25. Medical – Internal Audit................................................................................................................. 249

26. Pipe Line Fields – Internal Audit ................................................................................................... 255

27. Planning – Internal Audit ............................................................................................................... 257

28. Production Gas – Internal Audit .................................................................................................... 260

29. Production Oil – Internal Audit ...................................................................................................... 265

30. Production Projects – Internal Audit .............................................................................................. 269

31. Projects – Internal Audit ................................................................................................................ 272

32. Public Relations and Corporate Communication – Internal Audit ................................................. 277

33. Research Development – Internal Audit ....................................................................................... 282

34. Safety Environment – Internal Audit ............................................................................................. 284

35. Security – Internal Audit ................................................................................................................ 286

36. Transport – Internal Audit.............................................................................................................. 292

37. Well logging – Internal Audit ......................................................................................................... 297

38. Business Development – Internal Audit ........................................................................................ 299

39. Corporate affairs – Internal Audit .................................................................................................. 302

40. Secretarial – Internal Audit ............................................................................................................ 306

41. Centre of Excellence – Internal Audit ............................................................................................ 309

42. PHQ OIL Movement – Internal Audit ............................................................................................ 312

43. PHQ Pipeline – Internal Audit ....................................................................................................... 315

44. PHQ – Pump Stations – Internal Audit .......................................................................................... 318

45. Kolkata Shipping Office – Internal Audit ....................................................................................... 321

46. Wind Energy – Internal Audit ........................................................................................................ 327

Technical Audit ................................................................................................................................. 329

3. Chemical – Technical Audit............................................................................................................. 330

4. Civil – Technical Audit ..................................................................................................................... 335

5. Contracts – Technical Audit ............................................................................................................ 339

7. Drilling – Technical Audit................................................................................................................. 343

7a. Technical Services (Drilling) – Technical Audit ............................................................................. 350

8. Electrical – Technical Audit ............................................................................................................. 354

11. Exploration & Development (ED) – Technical Audit ..................................................................... 359

12. Field Communication – Technical Audit ........................................................................................ 366

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13. Field Engineering – Technical Audit ............................................................................................. 370

15. Geology & Reservoir – Technical Audit ........................................................................................ 376

16. Geophysics – Technical Audit ....................................................................................................... 386

19. Instrumentation – Technical Audit ................................................................................................. 391

20. Land – Technical Audit.................................................................................................................. 395

23. LPG Plant - Technical Audit .......................................................................................................... 397

24. Materials Management- Technical Audit ....................................................................................... 406

26. Pipe Line Fields – Technical Audit ................................................................................................ 411

27. Planning – Technical Audit............................................................................................................ 418

28. Production Gas – Technical Audit ................................................................................................. 421

29. Production Oil – Technical Audit ................................................................................................... 442

30. Production Projects – Technical Audit .......................................................................................... 459

31. Projects – Technical Audit............................................................................................................. 467

33. Research Development – Technical Audit .................................................................................... 472

34. Safety Environment – Technical Audit .......................................................................................... 476

36. Transport – Technical Audit .......................................................................................................... 481

37. Well logging – Technical Audit ...................................................................................................... 484

38. Business Development – Technical Audit..................................................................................... 490

42. PHQ OIL Movement – Technical Audit ......................................................................................... 492

43. PHQ Pipeline – Technical Audit .................................................................................................... 496

44. PHQ – Pump Stations – Technical Audit ...................................................................................... 501

46. Wind Energy – Technical Audit ..................................................................................................... 505

ERP ..................................................................................................................................................... 507

10. ERP – ERP ................................................................................................................................... 508

18. Information Technology – ERP ..................................................................................................... 512

24. Materials Management- ERP ........................................................................................................ 519

Part C - Risk Control Matrices 522-555

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Guidelines for Audit Checklist

1. The checklists are guidelines and should be used after analyzing the applicability of the same

during audits. In case a department has multiple sections, the relevant steps from the checklists

have to be used for all sections.

2. SAP T-codes provided are standard. In case of any SAP customization, customized T-codes to be

used after discussion and understanding with process owners.

3. Audit should be conducted by utilizing SAP data and functionality. However, in case manual

controls are present, then manual checks should be reviewed.

Sampling Methodology

Frequency of control activity Minimum sample size

Example Risk of failure

Lower Higher

Annual 1 1 Annual Physical Verification of Inventory

Quarterly (including period- end, i.e., +1)

1+1 1+1

Monthly 2 3 Monthly provisioning of expenses

Weekly 5 8

Daily 15 25 Daily closing of cash book

Recurring manual control (multiple times per day)

25 40 Vouching

Note: Sample sizes stated above may be increased in following scenarios:

1 Failure by more than 10% in existing sample selected.

2 An increase in the internal auditor’s assessment of the risk of material misstatement

3 An increase in the amount of error which the internal auditor expects to find in the population

4 An increase in the internal auditor’s required confidence level

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Internal Audit

Audit Checklist

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1. Administration – Internal Audit Scope

Audit Areas

1 Planning, budgeting & monitoring

2 Equipment/ vehicle/ Company owned flats management and maintenance

3 Regulatory and statutory compliance

4

Contracts monitoring 1. Vehicle contracts 2. Civil & Electrical, Security and Labor Contracts 3. Any other contracts

5 Accommodation

6 Administration activities

7 Hospitality services such as hotels, car vendors etc.

8 Loans and benefits

9 Medical benefits

10 Logistics & stay

11 Liaison and boundary management

12 Complaints management

13 PR tracking

14 Creation of Service Entry Sheet (SES)

15 Manpower planning

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1. IA.1 Planning, Budgeting & Monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,

compliance to DOP Nature of Work Step Analysis / Verification Risk 1. Inappropriate approvals. 2. Delays in preparation of budget. 3. Non compliance to DOP. Nature of Control Automated/Manual

1. Check whether the annual plan of administration department is complete and all-inclusive to cover the requirements of all the activities that come under its purview such as accommodation, maintenance of guest house, medical facilities, vehicles, housekeeping, security, holiday homes etc.

2. Use T-Code KSBL and enter cost center to get budget. 3. In version management check the changes done in the budget. 4. Check for appropriate approval as per DOP for the budget and subsequent changes. 5. Check whether annual plan made is -

a. Linked to the requirement of various departments. b. Inclusive of all the related costs

6. Check the timelines for preparation and approval of budget. 7. Use T-Code S_ALR_87013532 by entering cost center to check whether actual expenses are

monitored / compared with planned expenses on periodic basis.

1. IA.2.1 Equipment / vehicle / Company owned flat management and maintenance Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Verification Risk Low utilization

Nature of Control Automated / Manual 1. Check whether the utilization of equipment/ vehicle/ company owned flat is reviewed regularly.

Use T-Code IE03 and enter equipment number for equipment/vehicle and manually check the records for company owned flats.

2. Check whether there is a maintenance schedule (preventive/regular) for equipment/vehicle/ company owned flat and its compliance. Use T-Code IP24 and enter equipment number to get maintenance schedule for equipment/vehicle and manually check the records for company owned flats.

3. Check whether monitoring over turn around time as per schedule and actual time taken for maintenance of equipment/ vehicle/ company owned flat is done.

4. Check whether monitoring is done for compliance to OEM guidelines.

1. IA.2.2 Equipment / vehicle / Company owned flat management and maintenance Control Objective Ensure adequate and timely building maintenance

Nature of Work Step Verification Risk No maintenance or delays in maintenance. Nature of Control Automated/ Manual

1. Check whether CPWD maintenance manual is used for reference for miscellaneous maintenance. 2. Check whether a control is maintained on the AMCs that exist with different vendors for

maintenance of other air conditioning systems (other than indoor Acs). Use T-Code ME2S/ME3N to verify AMC using AMC number.

3. Check if there is inadequate maintenance or high cost of maintenance. 4. Check whether AMC is done and renewed as and when due.

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1.IA.2.3 Equipment / vehicle / Company owned flat management and maintenance Control Objective Preventive maintenance of vehicles is scheduled to avoid excessive

breakdowns Nature of Work Step Verification

Risk Excessive breakdowns. Nature of Control Manual / Automated

1. To check whether periodic servicing is performed. Use T-Code IP24 and enter equipment number to see maintenance schedule.

2. Check whether management’s approval is taken and quotations are obtained so as to maintain the proprietary vendor’s servicing schedule.

3. Check that the preparation time taken by civil department is not exceeding defined time limit.

4. To understand the process of stacking of location and identify gaps.

5. Check whether G&R department is timely intimated in case, the specified coordinates cannot be stacked.

6. Check whether LAF-2 is timely approved and sent to the G&R department along with the required estimate for civil job.

7. Check whether cost estimate is prepared by the department before submission of LAF-2.

1.IA.3 Regulatory and statutory compliance Control Objective Adherence to applicable Rules and Regulationss

Nature of Work Step Verification

Risk Initiation of penal action by concerned authorities. Nature of Control Manual

1. Check whether there is compliance framework to monitor or track compliance required under various law/Acts applicable to the Company.

2. Verify whether compliance of applicable rules/provisions e.g. Minimum Wages Act 1948, Employees' State Insurance Act 1948 are monitored periodically.

3. Check whether non compliance to the requirements is reported to the management periodically for further action.

4. Check whether there is compliance of statutory requirements by contractors. 5. Check whether statutory compliance reports are submitted.

1.IA.3.1 Compliance to contracts Control Objective Completeness of PR raised and Timely renewal of contracts Nature of Work Step Verification / Analysis Risk 1.IA.Incomplete PR.

2. Delays in renewal. Nature of Control Manual / Automated

1. Check whether the PR is raised as per the process mentioned in Contracts Manual/JOA/PSC with appropriate approvals. Use T-Code ME5A and enter plant code and period to generate list of service related PR created during the audit period.

2. Check whether PR is accompanied with minimum details as required by Contract Manual such as detailed of scope, amount of approved estimated cost, budget provisions & management approvals, detailed technical specifications, Schedule of quantities, the approved BRC/BEC, nature (revenue or capital or special revenue), date by which the award of contract is required and time for completion of work are specified in the PR. Use T-Code ME53N and enter PR number to view details pertaining to specific PR.

3. For renewal cases check timeliness for raising the PR.

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1.IA.3.2 Compliance to contracts Control Objective Compliance to contract is ensured Nature of Work Step Verification/Analysis Risk Non-compliance to contractual terms. Nature of Control Manual/ Automated

1. Use T-Code ME23N or ME2S to view details of the contracts issued by entering PO number or contract number respectively.

2. Check the adherence to different contractual terms. 3. Take samples to cover Vehicle Contracts, Civil & Electrical, Security and Labor Contracts or any

other contracts entered by administration department. 4. Check whether all contractor's bills have been certified as per the contractual terms. 5. Check Service Entry Sheets (SES) have been created in SAP for the services received -

Timeliness and Accuracy.

1.IA.5 Accommodation Control Objective To verify that allotment of quarters are made according to eligibility criteria. Nature of Work Step Verification Risk Non compliance to internal policy and procedure may lead to employee

dissatisfaction. Nature of Control Manual

1. Obtain a list of flats allotted during the audit period. For a sample, check the eligibility criteria. 2. Check compliance to laid down Policies Application form for allotment of colony quarters. 3. Obtain Designation, date of joining OIL, date of joining region / Project and check whether

allotment of accommodation is as per the eligibility criteria. 4. Obtain the waiting list of people awaiting allotment and review aging of the same. 5. Check that no out of turn allotments have been made without approval of competent authority. 6. Compare the waiting list with the list of vacant flats available to check whether any allotments

could have been made. 7. Report discrepancies found, if any.

1.IA.6 Administration Activities Control Objective Effective implementation of activities (in-house/outsourced) Nature of Work Step Verification Risk Inefficiency in implementation. Nature of Control Manual

1. Check whether checklists are available to monitor the in-house/outsourced activities. 2. Check whether there is efficiency in the services provided by the contractors is as per the

contractual terms. 3. Check whether control is kept on the cost of services. 4. Check whether the cost of running and maintenance of DG sets or any other administration

utilities are monitored.

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1.IA.7 Hospitality services such as hotels, car vendors etc. Control Objective Effective implementation of activities

Nature of Work Step Analysis / Verification Risk Inefficiency in implementation. Nature of Control Automated / Manual

1. Check whether the processing of vendor bills is correct. MIR4 can be used to display the posted invoice and the same will be reflected in purchase order history of a purchase order which can be referred via T-Code ME23N.

2. Check whether there is payment to vendors is equivalent to the amount due, to ensure there is no overpayment / duplicate payment. Use T-Code FBL1N and enter vendor code.

3. Check that selection of vendor with higher rates does not take place.

1.IA.8 Loans and benefits Control Objective Compliance to the policies Nature of Work Step Verification Risk Non compliance to internal policy and procedure may lead to employee

dissatisfaction.

Nature of Control Manual 1. Check the processing of authorized loans / allowances. 2. Check that applications received are complete and as per eligibility criteria. 3. Check that application received is supported by required documents. 4. Check whether a formal checklist is maintained for all the steps during processing of loans. 5. Check the process of receiving application, its processing and review of pending applications. 6. Check whether all documentation is maintained in loan file as required by policy, subsequent to

disbursement. 7. Check the incidents wherein non recovery of loans has taken place. 8. Check whether timely Management approval is taken.

1.IA.9 Medical benefits Control Objective Compliance to the policies Nature of Work Step Verification Risk Non compliance to internal policy and procedure may lead to employee


1. Check whether processing of bills is as per the defined policy and criteria. 2. Check the processing time taken and if measures are undertaken to minimize it. 3. Check that applications received are correct and supported by required documents. 4. Ensure that application is not misplaced during transit of correspondence. 5. Check whether proper follow up is done with employee's parent department and medical

department. 6. Check whether the payment of charges is covered by Company's policy. 7. Check whether confirmation from the concerned hospital is obtained timely. 8. Check whether management approval is taken timely.

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1.IA.10 Logistics and stay Control Objective Compliance to the policies Nature of Work Step Verification Risk Non compliance to internal policy and procedure may lead to employee


1. Check that no ticket of higher cost has been booked and appropriate process exists for comparing fares and obtaining approvals as per policy.

2. Check whether refundable tickets are booked wherever possible. 3. Check whether there is a policy for accommodation/ car rental etc. 4. Ensure that hotels/guest houses/cabs booked are as per the policy and within the allocated

price band. 5. Ensure that all requisitions for logistics and stay are raised as per policy and approved as per

DOP. 6. Check the number of incidents where cancellation charges have been paid and whether these

incidents are monitored and controlled.

1.IA.11 Liaison and boundary management Control Objective Timely liasoning with authorities for VIP movement and public functions at

OIL. Nature of Work Step Verification Risk Disputes / incidents. Nature of Control Manual

1. Check whether information is timely received. 2. Check if there is adequate intra-departmental correspondence. 3. Check whether timely liasoning is done with District and Police Administration. 4. Check whether management approval is obtained timely.

1.IA.12 Complaints management Control Objective Effective complaints resolution and handling Nature of Work Step Verification Risk Employee dissatisfaction. Nature of Control Manual

1. Check whether steps are undertaken to minimize grievances. 2. Check whether grievances are addressed properly. 3. Check whether timely action is taken for Grievance disposal. 4. Check whether timeline is set for every stage of grievance process. 5. Analyze open complaints and reasons of their delays.

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1.IA.13 Creation of Service Entry Sheet (SES) Control Objective Exploiting the best option available Nature of Work Step Analysis / Verification Risk 1. Delays in payments.

2. Incorrect payments. Nature of Control Automated/Manual

1. Check whether status of work completion in measurement book is updated. Use T-code ME2S/MSRV1.IA.

2. Check whether confirmation or acknowledgement of work completed is taken from contractor on measurement book.

3. Check whether the measurement book is verified and approved by concerned authority. 4. Use T-Code ML84 to view the list of SES's and ML81N to view the details of specific SES. Check

whether the SES for the services received is timely prepared. 5. Check whether proper technical survey/inspection is carried out for quality assurance before

creation of SES. 6. Check whether the technical inspection carried out is approved as per DOP. 7. Check whether there is a process of monitoring the date of completion as mentioned in the

contract w.r.t the actual date of completion/creation of SES. 8. Check whether reasoning analysis is done for the delays and steps are taken to avoid similar

delays. Check whether cost benefit analysis is done for buying vis a vis hiring of equipment or tools.

1.IA.14 PR Tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Analysis / Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /

operational delays. Nature of Control Automated / Manual

1. Use T-Codes ME53N and ME5A to check whether PRs for spares/materials/jobs are raised timely.

2. Check whether approvals for PRs, issue of spares/materials and conducting jobs are taken as per DOP.

3. Conduct lead time analysis between PR initiation and release. Ensure that reasoning analysis is conducted for delays.

4. Check whether there is a process of reviewing pending PRs and whether a follow-up process with Contracts/Material Management exists.

1.IA.15 Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Analysis / Verification Risk 1. Over/Under-utilization of manpower.

2. Operational delays caused due to low manpower. Nature of Control Manual

1. Check whether there is adequate manpower to carry out all the operations of the department - administrative and technical.

2. Ensure manpower requisition forms are raised timely and approved as per DOP. 3. Check whether there is a follow up process in place to ensure timely conversion of MPR.

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2. BP Coach–Internal Audit Scope

Audit Areas

1 Need identification

2 Trainings - planning & execution

3 Planning & administration

4 PR tracking


6 Manpower planning

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2.IA.1 Need Identification Control Objective To ensure employees and organizational development Nature of Work Step Verification Risk Gap in employees and organizational development. Nature of Control Manual

1. Check the periodicity of conducting BP Coach training and whether schedule has been developed as per the training requirements.

2. Check whether option of self nomination is provided to employees for trainings and the same is being used effectively for skill upgradation.

3. Check if the nominations for training is based on the need assessment and duly approved by HOD.

2.IA.2 Training – planning and execution Control Objective To develop employee soft skills and all around development Nature of Work Step Verification / Analysis Risk Untrained Employees.

Nature of Control Automated / Manual 1. Check whether training calendar have been formulated for the year / quarter. 2. Check whether training calendar is prepared on the basis of need identification and organizational

requirements considering the long term goals. 3. Check if the training calendar is approved as per the DOA. 4. Check whether the training plan is communicated and circulated well in advance. 5. Check whether all the trainings are conducted as per the plan. 6. Check any deviations from the defined calendar are approved and communicated in advance. 7. Check whether the training feedback is obtained, analyzed and considered for future planning. 8. Check if process of evaluating the training benefits is followed. 9. Check the list of actual participants with the registered participants. Use T-Code S_PH9_46000433. 10. Check if there are employees who have not been nominated for training for long period and

conduct reason analysis for same. 11. Check if the absences from training are properly documented and required approvals are obtained

by the employee for not attending the training. Use T-Code S_AHR_61016216. 12. Check whether any root cause analysis is being carried out for low participation level in the

trainings. 13. Check the process of identification, selection and payment to trainers. Use T-Code MIR4, FBL3N. 14. Check if the training feedback is used to rate the trainer and use it effectively for future planning.

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2.IA.3 Planning and administration Control Objective To ensure appropriate cost of the Trainings.

Nature of Work Step Verification / Analysis Risk Difference in Planned Vs Actual Nature of Control Automated/ Manual

1. Verify the actual vs. budgeted amount sanctioned for the trainings. Use T-Code S_ALR_87011761.

2. Analyze the root cause for any significant variation in the budget Vs actual.

3. Check whether the expenses incurred by the department are in adherence to the documented company policy. Use T-Code MIR4, FBL3N.

4. Check on sample basis if the expenses are supported with adequate approvals and evidences. Use T-Code MIR4, FBL3N.

5. Analyze the root cause for excess fund utilization than sanction for trainings. 6. Check whether the succession planning has been done for Coaches.



1. Check whether status of work completion in measurement book is updated. Use T-code ME2S/MSRV1.







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3. Chemical – Internal Audit Scope

Audit Areas


2 Planning, preparation and maintenance of drilling fluid

3 Sampling and testing of mud/cement

4 Sampling and testing of chemicals

5 Environment, health and safety compliance

6 Creation and release of purchase requisition

7 Issuance of chemicals/spares items/storage

8 Equipment management and maintenance

9 Buy vis a vis hiring of chemicals/ equipments


11 Certification of bills of vendor


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3.IA.1 Planning, Budgeting & Monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,


1. Use T-Code KSBL to check whether the annual plan of chemical department is complete and all-inclusive to cover the requirements of equipment and manpower.

2. Check whether annual plan is timely prepared and approved by competent authority as per DOP. 3. Use T-Code KSBL (version management feature) to check whether any amendment in annual

plan is approved by competent authority as per DOP. 4. Use T-Code S_ALR_87013558 to check whether budget is made as per the annual plan and is

inclusive of all the related costs. 5. Check whether the budget is timely prepared and approved as per DOP. 6. Use T-Code S_ALR_87013558 to check whether all the supporting w.r.t budget approvals are

uploaded in SAP. 7. Check whether the budget is sufficiently adequate i.e. correct budgeting is being done. 8. Use T-code S_ALR_87013532 to obtain the overall budgeted and actual figures and use T-code

CJ31, CJ33 to obtain the project specific details. Check whether actual expenses are monitored / compared with planned expenses on periodic basis.

9. To check whether there is adequate monitoring and supervision of activities.

3. IA.2 Creation and release of purchase requisition Control Objective Timely procurement of chemicals/spares Nature of Work Step Verification / Analysis Risk 1. Raising of PRs without routing through SAP.

2. Non-reviewing of pending and open PRs in the SAP. Nature of Control Manual / Automated

1. Use T-code ME5A/ME53N to check whether PR is raised as per Purchase/Contract policy manual.

2. Use T-code ME53N to check whether the PR for spares/materials/jobs is raised timely. 3. To check whether proper specifications are mentioned while creating a PR. 4. To check whether approvals for PR, issue of spares/materials and conducting jobs is taken as per

DOP. 5. To conduct lead time analysis between PR initiation and its release. Ensure there is reasoning

analysis done for delays. 6. To check whether there is a process of reviewing pending PRs and its follow up process with

Contracts/Material Management. 7. To check whether all PRs are raised through SAP. 8. To verify month wise trend for consumption.

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3.IA.3 Buy vis a vis hiring of equipment's / Buying of chemicals Control Objective Exploring the best option available Nature of Work Step Verification / Analysis Risk 1. Inappropriate documentation.

2. No formal contract for chemicals. Nature of Control Manual / Automated

1. Use T-Code ME2N/ME2L/ME2M to check whether PO exists for chemicals. 2. To check whether adequate documentation exists w.r.t cost benefit analysis. 3. To check whether specifications exists for chemicals / equipment for floating tender and

competitive bidding. 4. To check whether cost benefit analysis is done for buying vis a vis hiring of equipment.

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4. Civil – Internal Audit

Scope Audit Areas


2 EHS Compliance


4 Survey (Fields and Projects)

5 Cost estimate

6 Design plan

7 Operations

8 Contracting of civil services

9 Field activities

10 Escalation

11 Issuance of equipment/spares items and storage


13 Buy vis a vis hiring of civil equipment or tools

14 Creation of Service Entry Sheets (SES)

15 Certification of RA bills of vendor

16 Complaints (Township)

17 Miscellaneous activities

18 PR tracking


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4. IA.1 Planning, Budgeting & Monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,


1. Use T-Code KSBL to check whether the annual plan of fields/township/projects section is complete and all-inclusive to cover the requirements of equipment and manpower. Review the process for financial closing in line with documented procedures.

2. Check whether annual plan is timely prepared and approved by competent authority as per DOP. 3. Check whether line plan preparation has been done adequately (letter from planning

department, formation of siting committee etc.). 4. Use T-Code KSBL to check whether any amendments in annual plan are approved by competent

authority as per DOP. 5. Use T-Code S_ALR_87013558 to check whether budget is made as per the annual plan and is

inclusive of all the related costs. 6. Check whether the budget is timely prepared and approved as per DOP. 7. Use T-Code S_ALR_87013558 to check whether all the supporting w.r.t budget approvals are

uploaded in SAP. 8. Check whether the budget is sufficiently adequate i.e. correct budgeting is being done. 9. Use T-code S_ALR_87013532 to obtain the overall budgeted and actual figures and use T-code


10. Check whether there is adequate monitoring and supervision of activities.

4. IA.2 EHS Compliance Control Objective Statutory Compliance Nature of Work Step Verification Risk 1. Non-compliance to statutory laws leading to legal hurdles. 2. Non- adherence to government rulings creating a risk on market reputation. Nature of Control Manual

1. Check whether all the environmental clearances, if applicable (forest land, tea garden land etc.) are applied for timely.

2. Check whether there is a follow up mechanism for internal/external approvals to ensure timeliness.

3. Check whether civil work is initiated only after the EC has been obtained. 4. Check whether statutory safety procedures are complied with at the site by conducting surprise

visit. 5. Check whether SOP procedures as per Company policy are complied by conducting surprise

checks. 6. Check whether there is a process of monitoring compliance to SOP and statutory safety and

environmental requirements. 7. Check whether there is exists a documented review for monitoring of EHS compliance and the

same is approved as per DOP. 8. Check whether there is statutory compliance by the contractors.

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4. IA.3 Creation and release of purchase requisition Control Objective Timely procurement of stores/spares

Nature of Work Step Analysis / Verification Risk 1. Inappropriate approvals. 2. Non-completion of PR raised in various aspects. 3. Inadequate monitoring of Open PRs. Nature of Control Automated/ Manual

1. Use T-code ME5A for list of PRs and ME53N for checking the details of PR. Check whether PR is raised as per Purchase/Contract policy manual.

2. Check whether PR is raised as per the estimations of the approved drawings/ adoption of approved schedule of rates (SOR).

3. Check whether inventory levels for stock items are monitored and intimation is sent timely to the Materials department for procurement.

4. Check whether the PR raised is aligned with the design/plan approved for the particular job. 5. Check whether the PR for spares/materials/jobs is raised timely. 6. Check whether approvals for PR, issue of spares/materials (MB23) and conducting jobs is taken

as per DOP. 7. Conduct lead time analysis between PR initiation and its release. Ensure there is reasoning

analysis done for delays. 8. Check whether there is a process of reviewing pending PRs and its follow up process with

Contracts/Material Management. 9. Check whether proper specifications are mentioned while creating a PR. 10. Check whether market rate analysis is conducted for items and is duly vetted by the competent

authority. 11. Check whether all PRs are raised through SAP. 12. Check whether PRs are raised within the budgetary limits allocated to the department and

approvals on PRs are obtained as per DOP. Use T-Code S_ALR_87013558 to view the budget. 13. Check whether there is a maker checker control for preparation and release of PR. 14. Check whether the survey of the land coordinates for prospective drilling area as defined by

G&R, in LAF-1, is carried out timely.

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4. IA.4 Cost Estimate Control Objective Appropriate cost of services, adequate approvals


Risk 1. Inappropriate approvals. 2. Incorrect cost estimate calculation.

Nature of Control Manual

1. Check whether estimate received by LAF 2 is released to LAF 3 and geology department for budget approval.

2. Check whether cost estimate is all-inclusive to cover the requirements of equipment and manpower and are aligned with the approved plan and designs.

3. Check whether approvals on cost estimates are obtained as per DOP. 4. Check whether actual expenses are monitored / compared with planned expenses on periodic

basis. 5. Check whether root cause analysis is performed in case of cost overrun and is approved as per

DOP. 6. Check whether the cost estimated is timely amended and approved as per DOP, in case of any

changes in the civil plan. 7. Check whether quotations are obtained and analyzed while doing cost estimation. 8. Check whether the design/plan for preparation of site is exhaustively prepared including all

timelines and details like composition of materials, specifications w.r.t area, width and height, foundation type, torsion reinforcement etc.

4. IA.5 Operations

Control Objective Effective execution of civil activities, adequate monitoring Nature of Work Step Verification/Analysis Risk 1. Inadequate monitoring.

2. Non effective execution of Civil Activities. Nature of Control Manual/ Automated

1. Use T-code ME5A for list of PRs and ME53N for checking the details of PR. Check whether requisition raised by the user department for initiation of civil work at identified location is raised timely.

2. Check whether the requisition raised by the user department is approved as per DOP. 3. Check whether all the requests for civil work are made through SAP. 4. Check whether there is a process of recording the manual/verbal requests received from

departments/residents. 5. Check whether the manual/verbal requests are completed as per the timelines mentioned in

the requisitions. 6. Check whether root cause analysis is performed for any delays w.r.t completion of work and

steps for improvement are initiated. 7. Check whether there is a process of monitoring the date of requisition as against date of

initiation of civil activity. 8. Check whether root cause analysis is performed for any delays in initiation of civil activities. 9. Check whether the execution of work is monitored regularly and any delay are reported to the

concerned authority. 10. Check whether timelines are monitored in carrying out each defined activities of civil plan. 11. Ensure that there is timely processing of PR. 12. Ensure that project completion monitoring is done. 13. Ensure that planning of work is done to avail fair weather conditions. 14. Check whether adequate quality control testing is done for civil jobs as defined in the contract.

Ensure testing and quality certificates are submitted along with SES.

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4. IA.6 Contracting of civil services Control Objective Quality of work, timely completion

Nature of Work Step Verification / Analysis Risk 1. Late completion of project.

2. Non-compliance to contractual/Statutory requirements. Nature of Control Automated / Manual

1. Use T-code ME5A for list of PRs and ME53N for checking the details of PR. Check whether purchase requisition for procurement of service is done post release of estimation from LAF 3.

2. Check whether the efficiency and quality of work carried out by the sub-contractor is timely monitored.

3. Ensure that there is timely availability of skilled workforce. 4. Check whether a progress report is prepared for the same and submitted to appropriate

authority. 5. Check whether permits to mobilize labor are timely available and any delays are substantiated

sufficiently. 6. Check that there is adherence to planned schedule. 7. Check whether the consumption of materials issued to contractors are monitored. 8. Check whether deductions are made from contractor’s payment in case of any breach of

compliances or wastage of material issued to him. Use T-Code FBL1N. 9. Check whether the compliance of statutory requirements as applicable on the contractor are

monitored periodically as defined in the contract. 10. Conduct a walkthrough of certification of Running Account (RA) bills of vendor. Use T-Code

FBL1N. 11. Check that allocation of work to contractors is without bias (Misc. civil contracts). 12. Ensure that there is compliance to contractual terms. 13. Ensure that awarding of contracts is routed through contracts department.

4. IA.7 Field Activities Control Objective Timelines

Nature of Work Step Verification Risk 1. Delay in preparation and handing over of site.

2. Delay in awarding and finalization of contracts. Nature of Control Manual

1. To ensure that there are no delays in preparation and handing over of site. 2. To ensure that there are no delays in processing tenders, awarding and finalization of contracts.

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4. IA.8 Escalation Control Objective Tracking of escalation clause, applying accounting principles

Nature of Work Step Analysis / Verification Risk 1. Non-adherence to escalation clause.

2. Non-adherence to applicable Generally accepted accounting principles (GAAPs).

Nature of Control Automated / Manual 1. Check whether the escalation in price of materials, in case on inclusive contracts is as per the

terms mentioned in the Contract and as per the defined procedures of the Contracts Manual. 2. Check whether escalation invoice is raised separately or a separate component in invoice is

created and the same is approved as per DOP. 3. Use T-code ME2S to check whether provisions on account of escalation clause is made in the

books of account and necessary amendment is carried out in the contract, duly approved as per DOP.

4. IA.9 Buy vis a vis hiring of civil equipment or tools Control Objective Exploiting the best option available Nature of Work Step Verification Risk Extra cost to the Company. Nature of Control Manual

1. Check whether cost benefit analysis is done for buying vis a vis hiring of equipment or tools.

4.IA.10 Certification of RA bills of vendor Control Objective Authorized payment, no duplicity payments Nature of Work Step Analysis / Verification Risk 1. Unauthorized payments.

2. Duplicate payments. Nature of Control Automated/Manual

1. Conduct a walkthrough of certification of Running Account bills of vendor. 2. Check whether vendor's RA invoices are paid only after proper supporting documents have been

verified and approval is taken as per DOP. Use T-Codes FBL1N to view vendor ledger. 3. Check whether deductions are made from contractor’s payment in case of material issuance for

inclusive contracts. 4. Check whether the certification of bills is correct. Ensure that there is no over payment/

duplicate payment/ unauthorized payment to the vendors. Use T-Codes FBL1N. 5. Check whether advance payment made to the vendor is adjusted while making payment of

invoice, if applicable. Use T-Codes FBL1N, MIR4. 6. Check whether payment is made only against liability created in SAP.

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4. IA.12 Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Analysis / Verification Risk 1. Over/Under-utilization of manpower.




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5. Contracts – Internal Audit

Scope Audit Areas

1 Purchase requisition and budget

2 Procurement

3 Cost estimate

4 Invitation for Bidding (IFB) in case of open bidding

5 Sale of bidding document

6 Pre-bid conference

7 Bidding process

8 Relaxation of standard terms and conditions

9 Open bidding

10 Limited bidding/ Single bidding

11 Receipt of bid

12 Opening of bid

13 Preliminary examination and comparison of bids

14 Evaluation of bids, preparation of Tender Committee Resolution (TCR) and award & signing of the contract

15 Commencement of work and issue of work order and monitoring of work

16 Liquidated damages

17 Retention money

18 Extension of contract period

19 Variation in contract

20 Extra / Substituted items

21 Escalation

22 Payment

23 Closure of contract

24 Performance appraisal

25 Bid security

26 Performance guarantee

27 Monitoring of lead times from PR to awarding of contract

28 PR tracking



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5.IA.1 Purchase requisition and budget Control Objective Budgetary monitoring, adequate information readily available for

procurement, accuracy in accounting, compliance to DOP. Nature of Work Step Analysis / Verification Risk 1. Inappropriate approvals.

2. Non compliance to DOP. Nature of Control Automated/Manual

1. Check whether the PR is raised as per the process mentioned in Contracts Manual. Use T-Code ME5A to view the list of PRs and use ME53N and enter the PR number to view the PR in SAP.

2. Check whether receipt of purchase requisitions from user departments is done through SAP, SRM & Hard Copy. The relevant T-code in SAP- ME53N, ME5A.

3. Check whether requisite approvals (BEC/BRC approval) are obtained. The relevant T-code in SAP- ME53N, ME5A.

4. Use T-Code S_ALR_87013558 to see the sanctioned budget and check whether PRs are raised within the budgetary limits allocated to the department and approvals on PRs are obtained as per DOP. The relevant T-code in SAP- ME53N, ME5A.

5. Check whether PR is accompanied with minimum details as required by Contract Manual such as detailed of scope, amount of approved estimated cost, budget provisions & management approvals, detailed technical specifications, Schedule of quantities, the approved BRC/BEC. The relevant T-code in SAP- ME53N, ME5A.

6. Check whether nature (revenue or capital or special revenue), date by which the award of contract is required and time for completion of work are specified in the PR. The relevant T-code in SAP- ME53N, ME5A.

7. If invitation of bid is to be done on limited bid/single bid/proprietary single bid /emergency bid basis, Check PR is approved accordingly as per defined DOP. The relevant T-code in SAP- ME53N, ME5A.

8. Check whether PRs raised are completed in order to avoid delays due to incompleteness / incorrectness of PR. The relevant T-code in SAP- ME53N, ME5A.

9. Check whether there is a maker checker control for preparation and release of PR. The relevant T-code in SAP- ME53N, ME5A.

10. Check whether pending purchase requests are reviewed and necessary actions/follow ups are done internally or externally. The relevant T-code in SAP- ME53N, ME5A.

11. Use T-Code S_ALR_87013558 Check whether technical/budget sanction is as per the Contract Manual and approved as per the defined DOP.

5.IA.2.1 Procurement Control Objective Procurement in done as per Purchase and Contracts Manual Nature of Work Step Verification Risk 1. Unauthorized procurement.

2. Delays in procurement. Nature of Control Manual / Automated

1. Check whether procurement is within the defined budgetary limits. Use T-Code ME2N to view the list of Contract/Work Orders and use T-Code ME33K,ME23N, and enter the Contract/Work Order Number to view the sample Contract/Work Order. Ensure that Contract/Work Order raised have a PR against it and are approved as per DOP.

2. Ensure that there is no unauthorized procurement due to processing of unapproved Contract/Work Order. The relevant T-code in SAP- ME2N, ME33K, ME2S.

3. Ensure that there is a process of monitoring of emergency Contract/Work Order's. The relevant T-code in SAP- ME2N, ME33K, ME2S.

4. Ensure that procurement of materials/ services is routed through contracting department. Use T-

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Code ME5A to view the list of PRs and check whether they are routed correctly. Use T-Code ME2S Check the services received against Contract/Work Order.

5. Ensure that there is no delay in contracting of urgent requirements. The relevant T-code in SAP- ME23N, ME2N.

6. Check whether there is delay in procurement due to processing of incomplete/unapproved indents. The relevant T-code in SAP- ME5A, ME23N.

5.IA.2.2 Procurement Control Objective Materials / services are not procured on piece-meal basis to avoid a tendering

process. Nature of Work Step Verification Risk 1.Finalization of order on uncompetitive terms & conditions.

2. Unauthorized procurement of material / services. Nature of Control Manual

1. Obtain list of purchase orders / service orders released during the review period. ME2N/ME3N. 2. Analyze and check if there is repetitive procurement of any material / service with a short span

of time. 3. Obtain the reason for not clubbing the requirements to achieve economy of scale.

5.IA.2.3 Procurement Control Objective Any work order/contract is not awarded to any black listed vendor


Risk 1. Finalization of order on uncompetitive terms & conditions. 2. Delay in procurement of material / services which may result in disruption of operations. 3. Procurement of material / services which do not match the requirement.

Nature of Control Automated / Manual 1. Obtain the list of black listed vendors. Use SAP T-Code SE16N (LFA1 Table) to get list of vendors

for posting block and purchasing block. 2. Generate a report ME2N,ME3N, ME33K for the period giving list of work orders / contract

awarded during the review period. 3. Analyze these reports to verify if any work orders / contract is given to any blacklisted vendor,

after the date of blacklisting.

5.IA.2.4 Procurement Control Objective Adequate taxes have been paid on the procurement of goods / services Nature of Work Step Verification Risk Statutory non compliance leading to penal consequences. Nature of Control Automated / Manual

1. Use Transaction ME2N /ME3N to see the list of work orders/contracts. 2. Check the work orders/contracts for correct taxes as per the applicable rates. 3. Check if any taxes have been put in line items of the contract/work order. Report deviations if

any. 4. Obtain the reason for exceptions and report the same.

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5.IA.3 Cost Estimate Control Objective Appropriate cost of services, adequate approvals Nature of Work Step Verification Risk Inadequate approvals. Nature of Control Manual

1. Check whether cost estimate is prepared by the user department before raising a PR. Use T-Code KSBL to view the cost estimate if maintained in SAP.

2. Check whether approvals on cost estimates are obtained as per DOP. The relevant T-code in SAP- KSBL.

3. Check whether cost estimate prepared by user department is vetted by Vetting Committee or by the concerned L-4 officer as required by Contract Manual. The relevant T-code in SAP- KSBL.

5.IA.4 Invitation for Bidding (IFB) in case of open bidding

Control Objective Competitive bidding, completeness of tender document, safeguarding interest of the Company.

Nature of Work Step Verification Risk 1. Unfair bidding process.

2. Legal Implication. Nature of Control Manual

1. Check whether invitation for bidding is floated in local/state/national newspapers as per nature and value of the contract defined in Contract Manual.

2. To ensure the issue of NIT in Press / Float Limited Tender / E-Tender. 3. Check whether copies of newspaper are documented in contract file. 4. Use T-Code ME43/ME4L (By vendor)/ME4M (By material) /ME4S (By Tender number) to check

whether completeness of the tender document inviting bids (whichever applicable) is ensured in terms of its content e.g. serial numbering of tender documents, BEC/BRC criteria, standard terms and conditions, brief description of the requirement, bid sale closing date, date for pre-bid conference, IFB No. and date, the cost of the bid document, hosted website security amount to be paid etc. as mentioned in the Contracts Manual.

5. Check whether for open bidding, advertisement is published on OIL notice board, vernacular daily or national daily as per the value of the contract as mentioned in the Contracts Manual.

5.IA.5 Sale of bidding document Control Objective Accuracy in amount received through sale of bid document Nature of Work Step Verification Risk Inadequate process of collection of money raised through bid document. Nature of Control Automated / Manual

1. Check whether a bid document fee is charged for the sale of bid documents as per the Contracts Manual.

2. Verify that the sale of bid document is recorded in the bid register along with their address, cheque number and whether the bidder is a Government Department or registered with NSIC. The SAP T/Codes for checking tender fee amount and tender received is ZMMTENFEE3 / ZMMTENDER3.

3. Check whether appropriate supporting are taken from the bidders exempted from paying the bid document fee i.e. Government Department or registered with NSIC.

4. Check whether the total amount collected from sale is reconciled with the total number of bid documents sold.

5. Verify that the proper accounting of the tenders sold and unsold is done. Use T-Code FBL3N and enter the GL where the tender sale amount is booked. Check whether the amount booked is

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reconciled with the number of bid documents sold. 6. Verify that no sale of bid document is done after last day of tendering. 7. Check whether there is a process of monitoring the collections made through sale of bid

document w.r.t the bid documents sold. 8. Check whether reconciliation between money collected and total number of bid documents

sold is done.

5.IA.6 Bidding Process Control Objective Competitive bidding, compliance to contract manual Nature of Work Step Verification Risk 1. Non-compliance to Purchase manual.

2. Inappropriate approvals. Nature of Control Manual

1. Check whether two part-bid system (Un-priced Technical Bid and Price Bid separately) is used as required in Contract manual (for all the works/services costing more than Rs. 100 Lakhs / as mentioned in Contracts Manual or any addendums).

2. Check whether in the two bid system, the price envelope is opened only after opening of technical bid and opening of price bid is approved as per DOP.

3. Check whether only the bids that have been quoted within the time period as specified in the bid document are considered as valid.

5.IA.7 Open bidding Control Objective Timely bidding, allowing eligible vendors for bidding, time bound bidding Nature of Work Step Verification Risk 1. Delay in contract finalization leading to operational delays.

2. Finalizing order on non-competitive terms. Nature of Control Automated / Manual

1. Check whether open bidding is done as per the guideline in the Contract Manual. 2. Check whether adequate vendor selection has been done in compliance to procurement

policies and procedures (incl. tendering). Ensure that quotations are received from at least 2 vendors or more as per Contracts Manual. For a single quotation, ensure that proper policy guideline like bid extension etc. mentioned in Contracts Manual is followed.

3. Check for delay from the date of PR release, with the date of manual tender / e-tender and reasons are recorded for delay. The relevant T-code in SAP- ME53N, ME5A.

4. Check whether the bidders are allowed to bid on SRM server only after receipt of tender fee, if applicable.

5. Check whether the bidding process is open only till the time period mentioned as per the Contracts Manual.

6. Other relevant T-codes are ZMMTENDER3, ME43, ME4L and ME4M.

5.IA.8 Limited Bidding / Single Bidding Control Objective Compliance to DOP, availing emergency services, time bound bidding Nature of Work Step Verification Risk Non adherence to purchase manual Nature of Control Automated/Manual IA / TA IA

1. Check whether there is a process to maintain a database with details of all the contracts made through single tender contract and reasons are provided for the same.

2. Check whether approvals are obtained as per DOP for entering into the selected method of bidding.

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3. Check whether for single bid, either the certificate for emergency approved by DOP or the proprietary certificate is present.

4. Check whether the bidding process is open only till the time period mentioned as per the Contracts Manual.

5. Check whether the emergency services are regularized timely and as per the process mentioned in Contracts Manual. The relevant T-code in SAP- ME23N, ME2S, ME33K.

5.IA.9.1 Receipt of Bid Control Objective Segregation of duties, Bids in lock in key Nature of Work Step Verification Risk Insecurity of bids. Nature of Control Manual

1. Check whether the bids are deposited by the bidders in the Tender Box kept at the designated office of OIL, or handing them over to the officer in charge of receiving the bids in case the numbers of bids are voluminous.

2. Check whether tender box is always kept locked by two locks and key of one lock is under custody of Head-Contracts and key of other lock is with the designated officer of F&A department.

3. Check whether bids received by ordinary/Regd. Post/personally are handed over to receiving Section and recorded in a register maintained at receiving section.

4. Check whether E-mail / fax / telex / telegraphic/telephonic bids are accepted in cases other than OEM/Proprietary cases on single bidding. (The steps will have to be modified as per the nature of tender.)

5.IA.9.2 Receipt of bids Control Objective Segregation of duties, Bids in lock in key Nature of Work Step Verification Risk Insecurity of bids. Nature of Control Manual E-tender (for tenders above 25 lakhs or the limit defined / revised time to time)

1. Check whether access rights to e-tender portal are given to bidder only on receipt of tender fees (whether online payment or DD payment). Check whether tender fees details are recorded in a register. In e-tender portal, tender can be searched using SAP tender no. in strategic sourcing in e-portal.

2. Check only authorized personnel of contract department have access to allot access rights to e-tender portal.

3. Check whether any bids have been submitted after the last date of bid submission. 4. Ensure that bids cannot be opened before the designated dates. User ids and password of two

personnel (example- one person from contract department and another from finance) should be required for opening the bid.

5. Check availability of log for activities performed in the portal.

5.IA.10 Opening of bid Control Objective Tracking of bid documents Nature of Work Step Verification Risk Inadequate documentation. Nature of Control Manual

1. Check whether the attendees presented at the time of opening the bids are only bidders / authorized representative of bidders and their signature is taken against the bidder's name in a proper format as per contract manual.

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2. Check whether the bids received are serially numbered and envelops are preserved. 3. Check whether the officers present at the time of opening of Bid have signed against the name

of firms whose bid has been received. 4. Check whether Certificate of compliance and bid security are furnished by the bidders.

5.IA.11 Preliminary examination and comparison of bids Control Objective Implementation of maker checker control Nature of Work Step Analysis / Verification Risk Non-implementation of maker checker control.

Nature of Control Automated / Manual 1. Check whether the particulars of the bids are recorded in a bid opening register. 2. Check whether both the technical and commercial evaluations reports submitted by Indenting

and Contract department respectively, are vetted by Finance. The relevant T-code in SAP- ME49, ZMMTCRENTRY3, ZMMTCR & ZMMME49.

3. To ensure that the cost of procurement is controlled due to effective negotiation/ accurate comparison of commercial bid submitted.

4. Check whether final evaluation report is prepared by bid evaluation committee.

5.IA.12 Evaluation of bids, preparation of Tender Committee Resolution (TCR) and award &

signing of the contract Control Objective Selection of competent contractor Nature of Work Step Verification Risk Non-adherence to the set process.

Nature of Control Manual 1. Check whether the bid evaluation committee has completed the evaluation of the bids as per

evaluation criteria, technical and commercial evaluation reports, BEC/BRC including bidder’s qualification requirements and cost compensating the deviations taken by the bidders with proper data support.

2. Check whether evaluation report of the bid evaluation committee is placed before the competent authority within the defined date as per Contracts Manual.

3. Check whether completeness of the award proposal prepared as per the terms mentioned in the Contracts Manual.

4. Check whether the same is approved and communicated to the bid winner within the bid validity period. The relevant T-code in SAP- ME23N, ME33K. For further analysis, one can use T-Code ME2L to view all the contracts with a specific vendor.

5. Ensure that appropriate commercial terms are agreed in the contract, which are in the best interest of OIL. The relevant T-code in SAP- ME23N, ME2L, ME33K.

6. Ensure that ratification of the contract is done by the legal department. 7. Check whether the detailed contract is signed within defined date as per Contracts Manual. The

relevant T-code in SAP- ME23N, ME2L, ME33K.

5.IA.13 Liquidated Damages Control Objective Safeguard interest of the Company Nature of Work Step Verification Risk Non-compliance to DOP. Nature of Control Automated / Manual

1. Check whether LD (liquated damage) has been charged as per the contract terms. The relevant T-code in SAP- ME23N, ME2S, ME33K.

2. Use T-Code FBL1N to see vendor ledger for which details are required. Thereafter, filter the lines relevant for analysis.

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3. In case LD was not levied, check for necessary approvals.

5.IA.14 Retention Money Control Objective Safeguard interest of the Company Nature of Work Step Verification Risk Non-compliance to DOP. Nature of Control Automated / Manual

1. Check whether the retention money is retained / released as per terms of the Contract. The relevant T-code in SAP- FBL1N, ME33K.

2. Check whether adequate approvals are obtained as per DOP before release of retention money.

5.IA.15 Extension of contract period Control Objective Recording of justification in case of extension and approval as per DOP Nature of Work Step Verification Risk 1. Inadequate justification.

2. Non-compliance to DOP. Nature of Control Automated / Manual

1. Check whether the extension of the contract period and waiver of liquidated damage are approved as per DOP. The relevant T-code in SAP- ME23N, ME2S,ME33K.

2. Check whether reasons for extension of contract period are recorded and any further actions are taken as required.

3. Check whether in case any Approving committee finds it necessary to revise its own earlier decision of imposing liquidated damages and to waive recovery thereof, ensure approval of the next higher authority is obtained as per DOP.

5.IA.16 Variation Control Objective Appropriate payment on account of variations Nature of Work Step Analysis / Verification Risk Inappropriate payments. Nature of Control Automated / Manual

1. Check whether variation of the stipulated quantities of individual items in the contract is approved by Competent Authority preferably before allowing such variation but in exceptional case within a period not later than the time specified in Contracts Manual. The relevant T-code in SAP- ME23N, ME33K.2. Check whether the rates payable in respect of individual items in the contract are as per the contract rates/OIL Schedule of rates (SOR). The relevant T-code in SAP- ME23N, ME33K, FBL1N. Use T-Code MIR4 to view logistics vendor invoice.

5.IA.17 Escalation Control Objective Tracking of escalation clause, Applying accounting principles Nature of Work Step Analysis / Verification Risk 1. Non-compliance to escalation clause.

2. Non-compliance to Generally accepted accounting principles (GAAP). Nature of Control Automated / Manual

1. Check whether the escalation is as per the terms mentioned in the Contract and as per the defined procedures of the Contracts Manual. The relevant T-code in SAP- ME23N, ME33K, FBL1N, MIR4.

2. Check whether escalation invoice is raised separately or a separate component in invoice is created and the same is approved as per DOP. The relevant T-code in SAP- ME23N, ME33K, FBL1N, MIR4.

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3. Check whether provisions on account of escalation clause are made in the books of account. The relevant T-code in SAP- FBL3N.

5.IA.18 Payment Control Objective Accuracy in payment, avoiding any duplicate payment Nature of Work Step Analysis / Verification Risk 1. Duplicity of payments.

2. Inaccurate payments. Nature of Control Automated / Manual

1. Check whether the payment is made as per the payment terms mentioned in the Contract and approved as per DOP. The relevant T-code in SAP- FBL1N.

2. Check whether the Contractor submits invoice(s) as per the contract, with all required supporting documents and details of the said work. The relevant T-code in SAP- ME23N, ME33K, FBL1N, MIR4.

3. Check whether the user department takes approval for the invoice as per DOP within 15 days of receipt of invoice. In case of any discrepancies, user department must inform the contractor within 15 days else the invoice is considered fit for payment processing. The relevant T-code in SAP- ME23N, ME33K, FBL1N, MIR4.

4. Check whether payment of invoice within 30 days of its receipt is released after deducting statutory taxes/liquidated damages, etc. The relevant T-code in SAP- FBL1N.

5. Check whether the payment is made only against SAP liability created. The relevant T-code in SAP- FBL1N.

6. Check whether accurate reporting/ processing of information w.r.t to tender fee, bid security, PBG is done. The relevant T-code in SAP- FBL1N, MIR4, ME23N,ME33K, ZMMTENFEE3.

7. Check whether the payment is remitted to the Contractor's bank account and the details of the same are communicated to the Contractor.

5.IA.19 Closure of contract Control Objective Full and final settlement before closure of contract Nature of Work Step Verification Risk Closure before full & final settlement. Nature of Control Automated / Manual

1. Check whether before closing of a Contract the following has been ensured: a. Satisfactory completion of the work. b. Payment reconciliation, Stores reconciliation, No dues/claims certificate from the Heads of Department concerned and payment of final bill for the work. c. Satisfactory completion of defects liability period, return of Security Deposit/Retention Money/ performance Security. The relevant T-code in SAP- ME3N, ME33K, ME23N, MB5S, FBL1N, ML84.

5.IA.20 Bid Security Control Objective Assuring collection or return of bid security as per Contract Manual Nature of Work Step Verification Risk Non compliance to Contract Manual. Nature of Control Automated / Manual

1. Check whether Bid security is obtained as specified in the bid document. The relevant T-code in SAP- FBL1N, FBL3N & ZMMTENDER3, AMM_TEND2PR

2. Check whether reconciliation is done between the bid documents sold with the amount received for sale. The relevant T-code in SAP- FBL5N, FBL3N.

3. Check whether bid security is only received in the form bank guarantee, bank draft or banker's

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cheque. The relevant T-code in SAP- FBL1N, FBL3N. 4. Check whether exemption of bid security has been made in compliance to the Contract Manual. 5. Check whether bid security is returned to the bid winner only after performance security has

been received. The relevant T-code in SAP- FBL1N, FBL3N.

5.IA.21 Performance guarantee Control Objective Assuring collection or return of performance guarantee as per Contract

Manual Nature of Work Step Verification Risk Non compliance to Contract Manual. Nature of Control Automated / Manual

1. Check whether the performance bank guarantee is collected timely from the bidder as per the Contract & validity is as per the contract. The relevant T-code in SAP- FBL1N, FBL3N.

2. Check whether the performance guarantee is returned only after NOC is received from the user department and warranty obligations have been fulfilled. The relevant T-code in SAP- FBL1N, FBL3N, ME33K.

3. Check whether in case of invocation of performance security, proper reasoning is done and approval is taken as per DOP.

4. To ensure that non performance due to non receipt of required bid/performance guarantees has not occurred. The relevant T-code in SAP- FBL1N, FBL3N, ME33K.

5. Check whether performance security is not returned if order for invocation is passed. The relevant T-code in SAP- FBL1N, FBL3N.

6. Check that where contract validity has been extended, validity of the PBG has been accordingly extended or not.

5.IA.22 Monitoring of lead times from PR to awarding of contract Control Objective Timely award of contracts Nature of Work Step Analysis / Verification Risk Delays in finalizing contracts. Nature of Control Automated / Manual

1. Check whether the time taken in converting PR to Contract for each stage is being monitored by Contracts Department.

2. Analyze the lead time taken for each stage from PR to contract and report the cases of exceptional delays.







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5.IA.24 Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Analysis / Verification Risk 1. Over/Under Utilization of manpower.




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6. Crisis Management Team – Internal Audit

Scope Audit Areas

1 Planning

2 Budgeting

3 Incident recording

4 Acquisition of assets

5 Operations

6 PR tracking


8 Manpower planning

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6.IA.1 Planning Control Objective Adequate planning, Effective monitoring over plan, Compliance to DOP Nature of Work Step Analysis / Verification Risk Inadequate planning. Nature of Control Automated/Manual

1. Check whether the crisis management plan, incident management plan and blowout management plan is complete.

2. Check whether such plan is approved by competent authority as per DOP KSBL. 3. Check whether any amendments in such plan are approved by competent authority as per DOP. 4. Check whether actual expenses are monitored / compared with planned expenses on periodic

basis against such plan. The T-code reference for reports/verification is S_ALR_87013532.

6.IA.2 Budgeting Control Objective Adequate budget planning, effective monitoring over expenses, compliance

to DOP Nature of Work Step Verification / Analysis Risk Inadequate budget planning.

Nature of Control Automated / Manual 1. Check whether the annual budget is complete and all-inclusive Cover the requirements of

equipment and infrastructure. 2. Check whether annual budget is approved by competent authority as per DOP. The T-code

reference for reports/verification is CJ31, CJ33, S_ALR_87013558. 3. Check whether any amendments in annual budget are approved by competent authority as per

DOP. The T-code reference for reports/verification is CJ31, CJ33, S_ALR_87013558. 4. Check whether actual expenses are monitored / compared with planned budget on periodic

basis. The T-code reference for reports/verification is S_ALR_87013532.

6.IA.3 Incident recording Control Objective Crisis identification

Nature of Work Step Verification Risk Non identification of crisis. Nature of Control Manual

1. Check how many incidents have been termed as 'Crisis'. 2. Check whether the meeting is called by Resident Chief Executive (RCE) in case a situation is

identified to be out of control by operation in charge. 3. Check whether authority lies with RCE to declare the situation as crisis.

6.IA.4 Acquisition of assets Control Objective Purchase of equipment, timeliness, manpower


Risk Assets are not acquired as per the requirement. Nature of Control Manual / Automated

1. Check whether equipment have been acquired for the purpose of crisis management. The T-code reference for reports/verification is IH08.

2. Check whether there is adequate equipment and manpower to handle crisis situation.

3. Check that equipment have been acquired post requisite approvals.

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6.IA.5 Operations Control Objective Effective implementation of activities Nature of Work Step Verification Risk Ineffective implementation of activities. Nature of Control Manual

1. Check whether timeliness is observed while arranging equipment from outer agency like ONGC. 2. Check support from external sources (e.g. ONGC etc.) is received on time. 3. Check whether readiness testing has been done for the CMT scenario. 4. Check the frequency of visit of CMT team at site. 5. Check whether there is timely response to crisis.
















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7. Drilling

Scope Audit Areas


2 Inter-location movement

3 Drilling operations

4 Creation and release of purchase requisition (PR)

5 Issuance of materials/spares items



8 Buy vis a vis hiring of well equipment/rigs


10 PR tracking



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7.IA.1.1 Planning, Budgeting & Monitoring Control Objective Adequate planning, Effective monitoring over annual plan, Compliance to DOP Nature of Work Step Analysis / Verification Risk 1. Inadequate planning and budgeting.

2. Inappropriate approvals. 3. Over expenditure and utilization.

Nature of Control Automated/Manual 1. Use T-Code KSBL to run the cost center planning report and create a planning overview for all the

cost centers. 2. Check whether the annual plan of drilling department is complete and all-inclusive to cover the

requirements of equipment, manpower etc. 3. Ensure that there is alignment of the drilling plan with the overall work program. 4. Check whether annual plan is approved by competent authority as per DOP. 5. Check whether any amendment in annual plan is approved by competent authority as per DOP. 6. Check whether there are frequent changes in testing plan by production department leading to

ineffective rig time utilization. 7. Ensure that appropriate inputs are received for cost allocation process and well cost

reconciliation process. 8. Use T-code S_ALR_87013558 for budgeted figures and Check that there is planning and

monitoring of cost & effort involved in drilling of wells (recording and monitoring against standards in SOP).

9. Use T-code S_ALR_87013532 to obtain the overall budgeted and actual figures and use T-code CJ31, CJ33 to obtain the project specific details. Check whether actual expenses are monitored / compared with planned expenses on periodic basis.

10. Check whether adequate manpower planning is done and request is sent to HR. 11. Check whether timely follow-up is done with HR for ensuring availability of required manpower.

7.IA.1.2 Planning, Budgeting & Monitoring Control Objective To ensure that a 5 year, annual and TDP (tentative) drilling plan is prepared in

advance. Nature of Work Step Verification Risk Long term plan preparation in absence of adequate approvals.

Nature of Control Manual 1. Obtain the 5 year plan for field and projects. 2. To validate that the following have been approved and considered by the concerned process

owners prior to finalization of the 5 year plan:- a. Fixed Development plan for the next 5 years b. Approved feasibility reports c. Expected feasibility reports in the next 5 years.

3. Verify that the planned v/s actual are being tracked. 4. Report deviations if any.

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7.IA.1.3 Planning, Budgeting & Monitoring Control Objective To verify the presence of an approved drilling plan

Nature of Work Step Verification Risk Absence of comprehensive drilling plan which may impact planned

operations. Nature of Control Manual

1. Obtain and review the 5 year plan. 2. Verify if adequate drilling resource planning and requirement is being done in line with the 5

year plan in advance. 3. Obtain and review the annual drilling plan for the field and projects. 4. Verify that adequate approvals are in place prior to finalization of the annual drilling plan. 5. Review the approved criteria for prioritizing the wells. 6. Verify that the wells shortlisted in the approved annual drilling plan are high priority wells.

7.IA.1.4 Planning, Budgeting & Monitoring Control Objective To verify the adherence of drilling plan. Nature of Work Step Analysis / Verification Risk Lack of planned v/s actual tracking and root cause analysis leading to delay in

production and loss of revenue. Nature of Control Manual / Automated

1. Obtain the annual drilling plan. 2. Verify whether the tracking of planned v/s actual drilling is being done.

a. Check Drilling Activity (Plan vs. Actual) for Fiscal Year, OR 3. b. Wells completed till date during the fiscal year. 4. Review approvals for deviations if any.

5. Verify that a root cause analysis is conducted and approved.

6. Review the action taken post root cause analysis and validate that adequate changes have been made to the plan.

7.IA.1.5 Planning, Budgeting & Monitoring Control Objective To verify if the Well Completion Report is duly approved and the same is

prepared as per guidelines Nature of Work Step Verification Risk Well completion report prepared in the absence of adequate approvals and

guidelines. Nature of Control Manual

1. Obtain a sample of WCRs for different wells and verify if the WCRs are approved by the concerned departmental heads and prepared as per approved guidelines.

7.IA.1.6 Planning, Budgeting & Monitoring Control Objective To verify that a process of cost benefit analysis is carried out before hiring of

rigs Nature of Work Step Verification Risk Risk of financial loss and non-achievement of targets. Nature of Control Manual

1. Obtain the list of Chartered hired rigs. 2. Understand the process of rig chartering. 3. Verify that chartering of rig is supported by detailed cost benefit analysis considering all

prospective costs that will be incurred.

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4. Ensure that a detailed comparative has been done do justify chartered hiring of rigs. 5. Verify that the sanctioning for charter hiring of rigs has been obtained as per DOP.

7.IA.1.7 Planning, Budgeting & Monitoring Control Objective To verify that the rig hiring contracts are complete in terms of various

specifications and terms & conditions as required by rigs in order to perform required operations.

Nature of Work Step Verification Risk Risk of dispute and non-performance by supplier. Nature of Control Manual

1. Refer to signed hard copy of rig contracts.Refer to signed hard copy of rig contracts. 2. Check that the contracts are complete and include the following aspects:

a. Bid evaluation criterion. b. Facilities to be provided either free of cost or on chargeable basis. c. Optimum mix of manpower. d. Type of rig required. e. Optimum selection of scheduled rates of payment (either meterage or rig day basis).

7.IA.1.8 Planning, Budgeting & Monitoring Control Objective To verify whether a constant monitoring and evaluation is carried out for the

outsourced rigs. Nature of Work Step Verification Risk Non performance of chartered hired rigs leading to higher costs. Nature of Control Manual

1. Obtain the contract documents for chartered hired rigs. 2. Check if the performance of the external contractor is being measured in line with the agreed

benchmarks set for them. 3. Document and report on the inefficiencies in the operations/ services, if any and check whether

such inefficiencies are adjusted in subsequent payments through keeping proper record of the operations.

7.IA.2 Creation and release of purchase requisition (PR) Control Objective Timely procurement of stores/spares. Nature of Work Step Analysis / Verification Risk 1. Delay in procurement.

2. Unauthorized request for procurement. Nature of Control Automated / Manual

1. Use T-code ME5A for list of PRs and ME53N for checking the details of PR. Check whether PR is raised as per Purchase/Contract policy manual.

2. Check whether the PR for spares/materials/jobs is raised timely. 3. Check whether approvals for PR, issue of spares/materials and conducting jobs is taken as per

DOP. 4. Conduct lead time analysis between PR initiation and its release. Ensure there is reasoning

analysis done for delays. 5. Check whether there is a process of reviewing pending PRs and its follow up process with

Contracts/Material Management. 6. Check whether proper specifications are mentioned while creating a PR. 7. Check whether all PRs are raised through SAP.

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7.IA.3 Buy vis a vis hiring of well equipment/Rigs Control Objective Exploiting the best option available Nature of Work Step Analysis / Verification Risk Financial loss. Nature of Control Automated / Manual

1. Use T-code KSBL for running the cost center planning report and create a planning overview for all the cost centers.

2. Check whether cost benefit analysis is done for buying vis a vis hiring of equipment / rigs. 3. Check whether laid down procedures are followed while hiring of equipment/rigs. 4. Use T-code IE03,IK07, IK17 for displaying equipment and equipment status, list of measure

points and corresponding measuring documents searching by maintenance plant respectively. Check whether constant monitoring and evaluation is carried out for the outsourced equipment/Rigs.

5. Ensure that there is compliance of the terms of the contract with the rig leasing company. 6. Use T-code ML84 for obtaining the list of service entry sheets. Check whether terms and

conditions agreed in contract are followed by the contractors while execution of drilling activities.







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7a. Technical Services (Drilling) – Internal Audit

Scope Audit Areas


2 TS drilling operations





7 Buy vis a vis hiring of servicing equipment


9 PR tracking



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7a.IA.1 Planning, Budgeting & Monitoring Control Objective Adequate planning, Effective monitoring over annual plan, Compliance to DOP Nature of Work Step Analysis / Verification Risk Inadequate planning and monitoring. Nature of Control Automated/Manual

1. Check whether the annual budget of TS drilling department is complete and all-inclusive to cover the requirements of equipment, manpower etc. Use T-codes KSBL.

2. Check whether annual budget is approved by competent authority as per DOP. Use SAP T-code KSBL.

3. Check whether any amendment in annual budget is approved by competent authority as per DOP. Use T-code KSBL.

4. Check whether actual expenses are monitored / compared with planned expenses on periodic basis. Use T-code KSBL.

7a.IA.2 Creation and release of purchase requisition (PR) Control Objective Timely procurement of stores/spares

Nature of Work Step Verification / Analysis Risk Delay in procurement of stores and spares. Nature of Control Automated/ Manual

1. Check whether PR is raised as per Purchase/Contract policy manual. SAP T-codes ME5A to obtain the list of PR generated, ME53N to see the specific sample PR and ME5J to view PRs for projects.

2. Check whether the PR for spares/materials/jobs is raised timely. SAP T-codes ME5A, ME53N, ME5J.

3. Check whether approvals for PR, issue of spares/materials and conducting jobs is taken as per DOP. SAP T-codes ME5A, ME53N, ME5J to be used.

4. To conduct lead time analysis between PR initiation and its release. Ensure there is reasoning analysis done for delays. T-codes ME5A, ME53N, ME5J.

5. Check whether there is a process of reviewing pending PRs and its follow up process with Contracts/Material Management. Use T-codes ME5A, ME53N, ME5J.

6. Check whether proper specifications are mentioned while creating a PR. Use T-codes ME5A, ME53N, ME5J.

7. Check whether all PRs are raised through SAP. Use T-codes ME5A, ME53N, ME5J.

7a.IA.3Buy vis a vis hiring of servicing equipment Control Objective Exploiting the best option available Nature of Work Step Verification/Analysis Risk Inefficient Monitoring and utilization of Equipment. Nature of Control Manual/ Automated

1. Check whether cost benefit analysis is done for buying vis a vis hiring of servicing equipment. Use T-codes KSBL.

2. Check whether laid down procedures are followed while hiring of servicing equipment. Use T-codes IW33, IW39.

3. Check whether constant monitoring and evaluation is carried out for the outsourced servicing equipment. Use T-codes IW39 and IW73.

4. Check whether terms and conditions agreed in contract are followed by the contractors while execution of servicing of drilling/work over equipment. Use SAP T-codes ME5A, ME53N.

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7a.IA.4 PR Tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Analysis / Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /








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8. Electrical – Internal Audit

Scope Audit Areas


2 Statutory compliances

3 PR tracking


5 Manpower planning


7 Distribution

8 Operations

9 Maintenance

10 SOP compliance

11 Services - Operations

12 Safety

13 Training to workers

14 Security


16 Tools, spares and other expenses

17 HSE compliances

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8.IA.1 P&A - Planning, budgeting & monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,

compliance to DOP Nature of Work Step Analysis / Verification Risk 1. Inappropriate approvals.

2. Delays in preparation of budget. Nature of Control Automated/Manual

1. Check whether the annual plan of electrical department is complete and all-inclusive to cover the requirements of all the activities that come under its purview.



6. Check the timelines for preparation and approval of budget. 7. Use T-Code S_ALR_87013532 by entering WBS element / cost center to check whether actual

expenses are monitored / compared with planned expenses on periodic basis.

8.IA.2 P&A - Statutory Compliances Control Objective To ensure compliance to various statutory requirements Nature of Work Step Verification Risk Non Compliance to various Statutory requirements. Nature of Control Manual

1. Check that a checklist is maintained for all statutory compliances along with the due dates of complying the same.

2. Check that license related to power has been obtained and updated regularly. 3. Check that statutory compliance checklist is analyzed and updated regularly. 4. Check whether all the statutory compliances are ensured by the department.

8.IA.3 P&A - PR tracking Control Objective Timely raising of PR and monitoring

Nature of Work Step Analysis / Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /

operational delays. Nature of Control Manual/ Automated

1. Use T-Codes ME53N and ME5A to check whether PRs for spares/materials/jobs are raised timely. 2. Check whether approvals for PRs, issue of spares/materials and conducting jobs are taken as per

DOP. 3. Conduct lead time analysis between PR initiation and release. Ensure that reasoning analysis is

conducted for delays. 4. Check whether there is a process of reviewing pending PRs and whether a follow-up process with

Contracts/Material Management exists.

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8.IA.4 P&A - Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities. Nature of Work Step Analysis / Verification Risk 1. Over/Under Utilization of manpower.




8.IA.5 Distribution - Statutory compliances Control Objective To ensure compliance to various statutory requirements. Nature of Work Step Analysis / Verification Risk Statutory Non-Compliance. Nature of Control Manual

1. Check that a checklist is maintained for all statuary compliances along with the due dates of complying the same.

2. Check that license related to power has been obtained and updated regularly. 3. Check that statutory compliance checklist is analyzed and updated regularly. 4. Check whether all the statutory compliances are ensured by the department. 5. Report needs to be viewed manually as there is no checklist available in SAP as a standard

solution.

8.IA.6 Service Colony and Industrial Building, Air Conditioners, Production Installations,

Projects, Rigs - SOP compliance Control Objective Compliance of SOP Nature of Work Step Analysis / Verification Risk Non compliance to SOP. Nature of Control Manual

1. Check that company has a well-defined SOP for servicing. 2. Check that all process is being followed as per SOP. 3. Check any deviation from SOP and document the reason given for same. Analyze its

reasonability and quote. 4. Check that ISO standards have been met with.


Projects, Rigs - Security Control Objective To minimize risk of thefts and prevent financial losses Nature of Work Step Verification Risk 1. Theft

2.Financial Losses

Nature of Control Manual 1. Check that management has identified critical areas in terms of thefts. 2. Check the management has a plan of action to stop any theft. 3. Check that CCTV's are in place to track any such case and is monitored by a security person. 4. Check any major theft reported during the audit period.

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Projects, Rigs - Statutory Compliances Control Objective To ensure compliance to various statutory requirements Nature of Work Step Verification Risk Statutory Non Compliance.

Nature of Control Manual 1. Check that a checklist is maintained for all statutory compliances along with the due dates of

complying the same. 2. Check that license related to power has been obtained and updated regularly. 3. Check that statutory compliance checklist is analyzed and updated regularly. 4. Check whether all the statutory compliances are ensured by the department.


Projects, Rigs - HSE compliances Control Objective Compliance with HSE laws Nature of Work Step Verification Risk Non Compliance to HSE Laws.

Nature of Control Manual 1. Check that all HSE norms are complied with. 2. Check that health of workers is not compromised on any count. 3. Check that adequate safety measures are available within the premise and workers are adhere

to the same.

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9. Employee Relations – Internal Audit

Scope Audit Areas

1 Appraisal policy and process

2 Appraisal process

3 Eligibility and approvals

4 Written examination

5 Recent promotions

6 Employee interaction and communication

7 Raising requisitions

8 Mode of recruitment

9 Recruitment notice

10 Evaluation process

11 Finalization of selection and pre-joining formalities

12 Contract employees

13 Joining process

14 Recruitment expenses

15 Legal/ Vigilance/ RTI

16 Planning and administration

17 Contracting for services

18 Quality of services

19 Allotment of company quarters & maintenance


21 Budgeting

22 Reimbursements for expenses

23 Loans & advances

24 PF Loan / Withdrawal

25 Maternity Leave / Special Leave

26 Final settlement of dues to nominees of deceased employee

27 Payroll - processing and disbursement

28 Statutory compliance

29 Grievance management system

30 Employee separation

31 Job rotation and transfer

32 Labor union

33 PR tracking


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9.IA.1 Appraisal Process - Appraisal Policy and Process Control Objective Clearly defined policy and process to be followed Nature of Work Step Analysis / Verification Risk Non Compliance to policy Nature of Control Manual/ Automated

1. Check that policy for Promotion is available and duly authorized. Check whether annual plan is timely prepared and approved by competent authority as per DOP.

2. Check if there exists a Company policy for Performance Management System (PMS)/ Appraisal in the Company.

3. Use T-Code APPSEARCH to view the Reporting Options for Appraisals. Check if the process of Performance Management System (PMS) clearly defines the timelines, authority and protocols to be followed for PMS.

4. Use APPSEARCH to check the eligibility criteria's defined for promotions for all grades.

9.IA.2 Appraisal Process Control Objective Adherence to defined and transparent appraisal process Nature of Work Step Analysis / Verification Risk Biased appraisal process. Nature of Control Manual/ Automated

1. Check if the appraisal is conducted in accordance to the defined policy and process. 2. Check if the self-appraisal is adequately documented and then reviewed by the appraiser with

feedback on strengths and improvement areas. 3. Check if the compilation of initial ratings are done by ER department and reviewed in line with

policy. 4. Check if adequate process is followed for normalization and approved as per DOP. 5. Check if the final rating on the basis of following parameters are accurately calculated and then

finalized. 6. Check if the improvement areas are communicated to L&D for planning of required trainings. 7. Check if standard Performance Related Pay (PRP) have been decided by the Company and

informed to all employees. 8. Check if the final incentive and increments are accurately decided and circulated in accordance

to the Performance Related Pay (PRP) ratings as decided by the Company.

9.IA.3.1 Appraisal Process - Eligibility and Approvals Control Objective Eligible employees are promoted only

Nature of Work Step Analysis / Verification Risk 1. Biased appraisal process. 2. Unauthorized appraisal. Nature of Control Manual/ Automated

1. Use T-Code S_AHR_61016356 to check that list of persons eligible for promotion is prepared at each level and cross check it from eligibility criteria.

2. Use T-Code S_AHR_61016356, S_L9C_94000095 to check the number of eligible candidates against the total number of vacant seats.

3. Use T-Code APPSEARCH, PA40 to check if all promotions are adequately approved as per defined DOP.

4. Use T-Code PA40, APPSEARCH to check if promotion is decided after considering all the parameters according to the policy (e.g. experience, seniority etc.)

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9.IA.3.2 Appraisal Process - Eligibility and Approvals

Control Objective Only department approved candidates are promoted

Nature of Work Step Analysis / Verification

Risk 1. Biased appraisal process. 2. Unauthorized appraisal.

Nature of Control Manual/ Automated 1. Use APPSEARCH to check that the list of employees eligible for promotion was vetted by

concerned departments. 2. Check the time taken in sending documents to department for approval and time taken by

department for approving the same. 3. Check whether applications received in this regard have been forwarded to the concerned

department for scrutiny of final details.

9.IA.4 Appraisal Process - Written Examination Control Objective Fair and timely examination for promotion


Risk 1. Biased appraisal process. 2. Unauthorized appraisal.

Nature of Control Manual/ Automated

1. To check whether selection committee was constituted before conducting the exam.

2. Use T-Code S_AHR_61015517, S_AHR_61015518, to check whether all eligible candidates were issued call letters clearly specifying the date and venue for examination.

3. Use T-Code PA30, PA40, S_AHR_61015514, to check that medical examination was conducted for all shortlisted candidates.

4. Use T-Code S_AHR_61016503 to check the time taken in issuing promotion letters from final selection.

9.IA.5 Appraisal Process - Recent Promotions Control Objective Recent Promotions Nature of Work Step Analysis / Verification Nature of Control Manual/ Automated

1. Use T-Code S_AHR_61016503 to review the APR marks / merit list with the promotions announced.

2. Use T-Code PA30 to check whether employee master is updated with new salary structure and grades immediately after announcement.

3. Use T-Code S_AHR_61016356, S_L9C_94000095 to check the total number of employees promoted against the total number of vacant seats.

9.IA.6 Appraisal Process -Employee interaction and communication Control Objective Employee Interaction and Communication Nature of Work Step Analysis / Verification Risk Employee dissatisfaction may lead to attrition. Nature of Control Manual

1. Check the process of intimation and communicating with employees on performance. 2. Check the controls over issue of promotion letter to the employees like authorized person to

issue the same and mode of giving.

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9.IA.7 Contract Labour & Recruitment - Raising Requisitions Control Objective All recruitments are done based on requisitions Nature of Work Step Analysis / Verification Risk Late and unauthorized hiring of manpower. Nature of Control Manual / Automated

1. Use T-Code S_AHR_61015508, S_AHR_6105512 to check the process of raising the manpower requisition for all recruitment is followed (except pre-planned mass hiring of fresher or as per business expansion plan).

2. Check if the manpower requisition is raised on timely basis. 3. Check if manpower requisition is complete in all respect and contains all the required

information about the position to be filled by HR. 4. Check if the manpower requisition is approved as per DOP. 5. Use T-Code PA40, PA30 to check the time lag after raising the requisition to finally hiring the

person. 6. Use T-Code S_AHR_61015514, S_L9C_94000095 to check the mode of recruitment is same as

planned as per the defined policy. 7. Use T-Code S_AHR_61016499 to check that all requisitions contain clear job descriptions and

experience of individuals to be recruited.

9.IA.8 Contract Labor& Recruitment - Mode of recruitment Control Objective Selection of mode of requirement based on cost and other factors Nature of Work Step Analysis / Verification Risk 1. Excess recruitment cost.

2. Fair recruitment process 3. Statutory Compliance.

Nature of Control Manual/ Automated 1. Use T-Code S_AHR_61015516 to check that last date of application is mentioned on the notice

of vacancy. 2. Use T-Code S_AHR_61015516 to check recruitment plan is prepared in advance and approved

by HOD for recruitments to be done during the period so that timely recruitment is done considering the mode of recruitment.

3. Use T-Code S_AHR_61015515, CV03N to check if proper documentation is available to substantiate that recruitment is conducted from the same mode in which it is planned.

4. To check if all the required guidelines issued from time to time are followed for recruitment considering equal opportunity to all eligible candidates.

5. Use T-Code S_AHR_61015515, PA20 to check all statutory compliances like reserved seats have been fulfilled.

6. Use T-Code PT03, PT_DSH20 to check the policy and processes are in line with new statutory laws and regulations like the working hours requirements.

9.IA.9 Contract Labor& Recruitment - Recruitment notice Control Objective Selection based on defined process Nature of Work Step Analysis / Verification Risk Unfair recruitment process. Nature of Control Manual/ Automated

1. Use T-Code S_AHR_61015516, PB40 to check if recruitment process is started according to the basis of defined plan.

2. Use T-Code S_AHR_61015517 to check if proper notice/ advertisement is issued for all the vacancies defining the following:

a. Job requirement and responsibilities

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b. Eligibility criteria c. Educational qualifications d. Experience criteria e. e. Evaluation criteria etc.

3. Use T-Code S_AHR_61015518 to check if the advertisement is published at all the required places (e.g. newspaper and websites etc.).

4. In case of campus recruitments, use T-Code S_AHR_61015518 to check if the recruitment is done from the pre-approved institution.

5. Use T-Code S_AHR_61015510,S_AHR_61015513 to check the list of candidates shortlisted for interview and their experience papers.

6. Use T-Code S_AHR_61015510,S_AHR_61015513 to check that no application has been accepted which has been received after the last date unless approved.

7. Use T-Code S_AHR_61015510,S_AHR_61015513 to check if adequate tracking and monitoring process is in place to ensure completion of recruitment process in time.

9.IA.10.1 Contract Labor& Recruitment - Evaluation Process Control Objective Screening Nature of Work Step Verification Risk 1. Unfair recruitment process.

2. Unauthorized hiring. Nature of Control Manual/ Automated

1. Use T-Code S_AHR_61015510, S_AHR_61015513 to check if timely and adequate screening is done to identify the eligible candidates for proceeding with the recruitment process.

2. Use T-Code PA20, PA30 to check if the screening is done by the authorized and independent person to objective screening of the candidates.

3. Check if the final list of eligible candidates is prepared and approved by HOD to process for further process.

4. Verify sample cases to check if all the candidates are eligible as per the requirement posted in advertisement.

5. Use PA30 to check if adequate mix is maintained to adhere to the various regulation and quotas (e.g. SC/ST vacancies).

9.IA.10.2 Contract Labor& Recruitment - Evaluation Process Control Objective Initial screening of documents Nature of Work Step Verification Risk 1. Incomplete documentation.

2. Possibility of fraudulent documents. Nature of Control Manual/ Automated

1. Check if the copies and original of the required documents are verified to ensure appropriateness of the details mentioned in the application form.

2. Use T-Code S_AHR_61015513 to check if results are adequately documented and then on eligible candidates are selected.

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9.IA.10.3 Contract Labor& Recruitment - Evaluation Process Control Objective Written Test Nature of Work Step Verification Risk Non-Compliance to policy. Nature of Control Manual/ Automated

1. Use T-Code S_AHR_61015513 to check whether written test was conducted according the timelines mentioned in the advertisement or communicated thereafter.

2. Use T-Code S_AHR_61015513, S_AHR_61015517 to check if any change in the date of test is communicated well in advance to the eligible candidates.

3. Use T-Code S_AHR_61015513 to check if process is in place to ensure that written test is given by the candidate himself.

4. Use T-Code PBAF to check if adequate evaluation of the written test is conducted in time for selection of candidates. Check whether proper technical survey/inspection is carried out for quality assurance before creation of SES.

9.IA.10.4 Contract Labor& Recruitment - Evaluation Process Control Objective Interview Nature of Work Step Verification Risk Transparent selection process. Nature of Control Manual/ Automated

1. Check if the interview panel is finalized and approved in advance as per DOP. 2. Check if adequate mix of the interview panel is maintained in line with the required policy (e.g.

if recruitment involves SC/ST candidate, then 1 member must be SC/ST category). 3. Use T-Code S_AHR_61015513 to check all interview processes are completed within specified

time. 4. Use T-Code S_AHR_61015513, PB10 to check if the interview evaluation sheet is prepared and

the rating of each candidate (for all rejected/ selected candidates). 5. Post the interview; use T-Code S_AHR_61015513 to check if a report is prepared by the

interview panel which is put to competent authority for approval stating result of the recruitment process.

9.IA.10.4 Contract Labor& Recruitment - Evaluation Process Control Objective Medical Examination Nature of Work Step Verification Risk Non-Compliance to policy. Nature of Control Manual/ Automated

1. Use T-Code S_AHR_61015513 to check if upon approval, the final candidates are called for medical examination. On clearance of the same, offer letter is sent to the candidate for joining.

9.IA.11.1 Contract Labor& Recruitment - Finalization of Selection and Pre-Joining

Formalities Control Objective Proper approvals and selection Nature of Work Step Verification Risk Non-Compliance to policy. Nature of Control Manual/ Automated

1. Use T-Code PB30 to check if adequate documentation is maintained for all the evaluation conducted for finalizing the candidates.

2. To check whether medical examination was conducted for all shortlisted candidates. 3. To check whether all conditions like selection of quota candidates has been adhered to.

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4. To check that all offer letters are issued as per standard format as per the HR policies of the Company.

5. Use T-Code S_AHR_61015513 to check if the offer letter clearly defines the documents which the candidate need to submit before joining.

6. Use T-Code S_AHR_61015513 to check if the offer letter clearly defines other requirements (if any) which the candidate need to fulfill before joining.

7. Use T-Code S_AHR_61015513 to check if the offer letter is issued based on approval from authorized person as per DOA.

9.IA.11.1 Contract Labor& Recruitment - Finalization of Selection and Pre-Joining

Formalities Control Objective Pre Joining Formalities Nature of Work Step Verification Risk Non-Compliance to policy.

Nature of Control Manual/ Automated 1. To check that all rejoining formalities like maintenance of employee files, medical checks have

been done. 2. Use T-Code S_AHR_61015513 to check whether employee files are properly maintained and

contain necessary documents like blood group report. 3. To check the reference check and background check forms have been documented in employee

files. 4. Use T-Code S_AHR_61015513 to check whether offer letter clearly states the last date of joining

unless approved by concerned authority.

9.IA.12.1 Contract Labor & Recruitment - Contract Employees Control Objective Contract Employees - Recruitment Nature of Work Step Analysis / Verification Risk Non-Compliance to policy.

Nature of Control Manual/ Automated 1. Check if recruitment on contract basis is done in case of urgency which could not be planned in

the manpower plan. 2. Check if the contractual recruitment is initiated on the basis of approved manpower requisition

by competent authority stating the justification of such recruitment. 3. Use T-Code S_AHR_61015513 to check if the adequate evaluation process from screening to

finalization is followed for contracted employees. 4. Use T-Code S_AHR_61015513 to check if the contract with the employee is duly approved by

legal and for the limited period of requirement. 5. Use T-Code S_AHR_61015513 to check the process of renewal of candidate is followed after

ensuring equal opportunity to all prospective candidates unless approved by the competent authority as per DOP.

6. Use T-Code S_AHR_61015513 to check if the entire documentation requirement is completed for the contracted employee before joining.

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9.IA.12.2 Contract Labor & Recruitment - Contract Employees Control Objective Contract Employees - Statutory Compliance Nature of Work Step Analysis / Verification Risk Non-Compliance to policy.

Nature of Control Manual/ Automated 1. Check if the process is in place to ensure the statutory compliance in relation to the contract

employees. 2. Use T-Code PA30, PA40 to check if the compliance checklist is in place describing the

compliances need to be ensured, including various labor and PF laws. 3. Use T-Code PA30, PA40 to check if the compliances are ensured and non-compliances are

tracked with action plan for compliance.

9.IA.13 Contract Labor & Recruitment - Joining Process Control Objective Collection and documentation of mandatory documents in employee

personnel file, To smoothen the entry of newly joined executives in the organization

Nature of Work Step Verification Risk 1. Over/Under-utilization of manpower.

2. Operational delays caused due to low manpower. Nature of Control Manual/ Automated

1. Use T-Code PA30, PA40 to check the periodicity for conducting the induction for the newly joined employees.

2. Check whether the data specified in the induction template / document have been updated from time to time.

3. Use T-Code S_AHR_61016494 to check whether Job responsibilities/ descriptions (JDs) are adequately defined for all positions and communicated to employees at the time of joining.

4. Use T-Code PA30, PA40, CV03N to check whether copy of all the mandatory certificates and photo ID cards have been collected from the employee.

5. Use T-Code SUIM -->PA30 and PA40 to check employee master data and personal files are accessible by authorized personnel only.

6. Use T-Code S_AHR_61015513, PA40 to check the time lag (if any) in generation of the joining report for the new employees.

7. Use T-Code S_AHR_61015513 to check the dates of sign off on the appointment letters issued to the employees.

8. Use T-Code PA30, PA40 to check if the employee file is updated with all the records and documents w.r.t. to the new employee.

9.IA.14 Contract Labor& Recruitment - Recruitment Expenses Control Objective Ensure adequate control over expenses incurred for recruitment Nature of Work Step Analysis / Verification Risk Weak control over expenses.

Nature of Control Manual/ Automated 1. Use T-Code KSBL to check if adequate budget is in place for incurring the recruitment expenses. 2. Use T-Code S_ALR_87013611 to check if Budget Vs. actual is monitored for all recruitment

expenses. 3. Check if all expenses are incurred with prior approval according to DOP. 4. Use T-Code PA30, PA40, PC00_M40_REMS to check if re-imbursement to candidates is made

based on eligibility and with adequate approval as per DOP. 5. Use T-Code S_ALR_87013611 to check if recruitment expenses are properly accounted and

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monitored.

9.IA.15.1 Contract Labor& Recruitment - Legal/ Vigilance/ RTI Control Objective Legal/ Vigilance Nature of Work Step Analysis / Verification Risk Legal non-compliance.

Nature of Control Manual/ Automated 1. Check the maintenance of a tracker of the active and resolved legal cases in timely manner. 2. Check if the checklist if maintained for the required documentation to be maintained for each

legal case. 3. Check the maintenance of documentary proof and witness for the cases. 4. Use T-Code S_ALR_87014259 to check if settlement of employee full and final post solvation of

the dispute. 5. Check if the past cases are reviewed and analyzed for common reasons with action plan to

prevent such cases in future. 6. Check if there is adequate tracking and documentation of the cases initiated by vigilance.

9.IA.15.2 Contract Labor& Recruitment - Legal/ Vigilance/ RTI Control Objective RTI cases Nature of Work Step Analysis / Verification Risk Legal non-compliance.

Nature of Control Manual/ Automated 1. Check the maintenance of a tracker to monitoring and ensuring reply for all RTI cases in timely

manner. 2. Check if the dedicated persons are identified for handling the RTI cases. 3. Check if all replies to RTI are properly verified and supported with adequate documentation to

ensure accuracy of reply. 4. Use T-Code CV03N to check if proper evidence is maintained ensuring date of receipt of RTI and

reply to RTI.

9.IA.16 Welfare & Sports - Planning and Administration Control Objective To ensure appropriate cost of the Trainings Nature of Work Step Analysis / Verification Risk 1. Weak budgetary control over expenses.

2. Unauthorized expenses. Nature of Control Manual/ Automated

1. Use T-Code S_ALR_87013611 to verify the actual vs. budgeted amount sanctioned for the Welfare and sports.

2. Use T-Code S_ALR_87013611 to analyze the root cause for any significant variation in the budget vs. actual.

3. Check whether the expenses incurred by the department are in adherence to the documented company policy.

4. Check on sample basis if the expenses are supported with adequate approvals and evidences. 5. Analyze the root cause for excess fund utilization than sanction for trainings.

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9.IA.17 Welfare & Sports - Contracting for Services Control Objective To ensure adherence to company policy and procedures Nature of Work Step Analysis / Verification Risk Non-Compliance to Company Policy.

Nature of Control Manual/ Automated 1. Use T-Code ME23N, ME2S to check if the services obtained on contract are in accordance to the

company policy. 2. Use T-Code KSBL to check if the all procurement is done on the basis of approved plan and

requirement. 3. Use T-Code ME49, ME4L, and ME80AN to check if the adequate evaluation of quotations and

services is done prior to engagement of service provider. 4. Use T-Code FBL1N to check if all the payments processed are in accordance to the contract. 5. Use T-Code FBL1N to check if adequate retention is made or LD levied for any shortcomings in

the services.

9.IA.18 Welfare & Sports - Quality of Services Control Objective To ensure adequate quality of welfare and services for workmen Nature of Work Step Verification Risk Employee dissatisfaction.

Nature of Control Manual/ Automated 1. Use T-Code ME23N, ME2S to check whether the services planned to be provided and required

for welfare and motivation of the workmen are provided (e.g. Gym facility, market etc.). 2. Check whether management encourages employees to participate in physical activities by

hosting Championships within or outside the company. 3. To check physically the condition of the services and facilities (e.g. sports equipment). 4. Check if adequate process is in place to ensure upkeep of the all the facilities. 5. Conduct physical verification on sample basis for the facilities and equipment provided to

workmen. 6. To check if all the safety and regulatory requirements are adhered while provisioning of the

facilities. 7. To check if process of recording complaint and feedback from workmen is in place. 8. Check if all the complaints and feedback are reviewed and action is planned for improvement.

9.IA.19 Welfare & Sports - Allotment of Company Quarters & Maintenance Control Objective To ensure adherence to company policy and procedures Nature of Work Step Analysis / Verification Risk Non-Compliance to Company Policy.

Nature of Control Manual/ Automated 1. Check if accommodation is provided to eligible candidates only in accordance to the defined

policy. 2. Use T-Code PA30 to check if timely updation is done in the payroll master to stop HRA and

related allowances, after allotment of official quarters. 3. Check if adequate maintenance is ensured for all the units.

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9.IA.20 Others - Manpower Planning Control Objective To ensure right number of persons are available at the right time and at the

right place Nature of Work Step Analysis / Verification Risk Overstaffing/under staffing in the department.

Nature of Control Manual 1. Check if there is defined process for assessing manpower requirement of a function or a

department. 2. Check if the planning process is initiated and completed on timely basis as per the defined

procedure. 3. Check if the departmental requirement as assessed, compiled and consolidated to assess the

overall requirement of the company. 4. Check that manpower plan has been made for each department separately. 5. Check whether the process of monitoring the budgeted manpower strength and the actual

manpower strength against the same is followed. 6. Check if all the manpower requirements are approved as per the defined DOP.

9.IA.21 Others - Budgeting Control Objective Control expenditure Nature of Work Step Analysis / Verification Risk Cost overrun.

Nature of Control Manual/ Automated 1. Use T-Code S_ALR_87013611 to check the current year budgeted expenditure of manpower

cost and compare the same with actual cost for current year as well as previous year budgeted expenditure.

9.IA.22 Others - Reimbursements for expenses Control Objective To facilitate processing of timely reimbursement to work persons for medical

treatment Nature of Work Step Analysis / Verification Risk 1. Employee dissatisfaction.

2. Non-compliance to Company policy. Nature of Control Manual/ Automated

1. Use T-Code S_PH9_46000172 to check the adherence to the policy and procedure for reimbursement of the bills of employees.

2. Check whether process of maker checker and adequate verification of all the bills is in place. 3. Check whether proper serial controlled tracking is done for all the claims submitted. 4. Use T-Code S_PH9_46000172 to check whether there was any time lag in submission of medical

expenses for scrutiny & recommendation to Medical Dept. and disbursement of reimbursement.

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9.IA.23 Others - Loans & advances Control Objective To facilitate loans and advances to the work persons (e.g. HBL, Car, appliance

etc.) Nature of Work Step Analysis / Verification Risk 1. Employee dissatisfaction.


1. Use T-Code S_PH9_46000172 to check the amount and approval of various loans and advances granted to work persons.

2. Use T-Code PA30, PA40 to check whether F&A department has checked the eligibility & repaying capacity.

3. Use T-Code FBL1N to check whether any personnel has scrutinize and verified application and documents / previous utility loan records.

4. Use T-Code FBL1N to check if process is in place to ensure timely recovery of the loan and advance as per the policy.

5. Use T-Code FBL1N to check ageing of various such loans and advances and do reason analysis for old outstanding.

6. Check if adequate follow-up is done for old pending recoveries. 7. Use T-Code FBL1N to check if any loans and advance is pending from left employees.

9.IA.24 Others - PF Loan / Withdrawal Control Objective To facilitate loans and advances to the work persons Nature of Work Step Analysis / Verification Risk 1. Employee dissatisfaction.


1. Use T-Code S_PH9_46000172 to check whether application form / employees’ particulars and dependent record have been verified.

2. Use T-Code S_PH9_46000172 to check whether PF loan register has been updated within specified time frame.

9.IA.25 Others - Maternity Leave / Special Leave Control Objective To facilitate leaves to the work persons Nature of Work Step Analysis / Verification Risk 1. Employee dissatisfaction.


1. Use T-Code PA30, PA40 to check the applications of employee for leave with recommendation from HOD and in case of maternity leaves a recommendation by Head of Medical.

2. Use T-Code PA30, PA40 to check whether approval of ER/ authorized officer is obtained for leaves sanctioned.

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9.IA.26 Others - Final settlement of Dues to Nominees of Deceased Employee Control Objective To facilitate timely settlement of dues Nature of Work Step Analysis / Verification Risk 1. Employee dissatisfaction.


1. Use T-Code PC00_M99_CWTR to verify the payment advice of Social Security System (SSS) & Employees Deposit Linked Insurance Scheme (EDLI) and approval by concerned officer along with Form 7(PF) and Form L&I (Labor and Industries).

9.IA.27.1 Others - Payroll - Processing and Disbursement Control Objective Employee Master Maintenance Nature of Work Step Analysis / Verification Risk Unauthorized changes in employee master.

Nature of Control Manual/ Automated 1. Use T-Code SUIM to check if the access to add or modify the employee master is restricted to

authorize persons only. 2. Use T-Code S_AHR_61016360 to check whether all the changes in the audit period are duly

authorized as per the defined policy and DOP. 3. Use T-Code SM20 to check whether audit logs are maintained and reviewed for the changes to

employee masters.

9.IA.27.2 Others - Payroll - Processing and Disbursement Control Objective Leave & Attendance records Nature of Work Step Analysis / Verification Risk 1. Unauthorized changes in attendance and leave records.

2. Incorrect attendance may lead to incorrect payroll processing. Nature of Control Manual/ Automated

1. Use T-Code PTMW, PT40 to review the attendance monitoring process and ensure that office timings are communicated to all employees and correctly mapped in the attendance recording system.

2. Use T-Code PT64, PT62 to check if the attendance is duly recorded and monitored. 3. Use T-Code PT64, PT62 to verify whether attendance records are maintained and cross checked

by an independent personnel. 4. Use T-Code PT64 to ensure that leave balances are correctly recorded and carried forward to

the next year. 5. Use T-Code SUIM to examine the access rights to attendance and leave recording system and

ascertain whether access rights are in line with the roles and responsibilities defined. 6. Use T-Code PT62, PC00_M99_PA03_check to ensure that the attendance and leave records are

approved/authorized as per the process before considered for monthly payroll. 7. Use T-Code SUIM to check whether logs of access/ changes to the attendance and leave records

are prepared and reviewed.

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9.IA.27.3 Others - Payroll - Processing and Disbursement Control Objective Payroll - Processing and Disbursement Nature of Work Step Analysis / Verification Risk Financial loss to the Company.

Nature of Control Manual/ Automated 1. Use T-Code PT62, PC00_M99_PA03_check to check if correct leave records are used for

processing of salary and the same tally with the attendance records maintained by the company.

2. Use T-Code PA30 to check the logs generated for changes in the employee master data after payroll processing.

3. Use T-Code PA30 to test check salary computations for employees. Ensure the salary processed is as per the Offer/Appointment letter of the employee or as per increment letter in case of increment given.

4. Use T-Code PA30 to check if any arrears to salary are accurately processed and duly approved before disbursement.

5. Use T-Code PA30, PC00_M99_PA03_check to ensure that leave encashment, overtime etc. are computed accurately and in accordance to the company policy.

6. Obtain and understand policies and procedures defining entitlement, time of submitting claim, approvals etc.

7. Examine the process of submission of reimbursements by the employee. 8. Use T-Code FBL1N to check for any advances or loans paid to the employees, and if deductions

are paid for the same from the salary. 9. Use T-Code FBL1N to review the disbursement of payroll is in accordance to the approval payroll

processed. 10. Use T-Code FBL1N to review and analyze the payment disbursement for current month with last

two months (employee wise). 11. Use T-Code FBL3N, PC00_M99_PA03_check to check the payroll variance report and investigate

instances wherein there is a huge variance between the salaries paid during the months. 12. Use T-Code FBCJ to examine the cases where disbursement of salary was made through cash (if

any).

9.IA.28 Others - Statutory compliance Control Objective To ensure timely and accurate compliance to all statutory requirements. Nature of Work Step Analysis / Verification Risk Statutory non-compliance.

Nature of Control Manual/ Automated 1. Check whether any checklist for tracking and ensuring the compliance to all statutory

requirements is maintained. 2. Use T-Code FBL3N to check if the department is ensuring the compliance to all statutory

requirements. E.g. a. PF b. ESI c. Gratuity d. Other labor laws.

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9.IA.29 Others - Grievance Management System Control Objective Employee satisfaction and timely redressal of employee grievances Nature of Work Step Analysis / Verification Risk Employee dissatisfaction.

Nature of Control Manual 1. Check the system of receiving employee grievances. 2. Check the time taken to address the employee grievance. 3. Check steps taken to ensure employee satisfaction.

9.IA.30.1 Others - Employee Separation Control Objective Resignations Nature of Work Step Analysis / Verification Risk 1. Non-compliance to Company policy.

2. High attrition may lead to low efficiency in the Company. Nature of Control Manual/ Automated

1. Use T-Code PA30 to check the adherence to the Company policy guidelines for employee separation.

2. Use T-Code S_L9C_94000095 to check and analyze the attrition rate at the various management level.

3. Use T-Code PA30, PA40 to check if the employee resignation is documented and accepted by HOD before relieving.

4. Check if intimation is send to the ER department and payroll team by HOD on receipt of resignation.

5. Use T-Code PA30, PC00_M99_PA03_check to check if payroll is put on hold (in line with the policy requirement) on receipt of employee resignation.

6. Check if employee is communicated to all the requirements need to be completed by him before leaving the organization:

a. No due to be cleared b. Assets to be returned c. Guarantee/ bond amount to be paid if any d. Notice to be served etc.

7. Check if ER department initiates the retirement process in advance in case of retiring employee. 8. Check whether data backup have been obtained from the employee before his relieving.

9.IA.30.2 Others - Employee Separation Control Objective Clearance Procedure Nature of Work Step Analysis / Verification Risk 1. Non-compliance to Company policy.

2. Data loss. Nature of Control Manual/ Automated

1. Check if clearance/ no due form is defined containing the authorities who need to give no due clearance to all separating employees.

2. Use T-Code PA30, FBL1N to check if all the receivables/recoverable are mentioned on the clearance form before by the authorized person.

3. Use T-Code SUIM to check if all the following access are removed at the time of clearance: a. Physical access card (if any) b. SAP Access by ERP team c. Oil Network Access by IT team d. Access to any other IT application by IT team.

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4. Use T-Code PA40 to check if all the authorizations to the individual (if any) are removed: a. Bank Account b. Dealing with third parties c. Representing company d. Power of Attorney etc.

9.IA.31 Others - Job Rotation and Transfer Control Objective Job transfers within or outside the department for personal growth and

avoiding monotonous jobs Nature of Work Step Analysis / Verification Risk 1. Non-compliance to Company policy.

2. Low efficiency due to untrained employees. 3. Incorrect payroll processing for overlapping period.


1. Use T-Code PA30 to check the adherence to annual job rotation plan. 2. Use T-Code PA30 to check whether the person transferred has been transferred on the basis of

transfer policy. 3. Use T-Code PA30 to check if the company policy w.r.t to mandatory transfers is followed for all

employees unless specific approval is obtained from the competent authority. 4. Check if in case of extension in transfer / job rotation, approval from competent authority have

been obtained. 5. Use T-Code PSV2 to check that proper training has been imparted in case new job

responsibilities are to be performed after transfer. 6. Use T-Code PA30 to check the time lag in processing the transfer requests. 7. Use T-Code PA30 to check whether the SAP has been updated with revised transfer details. 8. Use T-Code PC00_M99_PA03_check to check accuracy of the payroll process for the overlapping

period.

9.IA.32 Others - Labor Union Control Objective To ensure timely and effective settlement with labor unions Nature of Work Step Analysis / Verification Risk Operational delays.

Nature of Control Manual 1. Check if there is defined responsibility to handle the labor unions. 2. Check if the settlements with labor union are adequately documented, approved and

implemented. 3. Check if there is defined procedure to handle the matter in relation to the labor union. 4. Check if there is defined process for addressing labor unrest and negotiating with labor unions.

9.IA.33 Others - PR Tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Analysis / Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /

operational delays. Nature of Control Automated/ Manual

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9.IA.34 Others - Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material Nature of Work Step Verification Risk 1. Delays in payments.

2. Incorrect payments. Nature of Control Automated/ Manual

1. To check whether status of work completion in manual records is updated as per contract terms. Use T-code ME2S/MSRV1.

2. To check whether confirmation or acknowledgement of work completed is taken from contractor on manual records.

3. To check whether the manual records are verified and approved by concerned authority. 4. Use T-Code ML84 to view the list of SES's and ML81N to view the details of specific SES. Check




delays.

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10. ERP – Internal Audit

Scope Audit Areas

1 SAP change management

2 Access controls

3 SAP users and license controls

4 Master data maintenance

5 Audit logs

6 SAP budget and related expenses

7 User training and SAP usage

8 PR tracking

9 Contract monitoring



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11. Exploration & Development (ED) – Internal Audit

Scope Audit Areas

1 Acquisition of blocks

2 Monitoring of blocks

3 PR Tracking

4 Manpower Planning


6 Technical Support

7 Financial Review

8 IT Infrastructure

9 Legal Aspects

10 PR Tracking

11 Manpower Planning


13 Monitoring of Operator function and financial probity

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11.IA.1 ED - PR tracking Control Objective Timely raising of PR and monitoring







11.IA.2 ED - Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities. Nature of Work Step Analysis / Verification Risk 1. Over/Under Utilization of manpower.




11.IA.3.1 CEMG - Financial Review Control Objective Financial support to bid evaluation group

Nature of Work Step Verification / Analysis

Risk Incorrect evaluation. Nature of Control Manual

1. Check the adequacy of financial support services provided by CEMG to bid evaluation group including financial data validation.

11.IA.3.2 CEMG - Financial Review Control Objective Financial support for JOA finalization


Risk Negotiation of unfavorable terms. Nature of Control Manual

1. Check the adequacy of process of JOA negotiation/discussion with partners and finalization of the same before submission.

11.IA.3.3 CEMG - Financial Review Control Objective Regular audit of financial statements of the Joint Venture by the audit firm

defined in the PSC/JOA. Nature of Work Step Analysis

Risk Non compliance to internal policies. Nature of Control Manual

1. Check the process of appointment of auditor and whether the same has been followed. 2. Take audited reports and check the same with PSC and JOA figures.

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11.IA.3.4 CEMG - Financial Review Control Objective Adequate monitoring of cash calls


Risk Incorrect cash calls. Nature of Control Automated / Manual

1. Review the process of monitoring of cash calls including exceptional reporting. Use T Codes GJ03, GJ04,GJ06 for JV / Non-JV cash call accounting in SAP.

11.IA.3.5 CEMG - Financial Review Control Objective Timely evaluation of performance of blocks


Risk Delays in evaluation. Nature of Control Automated / Manual

1. Check whether there is adequate process of collection of data from all spheres, analysis of data for monitoring the financial performance of JV/NELP blocks. Use T code GJ_GD13.

11.IA.3.6 CEMG - Financial Review Control Objective Monitoring of BG & LD


Risk Expired BG. Nature of Control Automated / Manual

1. Check the process of preparation and monitoring of BG & LD documents as per PSC/JOA for onward submission to DGH/MOP&NG. Use T code FBL1N.

11.IA.3.7 CEMG - Financial Review Control Objective To verify whether the operator has obtained adequate Insurance coverage.


Risk Inadequate cover against risk for assets. Nature of Control Manual

1. Check the Insurance chapter of the PSC & JOA and detail out the requirements to be met by the operator.

2. Check item by item compliance for the insurance coverage and report on the under-insurance/ over-insurance / co-insurance/ non-insurance.

3. Check provision of Insurance made in the budget.

11.IA.4.1 CEMG - Legal Aspects Control Objective Compliance with legal aspects of projects Nature of Work Step Verification / Analysis Risk Legal non-compliances. Nature of Control Manual

1. Check adherence to legal aspects of projects. Review the system of composite checklist for sample projects to ensure compliance to statutory norms and its synchronization with MWP.

11.IA.4.2 CEMG - Legal Aspects Control Objective Monitoring of legal and company affairs in relation to block PSCs, JOAs etc. Nature of Work Step Verification / Analysis Risk Legal non-compliances. Nature of Control Manual

1. Check the process followed for monitoring and addressable of legal and regulatory aspects.

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11.IA.4.3 CEMG - Legal Aspects Control Objective To review the compliance of a) Production Sharing Contracts (PSC)b)Joint

Operating Agreement (JOA) and draw out the salient features and conditions that the operator needs to comply with

Nature of Work Step Verification / Analysis Risk Non compliance to PSC and JOA may lead to:

a. Dis qualification of JV b. Heavy penalty to JVc. Cancelation of exploration license.

Nature of Control Manual 1. Prepare detail list of compliances under PSC and JOA:

A. Compliance of JOA / PSC will include following a. Requirements of the operating / Management committee b. Approvals in budgeting process c. Compliance to reporting to DGH & JV partners d. Basis of computation of various reporting's to DGH & JV partners e. Measurement of Petroleum f. Recovery of cost for Oil and Gas g. Production sharing of Oil and Gas h. Valuation of petroleum i. Assignment of interest j. Payment of fee to Government k. Bank Guarantee submission (Basis & Timely submission) l. Cost allocation basis m. Approvals thereof B. Compliance to JOA / PSC accounting procedures a. Government / License and assistance b. Certificates and notices

2. Use transaction code GJ54 for JOA details. a. Enter company code ‘JV’ b. Execute c. This report will display of the details of the Joint Operating Agreements for the company code JV.

3. Compare with the physical documents maintained. 4. Document and report on anomalies observed in reporting and compliance.

11.IA.5 CEMG - PR tracking Control Objective Timely raising of PR and monitoring







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11.IA.6 CEMG - Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities. Nature of Work Step Analysis / Verification Risk 1. Over/Under Utilization of manpower.



2. Ensure manpower requisition forms are raised timely and approved as per DOP. 3. Check whether there is a follow up process in place to ensure timely conversion of MPR

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12. Field Communication – Internal Audit

Scope Audit Areas

1 Planning, preparation and maintenance

2 Field communication

3 Technical up gradation


5 Issuance of spare items

6 PR tracking


8 Manpower planning

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12.IA.1 Planning, budgeting & monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,

compliance to DOP Nature of Work Step Analysis / Verification Risk Inadequate Planning and Non Compliance to DOP. Nature of Control Automated/Manual

1. To check whether the plan of field communication department is complete. 2. To check whether such plan is approved by competent authority as per DOP. Use T-code KSBL for

reports / verification. Version Management can be used to track changes. 3. To check whether any amendments in such plan is approved by competent authority as per DOP.

Use T-code KSBL. 4. To check whether actual expenses are monitored / compared with planned expenses on periodic

basis against such plan. Use T-codeS_ALR_87013532. 5. To check whether there are laid down procedures for preparation of the plan and maintenance

of equipment used. 6. To check whether such laid down procedures for preparation and maintenance are complied

with.

12.IA.2 PR tracking Control Objective Timely raising of PR and monitoring





conducted for delays.

12.IA.3 Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities. Nature of Work Step Analysis / Verification Risk 1. Over/Under Utilization of manpower.




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13. Field Engineering – Internal Audit

Scope

Audit Areas


2 Statutory Compliances

3 PR tracking


5 Manpower planning

6 SOP Compliance


8 Preventive maintenance

9 Breakdown maintenance

10 Cost control analysis

11 New project and achievements

12 Safety


14 Security


16 Tools, spares and other Expenses

17 HSE Compliances

18 Projects

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13.IA.1 P&A - Planning, Budgeting & Monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,


1. Check whether the annual plan of Field Engineering department is complete and all-inclusive to cover the requirements of all the activities that come under its purview.


a. Linked to the requirement of various departments b. Inclusive of all the related costs.



13.IA.2 P&A - Statutory Compliances Control Objective Adhere to regulatory and statutory compliances Nature of Work Step Verification Risk Non-compliance to statutory requirements.


complying the same. 2. Check that license related to power has been obtained and updated regularly. 3. Check that statutory compliance checklist is analyzed and updated regularly. 4. Check whether all the statutory compliances are ensured by the department.

13.IA.3 P&A - PR Tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Analysis / Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /






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14. Finance & Accounts

14.IA.1 Finance & Accounts – Asset Management

Scope Audit Areas

1 Acquisition of assets

2 Capitalization of assets

3 Depreciation

4 Physical verification of fixed assets

5 Disposal of fixed assets

6 Ownership documents

7 Accounting policies

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14.IA.1.1.1 Acquisition of Assets Control Objective Annual operating plans are prepared and circulated in advance to all the

respective departments, and Budgetary controls have been defined in SAP

Nature of Work Step Verification Risk Exceeding the capital budget. Nature of Control Automated / Manual

1. Use T-codes CJ31, CJ36 and CJ37 to check if budgets for capital expenditure are approved by the competent authority. (Check manual files in case authorizations are maintained outside SAP).

2. Check if the approved budgets are communicated in writing to the Purchase Department, Accounts Department and the department originating the request.

3. Check if written authorizations are required for incurring capital expenditure for items included in the budget.

4. Use T-code SUIM to check if the authority to incur capital expenditure is restricted to specified officials.

5. Use T-code S_ALRS_ALR_87013558 to ensure that there are proper checks to make sure that amounts expended do not exceed the amount authorized.

6. Use T-code SUIM to check authorizations required for excess expenditures. 7. Check whether supplementary budget has been authorized. 8. T-code S_ALR_87013558 may be used to check budget.

14.IA.1.1.2 Acquisition of Assets Control Objective Adequate gate/stores controls are in place Nature of Work Step Verification/Analysis Risk 1. Unauthorized material entry in the plant.

2. Possibility of loss to the material due to security lapses. 3. Possibility of issue of material directly to user.

Nature of Control Manual 1. Check availability of controls in purchase or availing of services. 2. Check if purchase of capital items is subject to same controls as applicable to purchase of raw

materials, stores, etc. 3. Check if receipt of capital items are subject to same procedures as applicable to receipt of raw

materials, stores, etc.

14.IA.1.1.3 Acquisition of Assets Control Objective Review whether procurement assets is done as per requirement Nature of Work Step Verification/Analysis Risk 1. Blockage of funds.

2. Deterioration of asset. 3. Underutilization of resources.

Nature of Control Manual / Automated 1. Perform aging analysis of capital items in stock (MB5B). 2. On a sample basis review whether utilization of material is being done as per plan contribution.

14.IA.1.2.1 Capitalization of assets Control Objective Full cost incurred to bring the asset to the current condition capitalized Nature of Work Step Verification

Risk Incorrect capitalization of fixed assets. Nature of Control Manual / Automated

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1. For project related capitalizations, review that the capitalization is performed on the basis of completion certificate and review that the completion certification has been appropriately approved.

2. Use T-code AR01 to check if all the cost incurred to bring the capital assets in the current form have been capitalized along with the capital assets.

3. Use T-code CJI3/KSB1 to check if all expenditure on wages, materials and stores have been charged to capital account on reasonable basis.

4. Check if there is any official responsible for ensuring that allocation of expenditure between capital and revenue is in accordance with the company's accounting policy.

5. To check all cost to bring asset in current form can be checked with ME2N and CJI3 and can be confirm with capitalize amount from AR01/AS03.

6. Check that Exploratory Wells in progress (EWIP) requiring artificial lift are not capitalized 7. Check that exploratory well-in-progress, which are ready to commence commercial production,

but have been capped for want of Customers, have been capitalized 8. Check that expenditure incurred on exploratory wells, which has been written off in past is not

written back even though, the well has started producing subsequently. Only the additional/subsequent portion of the expenditure on the well is to be capitalized.(Revised Guidance Note on Oil and Gas Accounting)

9. Check that expenditure incurred on a dry well in development area is capitalized. 10. Check for correct classification and disclosure of Computer software as Intangible assets as per

AS 26 or fixed assets as per AS 10. 11. Check for correct classification of fixed assets as per AS 10.

14.IA.1.2.2 Capitalization of assets Control Objective Timely capitalization of assets Nature of Work Step Analysis / Verification Risk Delay in capitalization of asset. Nature of Control Manual / Automated

1. Review CWIP register (manual/ in SAP - T-Code: ZCWIP_REP) and check i) Any balances in CWIP for projects completed ii) Any long pending balances in CWIP.

2. Review whether developed wells are timely capitalized.

14.IA.1.3.1 Depreciation Control Objective Correct computation of depreciation Nature of Work Step Verification / Analysis Risk Impact on financial statements of Company. Nature of Control Manual / Automated

1. Use T-code AR01/AS03 to check whether the rates given in the Schedule XIV of Companies Act have been considered for depreciation.

2. Check whether the depreciation keys have been updated T-Code: SPRO as per latest legislations. (E.g.: Companies Act, 2013).

3. Use T-code AR01 to check if the rates of depreciation applied are justified based on the useful life of asset.

4. Use T-code FBL3N to check depreciation for a sample of assets. 5. To check all cost to bring asset in current form can be checked with ME23N and CJI3 and can be

confirm with capitalize amount from AR01/AS03.

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14.IA.1.3.2 Depreciation Control Objective Disclosure of depreciation policy Nature of Work Step Verification / Analysis Risk Non-compliance to statutory regulation Nature of Control Manual

1. Check if there is any changes in depreciation policy. 2. Check if there is appropriate disclosure of depreciation policy in the notes to accounts.

14.IA.1.3.3 Depreciation Control Objective Review depreciation for low value assets Nature of Work Step Verification / Analysis Risk Non-compliance to accounting policies. Nature of Control Automated

1. Generate a list of assets using AR01/AS03. 2. Review whether assets valuing less than Rs.5000 have been charged off as per the accounting

policy. 3. Review whether 100% depreciation is charged for low value items as defined in the Accounting

policies.

14.IA.1.4 Physical verification of fixed assets Control Objective 1. Physical verification is done on periodic basis as per the company policy

2. Appropriate approvals are in place for the adjustments made Nature of Work Step Verification Risk Incorrect inventory records. Nature of Control Automated / Manual

1. Review whether physical verification policy exists. 2. Check if fixed assets are verified periodically as per the policy. Verify whether policy has been

complied. Review whether tagging of assets is done as per the Fixed Asset Register. 3. Check if the procedure provides for verification of compliance with the warranties and

conditions in the relevant insurance policies. 4. Use T-codes AR01/ AS03 to check if the procedure provides for verification/ confirmation of

fixed assets with the third parties. 5. Check if reports regarding such verification are prepared. 6. Check if damaged/ obsolete items are disclosed by such reports, and removed from the records

and financial accounts with proper authority. 7. Check if discrepancies disclosed by such reports are investigated. 8. Use T-code FBL3N to check if records and financial accounts are corrected with proper

authority. 9. Conduct a sample physical count to check whether the location for assets is updated correctly in

FAR. 10. Ensure that for all inter/intra unit transfer of assets, the FAR is updated timely. Check whether

approvals have been taken as per DOP for transfer of assets. 11. For assets procured for JV, ensure that the assets are accounted appropriately in FAR

14.IA.1.5.1 Disposal of fixed assets Control Objective Adequate controls over disposal of fixed assets Nature of Work Step Analysis / Verification Risk Potential value of fixed asset not realized. Nature of Control Automated / Manual

1. Use T-code SUIM to check whether disposals are approved as per the DOP matrix.

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2. Use T-code VA25 to ensure that quotations are obtained for all fixed assets sold and best quoting customer is selected.

3. Ensure that after approval of disposal whether the asset has been taken out from Asset register. 4. Use T-code AR01 to ensure that WDV of the asset is correctly computed to ensure accuracy of

the profit/ loss accounted. Ensure that approved assets for disposal are stocked in yard properly.

14.IA.1.5.2 Disposal of fixed assets Control Objective Timely condemnation of unserviceable items Nature of Work Step Verification Risk 1. Loss of value of asset.

2. Fund blockage. Nature of Control Manual

1. Conduct a review of offices /plant area, and identify any items which were not timely condemned to Scrap Management Department.

2. Discuss with process owner and discuss any cases where assets are not in use and have not been declared as inactive.

3. Review Fixed Asset Register and cross verify existence of those items in FAR.

14.IA.1.6 Ownership documents Control Objective Safe custody of ownership documents Nature of Work Step Verification Risk Fraudulent use of ownership documents. Nature of Control Manual

1. Check if there is a list of title deeds for land, properties and buildings. 2. Check if title deeds of properties are kept in a safe place. 3. Check if certificates are obtained periodically if they are lodged as security. 4. Check if registration books of vehicles are periodically verified.

14.IA.1.7.1 Accounting policies Control Objective Adherence to accounting policies Nature of Work Step Verification Risk 1. Non compliance to accounting policies.

2. Misstatements in financial statements. Nature of Control Manual

1. Obtain a list of accounting policies pertaining to area. 2. Also take reference from annual report / financial statements. 3. Review compliance of the policies.

14.IA.1.7.2 Accounting policies Control Objective CARO Compliances Nature of Work Step Verification Risk Non compliance to CARO. Nature of Control Manual

1. Check whether the CARO requirements for fixed assets, physical verification, disposal of fixed assets, inventory etc. are being followed and disclosures are made timely as per requirements.

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14.IA.2 Finance & Accounts - Costing

Scope Audit Areas

1 Costing records

2 COGS analysis

3 Variance analysis

4 Reconciliation of costing records with financial records

5 MIS reporting

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14.IA.2.1.1 Costing records Control Objective Adequacy of cost audit Nature of Work Step Analysis / Verification Risk Non compliance of The Companies Act, 2013. Nature of Control Manual

1. Review whether cost audit has been conducted and completed as per the requirements of The Companies Act, 2013.

14.IA.2.1.2 Costing records Control Objective Adequacy of cost audit and records Nature of Work Step Verification/Analysis Risk Non compliance of The Companies Act, 2013. Nature of Control Manual

1. Review whether the cost records have been maintained as per the requirements of Cost Accounting Record (Petroleum Industry) Rules, 2002.

2. Review whether compliance to the Companies (cost records and audit) Rules, 2014 (and any amendments thereon) has been ensured.

3. Review whether the cost records have been maintained as per the requirements of Cost Accounting Records (Telecommunication Industry) Rules, 2011.

4. Review whether the cost records have been maintained as per the requirements of e Cost Accounting Records (Electricity Industry) Rules, 2001.

14.IA.2.1.3 Costing records Control Objective Periodic analysis of cost of goods / services sold Nature of Work Step Verification/Analysis Risk Calculation of incorrect cost. Nature of Control Manual / Automated

1. Use T-code CK13N to check standard costs and examine the basis of arriving at costs as standards. Check whether there has been any change in standard costing and is approved as per DOP.

2. Check the overheads allocation to respective products and to what extent variation in terms of interest on working capital, marketing costs, and promotional costs has been considered in product contribution.

14.IA.2.2 COGS analysis Control Objective TDS compliance Nature of Work Step Verification

Risk Non compliance to TDS regulations. Nature of Control Manual / Automated

1. On a sample basis review whether TDS has been deducted on payments made for services. 2. Review whether TDS deducted is as per prevailing rates.

14.IA.2.3 Variance analysis Control Objective Timely variance analysis Nature of Work Step Analysis / Verification Risk Non-identification of trend of cost movement. Nature of Control Manual / Automated

1. Use T-code KKS2 to review the variance analysis done on periodic basis.

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14.IA.2.4 Reconciliation of costing records with financial records Control Objective Periodic Reconciliation Nature of Work Step Verification Risk Non-reconciliation of costing and financial records. Nature of Control Manual / Automated

1. Use T-code KSB5 to check the periodic reconciliation of costing records with financial records.

14.IA.2.5 MIS Reporting

Control Objective Adequacy of information reported Nature of Work Step Verification / Analysis Risk Unavailability of documented basis for fixing cost. Nature of Control Manual

1. Understand the process followed for preparation of costing MIS. 2. Check whether MIS reports are adequately reviewed before circulation. 3. Check the accuracy and adequacy of information reported in MIS.

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14.IA.3 Finance & Accounts - Payables

Scope Audit Areas

1 Vendor master

2 Matching PO

3 Posting to payables

4 Vendor balances

5 Debit/ Credit notes

6 Legal case by vendors

7 Accounting policies

8 Bank guarantee

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14.IA.3.1 Vendor master Control Objective Review of changes to vendor master Nature of Work Step Verification Risk 1. Incorrect billing to vendors.

2. Non availability of required information. 3. Inability to comply with regulations.

Nature of Control Automated/ Manual 1. Use T-code XK99/XK03 to check if the changes/ updations to vendor master are made on the

basis of approval by management. 2. Use T-codes XK03/S_ALR_87012086 and SE16N to review of vendor master for identification of:

a. Incompleteness in the details entered b. Wrong details captured.

3. Use T-codes XK03 and SE16N to check if more than one account exists for a single vendor on the basis of following criteria: a. Vendor name b. Vendor registered address c. Bank Account number d. PAN/TIN number.

14.IA.3.2 Matching PO Control Objective Terms of PO matching with Invoices Nature of Work Step Verification/Analysis Risk Incorrect payment due to erroneous billing. Nature of Control Manual / Automated

1. Check whether system is configured to restrict direct booking of invoice without PO. (SPRO -> Materials Management -> Logistics Invoice Verification -> Incoming Invoice -> Direct Posting to G/L Accounts and Material Accounts).

2. For instances, use T-code MIR5 to generate list of invoices. Check whether each payment is against a Purchase Order / Service Order. This can be done by verifying mapping of PO number with invoices - vendor ledgers.

3. Check the terms mentioned on Invoices are in confirmation with the PO. 4. Attempt PO creation / release on basis of unapproved PR. 5. Use T-code ME2N/ME5A to check that requisition number has been mentioned on every PO. 6. Use T-code ME2N/ME23N to check that any change in terms of PO has been authorized, and that

rate differences have not been accepted unless adequate reason for same has been provided. Check release strategy.

7. Check the mapping of authorization in ERP for release of payment is to be checked whether it is in line with the DOP. Use T-Code SUIM.

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14.IA.3.3.1 Posting to payables Control Objective Correct application of payments Nature of Work Step Verification/Analysis Risk Payment to wrong vendor. Nature of Control Automated/ Manual

1. Use T-code ME2N to check that posting to payables has only been made after receipt of goods or when goods are in transit and the ownership has been transferred to the Company. Re-perform the three-way match performed by finance team for the sample payments.

2. Verify whether all documents required for payment of the bill have been received before release of payment.

3. Verify that no duplicate payments are made. 4. On a sample basis. Use T-code ME2N to confirm the amount posted in SAP with the invoice

amount (Physical invoice vs. SAP entry). 5. Use T-code FBL1N to check for debit and credit balances appearing for the same vendor because

of duplication of vendor code. 6. Use T-code FBL1N to check that any payment made was not applied against incorrect invoice.

(Sample basis- Physical vs. SAP). 7. Use T-code FBL1N to ensure any amount paid to any vendor was posted in the correct vendor

name by reconciling against balance appearing in SAP.

14.IA.3.3.2 Posting to payables Control Objective TDS compliance Nature of Work Step Verification

Risk Non compliance to TDS regulations. Nature of Control Manual / Automated

1. On a sample basis review whether TDS has been deducted on payments made for services. 2. Review whether TDS deducted is as per prevailing rates.

14.IA.3.4 Vendor balances Control Objective Vendor ageing analysis


Risk Non-recovery of dues

Nature of Control Manual / Automated

1. Check that vendor aging is available with the department. 2. Review on a sample basis, whether correct payment due date is being recorded in SAP, in

accordance with contract terms. 3. Use T-code FBL1N to check for balances which are overdue and take case wise response. 4. Check whether any reconciliation sheet is made and updated regularly. 5. In case of major parties, take second party confirmations for balance pending. 6. Use T-code MB5S to check for controls present in SAP to track invoices which are pending to be

paid.

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14.IA.3.5 Debit/ Credit notes Control Objective Timely monitoring of debit/credit notes

Nature of Work Step Analysis / Verification Risk 1. Non-recovery of dues.

2. Payment of interest due to delayed payment. Nature of Control Manual / Automated

1. Analyze the reasons for raising of debit/credit notes issued to vendors. 2. Use T-code FBL1N to check if these debit notes/ credit notes were duly authorized and

supported by adequate workings and documents.

14.IA.3.6 Legal case by vendor

Control Objective Analysis of legal cases filed by vendors Nature of Work Step Verification Risk 1. Non-recovery of dues.

2. Decreased reputation of Company. Nature of Control Manual

1. Check for any legal case filed by the vendors. 2. Check the steps taken by the Company against such notice or the progress of the suit. 3. Check the reason for stopping the payment and whether adequate provision has been made or

contingent liability has been shown.

14.IA.3.7 Accounting policies Control Objective Adherence to accounting policies Nature of Work Step Verification Risk 1. Non compliance to accounting policies.

2. Misstatements in financial statements. Nature of Control Manual

1. Obtain a list of accounting policies pertaining to area. 2. Also take reference from Annual Report / financial statements. 3. Review compliance of the policies.

14.IA.3.8 Bank guarantee Control Objective Monitoring of Bank Guarantee / Letter of Credits Nature of Work Step Verification Risk Unavailability of recourse against non performing vendor. Nature of Control Manual

1. Obtain Bank Guarantee Register / list of LC. Use T-code ZFIBG. 2. Verify SAP records with manual records. Check accuracy and completeness. 3. Check adequacy/ validity as per the respective contract / Purchase Order/ Work Order. 4. Whether all BG / LC have been verified with respective banks. 5. Whether any expired BG have been kept.

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14.IA.4 Finance & Accounts – Taxation

Scope Audit Areas

1 Checklist of statutory requirements

2 System updates

3 Return filing

4 Tax payments

5 Availing exemptions and taking credits

6 Pending demands and assessments

7 Deferred Tax

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14.IA.4.1 Checklist of statutory requirements Control Objective Comprehensive tax compliances checklist Nature of Work Step Analysis / Verification Risk Delayed/ incorrect tax payment. Nature of Control Automated/ Manual

1. Check whether a checklist is available with the Company regarding all applicable tax compliances.

2. Check whether the list is regularly updated and amended as per the amendment in tax laws. 3. Check if all return dates and tax deposit dates have been recorded in the checklist and complied.

The compliance can be checked on a sample basis. 4. Enquire about the internal team and/or external consultants who ensure timely statutory

compliances. 5. Check that all the taxes have been paid and return filed timely as per relevant applicable tax

laws.

14.IA.4.2 System updates Control Objective Timely updation of tax rates and due dates in ERP Nature of Work Step Verification Risk Delayed/ incorrect tax payment. Nature of Control Automated / Manual

1. Use T-code SE16N to check if correct tax rates have been entered in SAP like prevailing TDS rates, excise duty rate, service tax rate etc.

2. Use T-code FBL3N to check if correct return dates and tax payment dates have been entered in SAP for filing of returns like PF return, ESI return, TDS return etc.

14.IA.4.3 Return Filling Control Objective Timely filing of returns Nature of Work Step Verification/Analysis Risk Interest/ penalty charges for delay. Nature of Control Automated/ Manual

1. Use T-code J1INMIS to check for any delay in filing of returns resulting in imposition of penalties. 2. Check the control measures taken by tax team to avoid any delay in filing of returns.

14.IA.4.4 Tax payments Control Objective Timely payment of tax Nature of Work Step Analysis / Verification

Risk Interest/ penalty charges for delay. Nature of Control Manual / Automated

1. Use T-code J1INMIS to check the tax deposit challans and note any delays in depositing the same.

2. Use T-code FBL3N to check the total interest or penalty paid by Company due to late deposit of tax.

3. Check what measures have been taken by Company to avoid any delay in payment of tax.

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14.IA.4.5 Availing exemptions, taking credits Control Objective Adequate control over exemptions and tax credits Nature of Work Step Analysis / Verification

Risk Excess tax payment.

Nature of Control Automated / Manual 1. Check which tax exemptions are available for the Company. 2. Check whether all exemptions have been availed by the company like excise duty and custom

duty exemptions. 3. Use T-code FBl3N to ensure that credit has been taken against all duty paid. 4. Verify that appropriate deductions U/S 80-IA & 80-IB of Income Tax Act has been taken by the

company.

14.IA.4.6.1 Pending demands and assessments Control Objective Monitoring of demands and tax assessments

Nature of Work Step Analysis / Verification Risk Possibility of legal action against Company. Nature of Control Manual

1. Examine all pending demands and assessments initiated against the company by the tax department.

2. Check the actions taken by the Company against such assessments.

14.IA.4.6.2 Pending demands and assessments Control Objective Scrutiny of Income Tax Notices, if any Nature of Work Step Verification Risk Financial Risk with Penalty. Nature of Control Manual

1. Check whether the Company has a mechanism to ensure that all Income Tax notices received are stored in a central location (scanned document in shared folder with limited access) and recording is done in a file mentioning the date on which the notice was received, status and action taken.

2. Check whether the Company has any open Income Tax notices. Ensure that the same are reported to the requisite authority periodically with the status.

14.IA.4.7 Deferred tax Control Objective Treatment for timing difference Nature of Work Step Verification / Analysis Risk Incorrect accounting. Nature of Control Automated/Manual

1. Check whether timing differences have been correctly differentiated into temporary and permanent timing difference.

2. Check whether correct treatment as per AS 22 has been done.

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14.IA.5 Finance & Accounts – Treasury

Scope Audit Areas

1 Working capital management

2 Treasury Policy/Guidelines

3 Borrowings

4 RBI Guidelines

5 Hedging

6 Interest & finance charges

7 MIS

8 Investment of surplus fund

9 Bank guarantees(BGs) and Letter of Credits(LCs)

10 Control over cash

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14.IA.5.1.1 Working capital management Control Objective Adequate working capital management Nature of Work Step Analysis / Verification Risk Inadequate working capital. Nature of Control Automated/ Manual

1. Use T-code FBL3N, FF7A and FF7B - Cash Position to check if cash flow requirements are evaluated on an ongoing basis.

2. Use T-code FF7A and FF7B - Cash Position to check if the budgeted funds flow and cash flow is prepared to ensure adequate funds and effective utilization of funds.

3. Check if various indicators to monitor adequate working capital are defined and monitored (e.g. NP ratio, CA ratio, Debtor/ Creditor turnover ratio).

4. Identify slow moving/ non moving and areas of blockage of funds and see if adequate action is taken by management over such cases.

5. Check if cost-benefit analysis is carried out for deciding proportion between domestic / foreign currency and long term / short term borrowings.

14.IA.5.1.2 Working capital management Control Objective Opening, monitoring and closing of bank accounts Nature of Work Step Verification/Analysis Risk 1. Unauthorized opening and closing of bank accounts.

2. Cash Operations Nature of Control Manual

1. Obtain the list of bank accounts opened and closed during the audit period. 2. Identify the reasons for opening and closure of the bank accounts. 3. Check whether any new account opening was done with due approvals. 4. Check whether account closure (if any) has been duly authorized. 5. Check Idle cash balance in hand (No. of days cash hold Vis a Vis average expenses and maximum

expense per month). 6. Check whether cash payments/ withdrawals were duly approved. 7. Check appropriateness of payments made in cash. Check if the same could be availed through

credit. 8. Perform surprise physical cash verification. 9. Check if any process exist for physical verification and surprise physical verification. 10. Check process of cash hand over. 11. Check controls over keys handover and in hands 12. Check whether cash balance has exceeded the amount of cash Insurance policy. 13. On sample basis, verify the reconciliation for cash collection during the day and deposited to

bank.

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14.IA.5.1.3 Working capital management Control Objective Bank Reconciliation Statements Nature of Work Step Verification/Analysis Risk 1. Reconciled balance in bank account may lead to fraudulent bank

transactions. 2. Non monitoring of bank transactions leading to duplicate payments to vendors.

Nature of Control Automated/ Manual 1. Obtain the list of Bank accounts (both operative and inoperative). 2. Check for sample months, whether the BRS is prepared timely and is authenticated as per DOP. 3. Check the Inter – bank transfer of funds with the relevant supporting's / advices. 4. Ensure that the stale cheques outstanding in the Bank Reconciliation transferred to Stale

Cheques Account. Check in the bank statement if there is any debit for stale cheques. Check whether any non CTS stationery is being kept.

5. Obtain the balance confirmation/statement from the bank for the selected month of verification. 6. For long outstanding reconciling items, review the reasons thereof and check for subsequent

clearance. 7. Check if there are cheques collected not cleared by bank for beyond 3-4 days. 8. Check whether adjustment entries are passed timely and accurately. 9. Perform bank reconciliation for latest month and reconcile with BRS prepared by the process

owner.

14.IA.5.1.4 Working capital management Control Objective Banking Controls Nature of Work Step Analysis / Verification

Risk 1. Financial loss on the idle funds. 2. Inadequate maintenance of cheque stationery 3. Fund transfer not duly authorized

Nature of Control Manual / Automated 1. Identify non operative bank accounts from Trial Balance and Bank statements. 2. Check policies and documentation related to closing of dormant bank accounts. 3. Verify whether non operative bank accounts were dealt as per the policy. 4. Check whether there are any unutilized funds lying in the bank accounts and the same are not

being transferred to the interest bearing accounts. 5. Verify controls of the company for safeguarding and preventing the misuse of cheque stationary. 6. Review whether fund transfers are duly authorized as per DOP. 7. Scrutinize ledgers/ bank statements and analyze whether payment has been made in parts to

the same party on the same day so as to avoid DOP.

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14.IA.5.1.5 Working capital management Control Objective Interest & Finance Charges


Risk 1. Incorrect computation of interest. 2. Delay in accounting of interest accrued. 3. Loss of interest due to idle funds.


1. Check whether the charges levied by banks are adequately supported by documents. 2. Check whether interest has been accounted timely. 3. Check whether interest has been computed correctly. 4. Ensure periodic forecast is done pertaining to funds requirement and ensure that minimum cash

credit limit is utilized.

14.IA.5.1.6 Working capital management Control Objective Annual Rating Exercise

Nature of Work Step Analysis / Verification Risk Delay/Degradation in credit rating may lead to loss of Company's credit

worthiness. Nature of Control Manual

1. Understand the process of credit rating exercise. 2. Ensure that credit rating has been acquired from authorized agencies timely.

14.IA.5.2 Treasury Policy / Guidelines

Control Objective Treasury exposure is adequately monitored Nature of Work Step Analysis / Verification Risk Excessive treasury exposure. Nature of Control Automated / Automated

1. Check if a policy has been defined for mitigating treasury exposure. 2. Check that compliance with Treasury Policy is ensured. 3. Use T-code TBLB to check if limits have been defined for taking exposure in different types of

borrowings. If not available in SAP, obtain manual documents.

14.IA.5.3.1 Borrowings Control Objective Borrowings are within the authorized limits Nature of Work Step Verification Risk Unauthorized borrowings. Nature of Control Automated/Manual

1. Use T-code F.01 / TBLB to check that borrowings have been made within the borrowing power defined by the management.

2. Use T-code TM_53 or TM03 to check if borrowings are duly authorized as per DOA and Company Law requirements.

3. If not available in SAP, obtain manual documents.

14.IA.5.3.2 Borrowings Control Objective Monitoring of long terms and short term borrowing costs Nature of Work Step Analysis / Verification Risk Variance in borrowing costs. Nature of Control Automated / Manual

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1. Use T-code F.01 to obtain list of borrowings. 2. TPM13 to check if the effective cost of borrowing including one time charges, fees etc. is

reported to the management for each long term and short term facility. Also perform comparison of effective cost versus budgeted cost.

14.IA.5.3.3 Borrowings Control Objective Timely repayment of borrowings Nature of Work Step Verification Risk Penalty/ interest charges upon delay of repayments.

Nature of Control Manual / Automated 1. Use T-code F.01 to obtain list of borrowings. 2. TPM13 or SE16N or S_ALR_87015205 to check if repayments have been made as per schedule

and are in compliance to the terms of borrowings.

14.IA.5.4 RBI Guidelines Control Objective Compliance with RBI Guidelines for ECBs and other foreign currency loans Nature of Work Step Verification Risk Penalty/ charges upon non-compliance with RBI guidelines.

Nature of Control Manual / Automated 1. Check that company has a checklist of guidelines issued by RBI which relates to the Company. 2. Ensure that checklist is periodically reviewed and updated. 3. Ensure compliance with all applicable RBI guidelines.

14.IA.5.5 Hedging Control Objective Forward Covers Nature of Work Step Verification Risk Non-compliance with Company Policy.

Nature of Control Manual / Automated 1. Check the compliance with Forex and Interest Rate Risk Management policy. 2. Use T-codes TX03, 06 and TPM12 to check if the Company has taken forward the contract to

hedge exchange rate risk. 3. Obtain the list of forward covers taken during the period and check whether forward covers are

taken are in line with the company policy or not.

14.IA.5.6 Interest & finance charges Control Objective Adequate monitoring of interest and finance charges Nature of Work Step Verification / Analysis Risk Over-payment of interest and finance charges.

Nature of Control Manual / Automated 1. Check whether the charges levied by banks were adequately reviewed and compared with

calculations. Ensure that the short term borrowings are repaid as per schedule with interest 2. Use T-codes SE16N and TPM13/FBL3N to check whether interest was accounted timely. 3. Check whether there are any unutilized funds lying in the bank accounts and the same are not

being transferred to the interest bearing accounts and check whether forward covers are taken are in line with the company policy or not.

14.IA.5.7 MIS Control Objective Completeness and accuracy of MIS Nature of Work Step Verification

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Risk 1. Incomplete MIS. 2. Inaccurate MIS.

Nature of Control Manual 1. Check whether MIS format has been defined. 2. Check compliance with Foreign Exchange Risk Management Policy. 3. Check if the MIS has been prepared correctly with complete details. 4. Check whether any material information has been left out from MIS format.

14.IA.5.8.1 Investment of surplus fund Control Objective Monitoring of investment Nature of Work Step Verification Risk Ineffective utilization of investments.

Nature of Control Manual 1. To ensure that investment records are accurately maintained in investment register & SAP. 2. To ensure that Renewal/ extension/ enhancement of Cash Credit and other credit facilities is

duly authorized. 3. To ensure that short term surplus funds of the company are invested in accordance with the

guidelines 4. Ensure that investments are re-analyzed at periodic intervals to decide whether investments

should still be held or sold off. (On the basis of returns generated and current market scenario). 5. Obtain a list of investments, and check whether there are any overdue investments. 6. In case of matured investment, check whether full amount has been received and accounted

for.

14.IA.5.8.2 Investment of surplus fund Control Objective Investment in FDRs with proper authorizations Nature of Work Step Verification Risk Unauthorized investments in FDRs.

Nature of Control Manual / Automated 1. Check whether investments in FDRs have been made as per investment policy and procedure

approved by the Board read with DPE (Department of Public Enterprises) guidelines. 2. Use T-code TPM13 to obtain list of investments made in FDRs and check whether proper

approval was obtained before making investments. 3. Also perform physical verification of term deposits (FDR)/ bonds / other receipts. 4. Review adequacy of physical controls over receipts/ notes/ bonds.

14.IA.5.8.3 Investment of surplus fund Control Objective Investment in mutual funds with proper authorizations Nature of Work Step Verification / Analysis Risk Unauthorized investments in mutual funds.

Nature of Control Manual / Automated 1. Use T-code TS01 to check whether investments in mutual funds have been made as per

investment policy / DPE guidelines. 2. Check the basis of investment decision in a particular mutual fund. 3. Check whether there are mutual funds providing higher return but not considered by the

Company, obtain reasoning for same.

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14.IA.5.8.4 Investment of surplus fund Control Objective Interest and dividend receivable Nature of Work Step Verification / Analysis Risk Loss of income.

Nature of Control Manual / Automated 1. Whether timely and accurate accounting of income is done. 2. Whether income is received on a timely basis. 3. Review on a sample basis whether the interest received is accurately calculated. 4. Use FBL3N for GL review. Check whether income as well as tax deducted thereon have been

duly accounted in SAP.

14.IA.5.9 Bank guarantees(BGs) and Letter of Credits(LCs) Control Objective Periodic monitoring of Bank Guarantees and LCs Nature of Work Step Verification / Analysis Risk Non-adherence to terms of Bank Guarantees and LCs, and possible legal

action. Nature of Control Manual / Automated

1. Check that all Bank Guarantees and Letter of Credit(s) are closed within the timeframe defined or on completion of transaction.

2. Check the rate of BG's and LCs as per the associated contracts. 3. Use T-code TM_60 to check if non-fund limit is tracked so as to ensure effective utilization of

available limits. 4. Check whether the BG's are encashed only by the authorised personnel.

14.IA.5.10 Control over cash Control Objective Control over cash Nature of Work Step Verification / Analysis Risk 1. Inadequate control over cash.

2. Fraudulent use of cash Nature of Control Manual

1. Evaluate the controls prescribed by management over cash. 2. Check whether adequate cash insurance policy has been taken. 3. Ensure that unnecessary premium for cash policy is not being paid. 4. Check if the Company has lodged refund claim with the insurance company in case it was not

able to utilize the entire policy amount, and if the claim has been filed within reasonable time of completion of policy period.

5. Check whether cash available on any day exceeds the insured amount. 6. Perform a surprise physical verification of cash and compare with the ledger amount. 7. Review whether process for periodic physical verification of cash exists and implemented. Check

records for same. 8. Review whether cash maintained exceeds prescribed limits.

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14.IA.6 Finance & Accounts – Financial Planning & Analysis

Scope Audit Areas

1 Budget preparation

2 Measuring the actuals

3 Comparison with the budget

4 Comparison with last year

5 Interim comparisons

6 Control steps taken

7 PR tracking


9 Manpower planning

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14.IA.6.1 Budget preparation Control Objective Adequate budget planning Nature of Work Step Analysis / Verification Risk Excess CAPEX and OPEX expenditure. Nature of Control Automated/ Manual

1. Check that budget was prepared as per the defined timelines. 2. Check that current annual plan along with five year plan is available with the management. 3. Check the basis of budget and analyze its reasonableness and compare the same with previous

years' budget. 4. To check the assumptions and basis used to define the budget. 5. To check whether all the departments have been submitted to budget as per the format and

within the timeframe. 6. To check all documents related to budget and assumptions are available and documented

properly. 7. Use T-code S_ALR_87013558 to check that CAPEX and OPEX have been separately defined in the

budget. 8. Verify periodic review of budget utilization is done. 9. Verify re-appropriation of funds is authorized. 10. Verify whether budgets are fully utilized and non utilisation of budget are monitored and

reported. 11. If, budgets are utilized on pro-rata basis then the same is properly monitored. 12. Verify that timely concurrence is provided by appropriate finance authority for sanction of

expenditure.

14.IA.6.2 Measuring the actuals Control Objective Ensure the correctness of actual expenses Nature of Work Step Verification/Analysis Risk Incorrect accounting of expenditure. Nature of Control Automated / Manual

1. Use T-code CJI3 to check the actual spending in terms of CAPEX and OPEX. 2. Use T-code KSB5 to check that expenses have been correctly classified as revenue expenses or

capital expenses. Alternatively, GL review for OPEX / review of purchase orders using ME2N can be done, and detailed review may be done on a sample basis.

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14.IA.6.3 Comparison with the budget Control Objective Comparing Actual v/s the budget and analyzing the reason for differences Nature of Work Step Verification/Analysis Risk Non-adherence to budget. Nature of Control Automated/ Manual

1. Use T-code S_ALR_87013558 to compare the budgets with actual expenses and analyze the reason for deviations, if any.

2. Check whether the deviation was avoidable or unavoidable e.g. due to change in government policy which is an unavoidable deviation.

3. Check the steps taken by management to curb the deviation and its reasonableness. In case of any new expenditure which is not planned, use T-code CJ31 to check whether proper authorization from management was taken before incurring the same.

4. Check whether each department is aware of its allocated budgets and is complying with the same.

5. Check that the budget is communicated to each department on regular intervals and that any deviation in the budget is communicated on time.

6. Check whether any deviations are duly approved as per DOP.

14.IA.6.4 Comparison with last year Control Objective Comparing Actual v/s the last year figures and analyzing the reason for

differences. Nature of Work Step Analysis / Verification

Risk Non-identification of trend of expenditure. Nature of Control Automated / Manual

1. Use T-code S_ALR_87013545 to check the current year actual figures with last year's figures.c. A list of parked documents, if any will be displayed.

2. Use T-code S_ALR_87013545 to check current year expenses ratio and compare the same with last year. Analyze the reasons for major changes.

3. Use T-code S_ALR_87013532 to check whether management is doing cost-benefit analysis before making CAPEX expenditure.

14.IA.6.5Interim comparisons Control Objective Comparing actual during a year and revising the budgets.


Risk Non-adherence to budget.


1. Use T-code S_ALR_87013557 to check whether management is doing interim comparisons and revising the budgets if required.

2. Check whether budget revisions are reasonable and in line with companies policies. 3. Check whether the reports on Austerity Measures as per Govt./Ministry Circular are being published and put up to higher management on regular interval.

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14.IA.6.6.1 Control steps taken Control Objective Reasonability of control steps and output achieved with the revision

Nature of Work Step Analysis / Verification Risk Non-adherence to budget. Nature of Control Automated / Manual

1. Use T-code S_ALR_87013558 to check the deviation from budget. 2. Check what steps have been taken to control the deviations and also check their

reasonableness. 3. Check the actuals and check whether the management has been able to control the deviations. 4. Check what plans the management has in place in case deviations still exist.

14.IA.6.6.2 Control steps taken

Control Objective SAP control over expenses budget accounting principles Nature of Work Step Verification

Risk Inability to control excess PR /PO. Nature of Control Automated

1. Review whether budget is linked with Purchase Requisition / Purchase Order.

14.IA.6.7 Creation of Service Entry Sheet (SES) Control Objective Exploiting the best option available Nature of Work Step Analysis / Verification Risk 1. Delays in payments.









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14.IA.6.8 PR Tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Analysis / Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /






14.IA.6.9 Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Analysis / Verification Risk 1. Over/Under-utilization of manpower.




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14.IA.7 Finance & Accounts – JV Operated

Scope Audit Areas

1 JV contract

2 PSC and JOA compliance

3 Revenue sharing

4 Cash calls


6 Recording of expenses and accounting

7 Insurance

8 Cost allocation

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162

14.IA.7.1 JV contract Control Objective Guidelines specified, reasonable conditions. Nature of Work Step Analysis / Verification Risk Possibility of legal action against Company. Nature of Control Manual

1. Check that a contract has been made and all terms and conditions have been clearly specified and no important condition has been missed.

2. Check whether legal vetting has been done. 3. Check whether any MOU or Joint Bidding Agreement(JBA) has been signed between the partners

before bidding and if so, whether all the conditions have been clearly spelt out. 4. Check that major operating rights are with the company like making calls. 5. Ensure all conditions are reasonable and not adverse to the company. 6. Check whether any time has been specified for which JV has been entered. If yes, then if the

period has exceeded then, any new contract has been entered or not.

14.IA.7.2.1 PSC and JOA compliance Control Objective To review the compliance of:

a) Production Sharing Contracts (PSC) b)Joint Operating Agreement (JOA) and draw out the salient features and conditions that the operator needs to comply with c) Any other agreements between partners

Nature of Work Step Analysis Risk Non compliance to PSC and JOA by the Operator may lead to:

a. Disqualification of JV b. Heavy penalty/ Liquidated Damages(LD) to JV c. Cancelation of exploration license by Govt.

Nature of Control Manual 1. Check whether a detail list of compliances under PSC, JOA or any other agreement is available:

Compliance will include following: a. Requirements of the operating / Management committee b. Approvals in budgeting process c. Compliance to reporting to DGH & JV partners d. Basis of computation of various reporting's to DGH & JV partners e. Measurement of Petroleum f. Recovery of cost for Oil and Gas g. Production sharing of Oil and Gas h. Valuation of petroleum i. Assignment of interest j. Payment of fee to Government k. Bank Guarantee submission (Basis & Timely submission) l. Cost allocation basis m. Approvals thereof

2. Compliance to JOA / PSC accounting procedures a. Government / License and assistance b. Certificates and notices

3. Cash call periodicity 4. Submission of bill statement by timeline. 5. Check whether compliance checklist were prepared by process owner, and verify compliances.

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6. Check frequency of operating committee meeting. 7. Compare with the physical documents maintained.

14.IA.7.2.2 PSC and JOA compliance Control Objective To verify that the management committee and the operating committee

approves/reviews all the joint venture related issues and documents Nature of Work Step Analysis Risk Non compliance to internal policies/ Audit Exceptions by Other partners/ Govt

Auditors may lead to disputes Nature of Control Manual

1. Verify procedure around approval and review of following by Operating and Management committee: a. Minimum work program b. Annual budget c. Revision of budget d. Authorization for Financial Expenditure (AFE)/ Authorized Expenditure Request e. Progress of the work f. Cash call g. Costing basis h. Preparation & Circulation of MIS.

14.IA.7.2.3 PSC and JOA compliance Control Objective To verify whether the operator functions in a good operational and financial

probity. Nature of Work Step Analysis and Verification Risk Inadequate financial and operation probity may lead to financial

misstatement. Nature of Control Manual

1. Review the following: a. Recoverability of debts b. Movement of Inventory c. Working capital management d. Funds management e. Procedure for cash calls f. Analysis of cash calls as against approved work program g. Escrow account maintained for the work program (if applicable) h. Deployment of cash call received i. Application of time writing rates j. Time writing and allocation policies, rates, revision of rates and time writing of other Non JV

activities and their allocation if any k. Procedures for monthly accounts closure. l. Contracts and materials m. Procedure for arriving at the Value of Work Done n. Well cost reconciliation, if wells drilled o. Payment of duties, taxes, cess and other statutory payments on time p. Engineering, Procurement, Installation and Commissioning reconciliation q. Structuring of contracts r. Application of contractual rates in invoice payments s. Commitment reporting

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t. Replies to DGH, Government audits and other Audits including CAG21 accounting structure.

2. Prepare a detailed process flow on each of the above and examine the compliance to the SOP, if in existence.

3. In cases of control weakness observed, report the issues with its perceived impact on the cost recovery and its financial / operational impact.

4. Verify whether the management has an established internal control structure and a procedure for financial reporting.

5. Document and report in cases of anomalies observed.

14.IA.7.3.1 Revenue sharing Control Objective Sharing revenue and costs Nature of Work Step Verification

Risk Non-realization of potential revenue Nature of Control Automated / Manual

1. Use T-code GJ_GD13 to ensure that all revenue is shared according to the contract. 2. Use T-codes GJ98 and GJ95 to check that costs are also being shared in agreed ratio. 3. Ensure that all expenditure are supported with adequate evidence or supporting. Use T-code

CV04 to generate list and CV03N to display individual document. 4. Look for any non compliance in any terms of Joint Operating Agreement (JOA) / Project Sharing

Contract (PSC).

14.IA.7.4 Cash Calls Control Objective Control on making calls, instant reminders and time limit for receiving calls Nature of Work Step Verification / Analysis Risk Delay in operations. Nature of Control Manual/ Automated

1. Use T-codes GJ01, GJ02, GJ05 and GJ06 to check the controls available for making calls on time and its treatment.

2. Check whether any reminder is available or the process of tracking the due calls. 3. Use T-codes GJ01, GJ02, GJ05 and GJ06 to check records for any default made by the JV partner

in paying the cash calls. 4. Use T-code GJRCN to check the reconciliation sheet and verify it is updated regularly and kept

up to date.

14.IA.7.5 Budget preparation Control Objective Making budgets, incurring expenses on basis of budgets, opening expense

heads Nature of Work Step Verification / Analysis Risk Unbudgeted expenses leading to cost overruns. Nature of Control Manual/ Automated

1. Use T-code CJ03 / CJ31 to check that budget is available before starting any project. 2. Use T-code CJ03 / CJ31 to ensure all expenses incurred are in confirmation with the budget

prepared and are pre-planned. 3. Check that control is available which restricts any new expense to be booked which is not

defined in the budget. 4. Use T-code CJ03 / CJ31 to check that any deviation from the budget is highlighted and recorded.

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14.IA.7.6.1 Recording of expenses and accounting Control Objective Separate accounting, ensuring accuracy Nature of Work Step Verification Risk Non-realization of potential revenue/ incorrect accounting leading to future

disputes. Nature of Control Manual/ Automated

1. Use T-code GJ_GD13 / GD20 to check if separate accounting and financial books are maintained for joint ventures as per the Accounting Procedure of PSC and JOA.

2. Use T-codes CJ03 / CJ31 to ensure that each expense recorded relates to the current year only. 3. To obtain line items wise JVA and JV billing totals and verify the accounting documents posted in

the SAP system and check that all costs are appropriately accounted for. 4. To make a review of the financial statements for accuracy and appropriateness especially with

regard to the items not cost recoverable, payment of duties (if any) Forex gains/losses, acquisition of assets/ Main Office Overhead/ PCO and other charges and their applicability.

14.IA.7.6.2 Recording of expenses and accounting Control Objective FOREX revaluations Nature of Work Step Verification Risk Inaccurate valuation of forex may lead to financial mis-statement. Nature of Control Manual

1. Check whether periodic FOREX revaluation of liabilities and assets activity is carried out and the rates used are as specified in the JOA.

2. Obtain list of assets and liabilities for which Forex revaluation has been done. 3. Verify whether the rates have been charged appropriately or not. 4. Also review in line with Accounting Standard 11 (ICAI).

14.IA.7.7 Insurance Control Objective Insurance Coverage Nature of Work Step Verification Risk Inadequate insurance coverage. Nature of Control Automated / Manual

1. Check the insurance chapter of PSC and list out the requirements. Ensure compliance of the same.

14.IA.7.8 Cost Allocation Control Objective Correct cost allocation, inability to achieve MWP Nature of Work Step Analysis / Verification Risk 1. Over / under statement of expenditure.

2. Risk of under cost recovery Nature of Control Automated / Manual

1. Review whether cost allocation has been done as per the PSC. 2. Review whether basis of allocation and working thereof is available. 3. Obtain GJ_GD20 for line items wise JVA and JV billing totals with the accounting document

number. 4. Verify the accounting documents posted in the system and check that all costs are appropriately

accounted for. 5. Compare it with the monthly Joint Interest Billings and with the DGH correspondence. 6. Document and report on anomalies observed in reporting and compliance. 7. Check appropriate cost recovery / depreciation made in ledger.

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14.IA.8 Finance & Accounts – JV Non Operated

Scope Audit Areas

1 JV contract

2 PSC and JOA compliance

3 Revenue sharing

4 Periodic audit


6 Recording of expenses and accounting

7 Agreement terms

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167

14.IA.8.1 JV contract Control Objective Guidelines specified, reasonable conditions. Nature of Work Step Analysis / Verification Risk Possibility of legal action against Company. Nature of Control Manual

1. Check that a contract has been made and all terms and conditions have been clearly specified and no important condition has been missed.

2. Check whether any MOU or Joint Bidding Agreement(JBA) has been signed between the partners before bidding and if so, whether all the conditions have been clearly spelt out.

3. Ensure all conditions are reasonable and not adverse to the company. 4. Check whether any time has been specified for which JV has been entered. If yes, then if the

period has exceeded then, any new contract has been entered or not.

14.IA.8.2.1 PSC and JOA compliance Control Objective To review the compliance of:

a) Production Sharing Contracts (PSC) b)Joint Operating Agreement (JOA) and draw out the salient features and conditions that the operator needs to comply with c) Any other agreements between Operator and other partners including any Farm-in/ Farm-out agreements effecting OIL

Nature of Work Step Verification/Analysis Risk Non compliance to PSC and JOA by the Operator may lead to:

a. Dis qualification of JV b. Heavy penalty/ Liquidated Damages(LD) to JV c. Cancelation of exploration license by Govt.

Nature of Control Manual 1. Prepare detail list of compliances under PSC, JOA or any other agreement:

Compliance of if they will include following: a. Requirements of the operating / Management committee b. Approvals in budgeting process c. Compliance to reporting to DGH & JV partners d. Basis of computation of various reporting's to DGH & JV partners e. Measurement of Petroleum f. Recovery of cost for Oil and Gas g. Production sharing of Oil and Gas h. Valuation of petroleum i. Assignment of interest j. Payment of fee to Government k. Bank Guarantee submission (Basis & Timely submission) l. Cost allocation basis m. Approvals thereof

2. Compliance to JOA / PSC accounting procedures a. Government / License and assistance b. Certificates and notices

3. Obtain details of the Joint Operating Agreements 4. Compare with the physical documents maintained. 5. Document and report on anomalies observed in reporting and compliance.

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14.IA.8.2.2 PSC and JOA compliance Control Objective To verify whether the operator functions in a good operational and financial

probity. Nature of Work Step Analysis and Verification Risk Inadequate financial and operation probity may lead to financial


1. Review the following: a. Recoverability of debts b. Movement of Inventory c. Working capital management d. Funds management e. Procedure for cash calls f. Analysis of cash calls as against approved work program g. Escrow account maintained for the work program (if applicable) h. Deployment of cash call received i. Application of time writing rates j. Time writing and allocation policies, rates, revision of rates and time writing of other Non JV

activities and their allocation if any k. Procedures for monthly accounts closure. l. Contracts and materials m. Procedure for arriving at the Value of Work Done n. Well cost reconciliation, if wells drilled o. Payment of duties, taxes, cess and other statutory payments on time p. Engineering, Procurement, Installation and Commissioning reconciliation q. Structuring of contracts r. Application of contractual rates in invoice payments s. Commitment reporting

2. Replies to DGH, Government audits and other Audits including CAG21 accounting structure 3. Prepare a detailed process flow on each of the above and examine the compliance to the SOP, if

in existence. 4. In cases of control weakness observed, report the issues with its perceived impact on the cost

recovery and its financial / operational impact. 5. Verify whether the management has an established internal control structure and a procedure

for financial reporting. 6. Document and report in cases of anomalies observed.

14.IA.8.3.1 Revenue sharing Control Objective Sharing revenue and costs Nature of Work Step Verification

Risk Non-realization of potential revenue Nature of Control Automated / Manual

1. Check that the invoice is being raised by the operator correctly. Ensure that all revenue is shared according to the contract.

2. Check that costs are also being shared in agreed ratio. 3. Ensure that all expenditure are supported with adequate evidence or supporting. 4. Look for any non compliance in any terms of Joint Operating Agreement (JOA) / Project Sharing

Contract (PSC). 5. Check whether the payment is being made timely and accurately.

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14.IA.8.3.2 Revenue Sharing Control Objective To verify that the cash calls made by the operator are duly supported and the

amounts advanced are compared at the end of the year Nature of Work Step Verification

Risk Excess payment/ short recovery of expenses


1. Obtain the cash calls raised in the JV and cash calls which are settled against the bank receipts documents.

2. Verify the amounts for which the cash calls were raised. 3. Verify that all supporting documents are appropriately maintained. 4. Verify whether previous cash call is reconciled prior to release of next cash call. 5. Document and report on anomalies observed in reporting and compliance

14.IA.8.4 Periodic audit Control Objective Deciding time for audits, documenting audit results Nature of Work Step Verification Risk Inability to track operations of operator. Nature of Control Manual/ Automated

1. Use T-codes GJJ1 and GJJ2 to check whether periodic audits are being conducted. 2. Use T-codes GJJ1 and GJJ2 to check whether audit results have been documented and discussed

with the JV partner. 3. Use T-codes GJ05 and GJ06 to ensure calls are being made as per the contract made earlier. 4. Use T-codes GJ_GD13 to check the reconciliation sheet and verify it is updated regularly and

kept up to date.

14.IA.8.5 Budget preparation Control Objective Making budgets, incurring expenses on basis of budgets, opening expense

heads Nature of Work Step Verification / Analysis Risk Unbudgeted expenses leading to cost overruns. Nature of Control Manual/ Automated

1. Use T-code CJ03 / CJ31 to check that budget is available before starting any project. 2. Use T-code CJ03 / CJ31 to ensure all expenses incurred are in confirmation with the budget

prepared and are pre-planned. 3. Check that control is available which restricts any new expense to be booked which is not

defined in the budget. 4. Use T-code CJ03 / CJ31 to check that any deviation from the budget is highlighted and recorded.

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14.IA.8.6.1 Recording of expenses and accounting Control Objective Separate accounting, ensuring accuracy Nature of Work Step Verification Risk Non-realization of potential revenue/ incorrect accounting leading to future

disputes. Nature of Control Manual/ Automated

1. Use T-code GJ_GD13 / GD20 to check if separate accounting and financial books are maintained for joint ventures as per the Accounting Procedure of PSC and JOA.

2. Use T-codes CJ03 / CJ31 to ensure that each expense recorded relates to the current year only. 3. To obtain line items wise JVA and JV billing totals and verify the accounting documents posted in

the SAP system and check that all costs are appropriately accounted for. 4. To make a review of the financial statements for accuracy and appropriateness especially with

regard to the items not cost recoverable, payment of duties (if any) Forex gains/losses, acquisition of assets/ Main Office Overhead/ PCO and other charges and their applicability.

14.IA.8.6.2 Recording of expenses and accounting Control Objective To verify that the financial statements of the Joint Venture have been audited

regularly by the audit firm defined in the PSC/JOA. Nature of Work Step Verification Risk Risk of misstatement in financial statements Nature of Control Manual

1. Obtain process of appointment of auditor and whether the same has been followed. 2. Take audited reports and check the same with PSC and JOA figures

14.IA.8.6.3 Recording of expenses and accounting Control Objective To verify whether the operator has obtained adequate Insurance coverage. Nature of Work Step Verification Risk Inadequate cover against risk for assets Nature of Control Manual

1. Check the Insurance chapter of the PSC and detail out the requirements to be met by the operator.

2. Check item by item compliance for the insurance coverage and report on the under / over / co/ non insurance.

14.IA.8.7 Agreement terms Control Objective Conditions mentioned in Agreement terms. Nature of Work Step Analysis / Verification Risk Inability to track operations of operator. Nature of Control Automated / Manual

1. Use T-code GJFARM_0 to check if farm-in and farm-out agreement is followed. 2. Use T-codes CV03N and GJT6 to check whether expenses have been annexed with adequate

supporting. 3. Ensure that the Company has not lost all control over non-operating blocks.

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14.IA.9 Finance & Accounts – Financial Reporting

Scope Audit Areas

1 Adherence to laid down procedures

2 Intermediary account balances

3 JV/NELP accounting

4 Access rights

5 Non routine activities

6 Report and ledger review

Audit Checklist

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14.IA.9.1 Adherence to laid procedures Control Objective Adherence to laid down procedures Nature of Work Step Verification Risk Incorrect financial statements. Nature of Control Manual

1. Whether process of financial closing and reporting has been documented and periodically updated.

2. Review the process for financial closing in line with documented procedures. 3. Note down any delays in complying with schedule and check the reasons for the same.

14.IA.9.2.1 Intermediary account balances Control Objective All transitory IUT heads (Account heads) are nullified Nature of Work Step Verification/Analysis Risk Inaccurate accounting of treatment may lead to financial misstatement. Nature of Control Manual

1. Execute transaction code FS10N a. Select GL codes of all IUT accounts. b. Execute the report.

2. Check whether any account shows a balance. In case there is a balance, then the same needs to be nullified before account closures.

14.IA.9.2.2 Intermediary account balances Control Objective To verify whether balances in the Clearing accounts are cleared on a timely

basis. Nature of Work Step Verification/Analysis Risk Non clearing of balances from clearing accounts may lead to inaccurate

financial reporting. Nature of Control Automated/ Manual

1. Obtain the GL Account (Open Item Managed Accounts) balances for clearing account from system using transaction code: S_ALR_87012277 or F.08 a. Enter Chart of Account b. Enter Company Code c. Enter GL Accounts d. Enter Fiscal Year e. Enter Reporting period f. Select Field status group from Dynamic selection and select the relevant clearing field status

variant. Check whether trainer’s past feedbacks are considered before reappointment of any trainer.

2. Verify whether the balances in such clearing accounts are cleared on a timely basis.

3. Obtain reasons for abnormalities, if any, and report the same. 4. In case of GR/IR & SR/IR, check whether MR11 is executed and balances are transferred to the

respective accounts.

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14.IA.9.2.3 Intermediary account balances Control Objective To verify whether access right for period opening and closing in SAP are

available with only authorized person Nature of Work Step Analysis

Risk Incorporating unaudited JV/NELP figures in financials may lead to qualified audit report.

Nature of Control Automated 1. Use transaction code FBV3 to check parked documents.

a. Enter Company code b. Enter Fiscal YearCheck whether all the mandatory/ statutory trainings as per the MOU

guidelines are scheduled and conducted. 2. c. A list of parked documents, if any will be displayed. 3. Check whether all documents appearing as parked are deleted or posted before closing of

accounts for respective quarters. 4. Obtain reasons for abnormalities, if any, and report the same.

14.IA.9.3 JV/NELP accounting Control Objective To ensure appropriate cost of the trainings


Risk Inappropriate cost of training.


1. Take the access control list for user group in corporate accounts and check whether authorization for the same has been given to head as per BDP.Check whether the expenses incurred by the department are in adherence to the documented company policy. Use T-Code MIR4, FBL3N.

14.IA.9.4 Access rights Control Objective To verify whether access right for period opening and closing in SAP are

available with only authorized person Nature of Work Step Analysis Risk Lack of control over period opening and closing module may result in

misappropriation of financials. Nature of Control Automated

1. Take the access control list for user group in corporate accounts and check whether authorization for the same has been given to head as per BDP.Check whether approvals for PRs, issue of spares/materials and conducting jobs are taken as per DOP.

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14.IA.9.5 Non routine activities

Control Objective Appropriate accounting treatment is specified for each non-routine event, transaction, and account balance, including those requiring the use of accounting estimates and judgment in the selection and application of accounting principles

Nature of Work Step Verification/Analysis

Risk Incorrect financial statements


1. Understand the procedures relating to accounting treatment for classes of transactions and account balances that

a. contain estimates, b. are non routine events c. transactions that require application of judgment d. Communication of such information to responsible parties.Check whether service entry

in SAP is made by EIC on a timely basis. 2. Understand the policies and procedures for computing estimates, including the framework for

applying judgment, and the communication of such information to responsible parties on a regular basis.

3. Interview individuals who prepare and update information about classes of transactions and account balances that contain estimates or that require judgment and those responsible for the establishing and documenting timeframes and appropriate methods for computing estimates, including the framework for applying judgment. Ask them to describe the following:

a. the steps involved, b. reports and other information used, including how they are used, c. the procedures performed when exceptions, misstatements, or unusual items are

encountered, d. how the control activity is performed in their absence, and e. any changes to the control activity during the period of intended reliance, including

changes in the individuals who perform the activity.

14.IA.9.6 Report and ledger review Control Objective Periodic review of SAP generated reports

Nature of Work Step Verification Risk Incorrect financial statements. Nature of Control Automated

1. Review the following reports for year end and month end activities: a. S_ALR_87012277 - GL Account Balances b. F.17 - Review of GRIR balances c. AR01 - Asset Register d. FB03 - Review of Parked documents. e. FBL3N/ FF67 - Bank Reconciliation reports f. S_P99_41000192 - Posted Depreciation g. S_ALR_87012349 - Outstanding Checks Analysis per GL and VendorAccount. h. J1INMIS - TDS reporting. i. MB5B/MC.9 - Material and Stock Account Reconciliations. j. OB52/MMPV - Period Closing in SAP k. FAGL_FC_VAL - Foreign Currency Revaluation l. Crude oil levels and its rate of depletion.

Audit Checklist

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14.IA.10 Finance & Accounts – Payroll

Scope Audit Areas

1 Payroll policies

2 Processing and disbursement of salaries

3 Reimbursement claims

4 Retirement benefits

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14.IA.10.1 Payroll Policies Control Objective To avoid unauthorized activities Nature of Work Step Verification Risk Unauthorized payroll. Nature of Control Manual

1. Check whether all policies are approved from competent authority as per Delegation of Power (DOP).

2. Check whether revisions to the policies (if any) are approved from competent authority as per Delegation of Power (DOP).

3. Check the compliance to the policies w.r.t to remuneration and compensation of the employees.

14.IA.10.2.1 Processing and disbursement of salaries Control Objective Ensure controls for salary processing, accounting in books and timely

disbursements Nature of Work Step Verification/Analysis Risk Incorrect/ delayed payment of salary. Nature of Control Manual / Automated

1. Review whether salary was processed as per defined timeline. PC00_M40_KTO. 2. Perform salary reconciliation for sample employees of consecutive months, and check whether

there are variances in salary. T-code: PC00_M99_CWTR / PCOO_M40_CEDT. 3. Use T-code PC00_M99_CWTR to check the accounting treatment of salary, unpaid salary and

bonus accounts etc. 4. Review whether the advice sent to Bank is encrypted. (To ensure there are no variations possible

afterwards) 5. Check if final salary voucher and disbursement is approved as per DOA. 6. Use T-codes PC00_M40_LJN and PC00_M99_CWTR to check if accurate deductions on account of

TDS, loans, advances etc. are made from the salary which is verified by Finance for accuracy. (Check detailed calculations on a sample basis).

7. Ensure on a sample basis whether original documents are available for reimbursements. 8. Use T-codes PC00_M99_CIPC and PC00_M40_LJN to check the calculation of last month salary for

outgoing employees for accuracy. 9. Use T-codes PC00_M99_CWTR to ensure notice pay has been recovered if a person leaves without

serving the notice period. 10. Use T-codes PT50 and PT_QTA10 to check any negative balance of leave to be deducted from

salary. 11. Use T-code PC_PAYRESULT to check if all assets issued to the employee have been taken back and

then only full and final sheet has been prepared. Use T-code PC_PAYRESULT to check the full and final statements and ensure that they are completed in reasonable time.

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14.IA.10.2.2 Claims processing and follow-up Control Objective Compliances to various HR laws Nature of Work Step Transaction Risk Initiation of penal actions by Governing authorities. Nature of Control Automated/ Manual

1. Obtain a list of latest applicable regulations in respect to employee welfare & security a. PF Laws b. Income Tax Laws TDS provisions. c. Payment of Bonus Act d.Payment of Gratuity Act e.Other relevant laws.

2. Verify whether compliances to same have been done.

14.IA.10.3 Reimbursement claims Control Objective Ensure controls for processing of reimbursement claims and timely

disbursements Nature of Work Step Verification

Risk Incorrect/ delayed reimbursement. Nature of Control Manual

1. Obtain a list of reimbursements made during the review period using T-Code: PC00_M40_REMP. 2. Obtain the Company policy for employee reimbursement. 3. For a sample, check whether re-imbursements are made as per policy and approved as per DOA.

14.IA.10.4 Retirement benefits Control Objective Calculation of retirement benefits, eligibility.


Risk Incorrect payment of retirement benefits.


1. Use T-codes PA20 and PC_PAYRESULT to check the calculation of deduction on account of retirement benefits from employees on sample basis

2. Use T-codes PA20, PC_PAYRESULT, PC00_M99_CWTR to check the eligibility of retirement benefits to employee availing the same.

3. Use T-codes PC00_M40_PFE and PC00_M99_CWTR to check if the deductions made are deposited with appropriate authorities on timely basis (EPF, Superannuation etc.).

4. Use T-code PC00_M99_CWTR, PA20 to check the accounting of retirement benefits. 5. Use T-code PC_PAYRESULT to check the full and final statements and ensure it is completed in

reasonable time.

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14.IA.11 Finance & Accounts – Receivables

Scope Audit Areas

1 Matching sales orders

2 Price master

3 Posting to receivables

4 Monitoring of receivables

5 Debit/ Credit notes

6 Legal case initiation

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14.IA.11.1 Master creation Control Objective Responsibility of person creating master, updation of master and party codes Nature of Work Step Verification / Analysis Risk Unauthorized creation of customers in master. Nature of Control Manual / Automated

1. Use T-code SUIM to check the list of persons authorized to create the Customer Master. 2. To check if a maker-checker control is in place before creation of the master to avoid duplicate

codes. 3. Use S_ALR_87012179 to obtain list of customer master. Check for:

a. Duplicate vendors. b. Incomplete details / incorrect details c. Inactive customers / blacklisted customers.

4. To check whether customer master changes are authorized, check authorization for VD02/FD02/FBL6. Verify that changes in the master approved as per DOP. Also verify the reason for any change in Customer Master.

14.IA.11.2 Matching sales orders Control Objective Terms of sales orders, party purchase orders, rate comparison Nature of Work Step Verification/Analysis Risk Incorrect billing to customers. Nature of Control Manual

1. Use T-codes VF25, VF05 and V.21 to ensure that every sales order is backed by an authorized contract/ MOU.

2. Use T-codes FBL3N and VF05 to match invoice terms, rates and quantities against contracts. 3. Check whether any payments are being made against expired contracts.

14.IA.11.3 Price Master Control Objective Updating of price master and invoice booking Nature of Work Step Verification Risk Incorrect billing to customers. Nature of Control Automated/ Manual

1. Use T-codes V/I6, and V/LC to check if the Price Master is updated regularly. 2. Use T-codes V/I6, V/LC, and V/LD to obtain the list of declared prices (as agreed upon based on

the MOU) from time to time and ensure that no bill is raised with incorrect price.

14.IA.11.4 Posting to receivables Control Objective Booking receivables and posting collections


Risk Delay in accounting of revenue received leading to incorrect picture of financial health.

Nature of Control Automated / Manual 1. Use T-codes VF25, VF05, VF05N and V.21 to check if all invoices are raised on the basis of the

dispatch advise / delivery sheet. 2. Use T-codes FBL3N and VF05 to check whether money received is applied against invoices and

reconciled periodically. 3. Check the reconciliation sheet with bank for any miscellaneous payment received. Check

whether reconciliation sheet is made and updated regularly. 4. Use T-code FBL3N to ensure that post-dated cheques are entered in system only on actual

deposit of cheques in the bank and if a separate file is maintained for keeping track of post-

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dated cheques. 5. Check if debtor aging is available with the department responsible for collection. Perform

separate aging analysis and compare with againg analysis prepared by Finance team. 6. Use T-code FBL5N to check for overdue balances and check for case-wise responses. 7. In case of major customers, take balance confirmations. 8. Use T-codes FBL5N, FBL6N, VF05 and V.21 to check for controls present in SAP to track invoices

that are pending to be received.

14.IA.11.5.1 Monitoring of receivables Control Objective Monitoring of receivables, balance confirmation and write-offs


Risk Delay in collection of dues leading to lack of working capital.


1. Check if ageing of receivables is performed on regular basis and reviewed by the management. 2. Check if adequate follow-up procedures to recover old dues are established. 3. Use T-code FBL3N to check if provision for doubtful recoveries has been made in line with DOP. 4. Check if all write-offs are approved as per DOP. 5. Use T-code FBL5N to check if balances are confirmed with all parties on regular basis. 6. Use T-codes FBL3N and FBL5N to check if reconciliation of differences noted in balance

confirmation is available.

14.IA.11.5.1 Monitoring of receivables Control Objective Ensuring subsidy is collected as per the agreement


Risk Under recovery.


1. In case of subsidized sales, review whether same has been billed to and received from respective Government agencies.

14.IA.11.6 Debit/ Credit notes Control Objective Ensuring adequacy of DR/CR notes raised


Risk Delay in collection of dues leading to lack of working capital.

Nature of Control Automated / Manual

1. Use T-codes VFRB and CV03N to check if all debit/ credit notes are backed by adequate supporting, and are approved as per DOA.

2. Check if customer acknowledgement/ acceptance is obtained for all DR/CR notes raised to customers.

3. Use T-code FBL5N to check if all interest/ dues/ charges have been levied as per the contracts with the customers.

4. Review manually whether all charges leviable under the sales contract have been levied.

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14.IA.11.7 Legal case initiation Control Objective Initiation of legal cases


Risk Non-recovery of dues due to dispute with customer.


1. Check the long-pending dues and the procedure followed by the department to recover the same.

2. Check for any legal cases initiated by the department over non-recovery of payable amount by a customer.

3. Check if the issue is taken up with the adequate forum and government authorities to ensure recovery of old dues.

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14.IA.12 Finance & Accounts – Insurance

Scope Audit Areas

1 Insurance cover

2 Claims processing and follow-up

3 Pending claims

4 Accounting treatment

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14.IA.12.1.1 Insurance Cover Control Objective Adequate insurance coverage Nature of Work Step Verification Risk Occurrence of event which was not covered leading to financial loss. Nature of Control Manual

1. Check process which management undertakes to identify and assess risks. 2. Review the risks identified by divisions and determine whether all risks have been identified. 3. Review the operational and financial impact of each risk and determine whether action plans to

manage risks are appropriate. 4. AR10 for list of insurance / and obtain manual list for assets and employees.

14.IA.12.1.2 Insurance Cover Control Objective Timely identification of claims Nature of Work Step Verification/Analysis Risk Delays in claims. Nature of Control Manual

1. Check if officers responsible for risk management are identified. Review the procedures for managing risk in terms of: a. identification of potential claims (and future projections) b. purchase of appropriate coverage c. other action programs instituted to decrease losses/risk d. review of uninsured risks (and exposure to potential claims and deductions) e. approval of the risk management policies and procedures manual.

2. Review strategies used to manage risks: a. Avoid (i.e. other alternatives) b. Accept (i.e. after they are minimized) c. Diversify (i.e. other business activities) d. Share/transfer (i.e. through contracts such as insurance and joint venture partners).

14.IA.12.2 Claims processing and follow-up Control Objective 1. All claims are timely reported and re-imbursed by the insurers

2. All policies and procedures have been adhered to. Nature of Work Step Verification/Analysis Risk Delays in claims. Nature of Control Automated/ Manual

1. Conduct a walk-through of claims processing process and supporting documents to understand how the claims are reported.

2. Use T-code WTYSE to get the list of claims under processing. Select sample of claims and use T-code WTYSE and enter claim number to verify:

a. Timeliness of the claims filing b. If any incident which could possibly give rise to a claim has been immediately reported to

the insurer with a copy to the insurance broker c. Any loss by theft and/or willful or malicious damage was immediately reported to the

nearest police station d. Whether compliance has been made with the relevant claims procedure specified to the

class of insurance for which the claim applies to. 3. Check whether the appropriate claim form has been completed and submitted to the Insurer

with the supporting documents without delay with a copy to the insurance broker.

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14.IA.12.3 Pending claims Control Objective Timely monitoring of pending claims


Risk Delays in settlements due to inadequate follow-ups. Nature of Control Automated / Manual

1. Use T-code WTYSE to get the list of claims under processing. Check the list of claims pending due to reason of non receipt of report from surveyor.

2. Check the list of claims pending with insurance company. 3. Ensure in case of delay from supplier's side adequate steps have been taken.

14.IA.12.4 JV/NELP accounting Control Objective Correct Accounting treatment for received and pending claims


Risk Incorrect accounting.


1. Ensure correct accounting treatment for pending claims. 2. Check for treatment of premium. Check premium has been differentiated into current year

premium and prepaid insurance. 3. Check correct head has been credited or reduced from the asset value in case money is received

from insurance company. 4. Check insurance GL using FBL3N, and verify on a sample basis that insurance postings are done

appropriately

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15. Geology & Reservoir – Internal Audit Scope

Audit Areas


2 Exploration & Development

3 Operations

4 Reservoir

5 Reserve appraisal

6 PR tracking


8 Manpower planning

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15.IA.1 Planning, budgeting & monitoring Control Objectives Adequate planning and approvals, effective tracking of annual

plan, compliance to DOP


Risk 1. Inappropriate approvals.

2. Delays in preparation of budget.


1. Check whether the annual plan of G&R department is complete and all-inclusive to cover the

requirements of all the activities that come under its purview.

2. In version management check the changes done in the budget.

3. Check for appropriate approval as per DOP for the budget and subsequent changes.

4. Check whether annual plan made is -

a. Linked to the requirement of various departments

b. Inclusive of all the related costs.

5. Check the timelines for preparation and approval of budget.

6. Use T-Code S_ALR_87013532 by entering cost center to check whether actual expenses are


15.IA.2PR tracking

Control Objectives Timely raising of PR and monitoring


Risk Delay in procurement leading to costlier procurement/ stock out

situations / operational delays



2. Check whether approvals for PRs, issue of spares/materials and conducting jobs are taken as per

DOP.

3. Conduct lead time analysis between PR initiation and release. Ensure that reasoning analysis is


4. Check whether there is a process of reviewing pending PRs and whether a follow-up process with


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16. Geophysics – Internal Audit

Scope

Audit Areas


2 Interpretation

3 Planning and execution of seismic and related data acquisition


5 Instruments management and maintenance

6 Buy vis a vis hiring of instruments / equipment

7 Seismic data processing and archival of data

8 Technical upgradation

9 PR tracking



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compliance to DOP Nature of Work Step Analysis / Verification Risk 1. Inappropriate approvals. 2. Delays in preparation of budget. Nature of Control Automated/Manual

1. Adequate planning and approvals, effective tracking of annual plan, compliance to 2. Use T-Code KSBL and enter cost center to get budget. 3. In version management check the changes done in the budget. 4. Check for appropriate approval as per DOP for the budget and subsequent changes. 5. Check whether annual plan made is -










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17. Human Resources

Scope Audit Areas

1 HR Payroll Policies

2 Employee master maintenance

3 Leave and attendance records

4 Payroll-Processing and Disbursement

5 Statutory compliance

6 Hospitality services

7 Manpower planning

8 Attrition rate analysis

9 Budgeting

10 PR tracking

11 Training employees

12 Performance evaluation and feedback

13 Setting goals

14 Motivating employees

15 Education policy

16 Raising requisitions

17 Mode of recruitment

18 Recruitment notice

19 Evaluation process

20 Finalization of selection and pre joining formalities

21 Contract employees

22 Joining process

23 Recruitment expenses

24 Appraisal policy and process

25 Appraisal process

26 Eligibility and approvals

27 Recent promotions

28 Employee interaction and communication

29 SAP Change Management

30 Grievance management system

31 Leave policy

32 Travel policy

33 Insurance policy

34 Job rotation and transfer

35 Resignations

36 Clearance procedures

37 Voluntary retirement scheme

38 Exit interview

39 Full and final payments (F&F)

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40 Policies

41 Appointment of consultant

42 Legal/Vigilance

43 RTI cases

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17.IA.1 HR payroll policies Control Objective To avoid unauthorized activities and transactions unfavorable to the

organization Nature of Work Step Analysis / Verification Risk Unauthorized activities Nature of Control Automated/Manual

1. Check whether HR policies are approved from competent authority as per Delegation of Power (DOP).

2. Check whether revisions to HR policies (if any) are approved from competent authority as per Delegation of Power (DOP).

3. Check the compliance to the HR policies w.r.t to remuneration and compensation of the employees.

4. Check whether all HR policies are maintained in a central respositary accessible to all employees. 5. Check whether any change in HR policies is updated and uploaded in intranet and mail

intimation is circulated to the employees timely.

17.IA.2 Employee master maintenance Control Objective To ensure correct updation of employee master for accurate processing of

transactions Nature of Work Step Verification Risk Access to unauthorized employees.

Nature of Control Automated / Manual 1. Check if the access to add or modify the employee master is restricted to authorized persons only.

TheT - code reference for reports /verification is S_AHR_61003750/S_AHR_61003751 to get the access right details and map it with the employee’s role.

2. Check whether all the changes in the audit period are duly authorized as per the defined policy and DOP.

3. Check whether audit logs are maintained and reviewed for the changes to employee masters. The T-code reference for reports/verification is S_AHR_61016380.

17.IA.3 Statutory compliance Control Objective To ensure timely and accurate compliance to all statutory requirements.

Nature of Work Step Verification Risk Non compliance with statutory requirements. Nature of Control Manual

1. Check whether any checklist for tracking and ensuring the compliance to all statutory requirements is maintained.

2. To check if the department is ensuring the compliance to all statutory requirements. E.g. a. PF b. ESI c. Gratuity d. Other labor laws.

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17.IA.4 Hospitality services Control Objective Fair allocation Nature of Work Step Verification

Risk Employee dissatisfaction. Nature of Control Manual

1. Check existence of a competent system exists, to ensure recording of all guest house requisitions. Review appropriateness of basis of allocation. Check whether the system is designed to record all requests on first-cum-first basis.

2. Check whether the allocation is done as per the policy and on first-cum-first-served basis. Ensure that approval is taken for the same as per DOP.

3. Check whether recovery for the guest house is done as per the rates defined in policy. Check whether the amounts collected are timely submitted to Finance.

4. Check whether there exists a process of grievance management pertaining to hospitality services. Check what is the action taken to address the same.

17.IA.5 Leave and attendance records Control Objective To ensure timely and accurate updation of leave and attendance records


Risk Non updation of attendance records. Nature of Control Automated / Manual

1. Review the attendance monitoring process and ensure that office timings are communicated to all employees and correctly mapped in the attendance recording system. Use T-Code PT65 and enter the employee code to extract the attendance details rom the system and map it to the attendance records sent for payroll processing.

2. Check if the attendance is duly recorded and monitored. The T –code reference for reports /verification is PT65.

3. Verify whether attendance records are maintained and cross checked by an independent personnel. The T –code reference for reports /verification is PT65.

4. Ensure that leave balances are correctly recorded and carried forward to the next year. The T –code reference for reports /verification is PT50/PT_QTA10 and enter the employee code to get the leave details.

5. Examine the access rights to attendance and leave recording system and ascertain whether access rights are in line with the roles and responsibilities defined. The T –code reference for reports /verification is S_AHR_61003750/S_AHR_61003751 to get the access right details and map it with the employee’s role.

6. Ensure that the attendance and leave records are approved/ authorized as per the process before considered for monthly payroll.

7. Whether logs of access/ changes to the attendance and leave records are prepared and reviewed.

17.IA.6 Payroll- processing and disbursement Control Objective To ensure timely and accurate disbursement of salary to employees Nature of Work Step Verification Risk Inaccurate disbursement of salary. Nature of Control Manual

1. To check if correct leave records are used for processing of salary and the same tally with the attendance records maintained by the company.

2. Check the logs generated for changes in the employee master data after payroll processing. 3. Test check salary computations for employees. Ensure the salary processed is as per the

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Offer/Appointment letter of the employee or as per increment letter in case of increment given. 4. Check if any arrears to salary are accurately processed and duly approved before disbursement. 5. Ensure that leave encashment, overtime etc. are computed accurately and in accordance to the

company policy. The T-code reference for reports/verification is PC_PAYRESULT and enter the employee code from the sample selected. Check the calculation for the payroll is done correctly and as per policy.

6. Obtain and understand policies and procedures defining entitlement, time of submitting claim, approvals etc.

7. Examine the process of submission of reimbursements by the employee. The T-code reference for reports/verification is PC00_M40_REMS to check the status of claims and ensure whether the approval has been done as per DOP.

8. Check for any advances or loans paid to the employees, and if deductions are paid for the same from the salary. Use T-code PA30 and enter the employee code to check whether there is any outstanding loan against the employee. Thereafter, use T-Code PC_PAYRESULT to check whether the loan is being deducted gradually from the salary.

9. Review the disbursement of payroll is in accordance to the approval payroll processed. 10. Review and analyze the payment disbursement for current month with last two months

(employee wise). 11. Check the payroll variance report and investigate instances wherein there is a huge variance

between the salaries paid during the months. Use T-code PC00_M40_ANN/PC00_M99_CWTR to extract the summary of amount paid under various heads of payroll. Examine reasons for major differences noted.

12. Examine the cases where disbursement of salary was made through cash (if any).

17.IA.7 Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Verification/Analysis Risk 1. Over/Under Utilization of manpower


1. Check whether there is adequate manpower to carry out all the operations of the department 2. Ensure manpower requisition forms are raised timely and approved as per DOP. 3. Check whether there is a follow up process in place to ensure timely conversion of MPR.

17.IA.8 Attrition rate analysis Control Objective Least attrition rate Nature of Work Step Verification Risk High attrition rate Nature of Control Manual / Manual

1. To check the attrition rate used to forecast manpower requirements and compare the same with actual attrition rate. Use T-Code S_L9C_94000095 to calculate the number of employees who have left the organization.

2. Compare current year attrition rate with previous years and the reason for increase or decrease. 3. To check the last year attrition rate and the rate used for budgeting last year. 4. To check whether any replacement done due to separations are adequately approved if not

factored in initial planning. Use T-Code S_AHR_61016509 to view the number of vacant positions.

5. To check if any action plan is prepared for handling the attrition rate. 6. To check if future attritions (other than normal rate of attritions) due to mass retirements etc.

are factored in planning.

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17.IA.9 Budgeting Control Objective Control expenditure Nature of Work Step Verification / Analysis Risk Uncontrolled expenditure. Nature of Control Manual

1. To check the current year budgeted expenditure of manpower cost and compare the same with actual cost for current year as well as previous year budgeted expenditure.







17.IA.11 Training employees Control Objective Operation efficiency and satisfaction of employees leading to organizational

development Nature of Work Step Verification / Analysis Risk Operational inefficiency. Nature of Control Manual / Automated

1. To check whether regular training sessions are conducted on code of conduct. 2. To check that training session are conducted at all level of employees. Use T- code

S_PH9_46000433 to view the attendance for trainings and ensure employees from all levels attend the trainings.

3. To check that job description is clearly defined at all positions in company. Use T- code S_AHR_61016497, S_AHR_61016498 to view job descriptions.

4. To check that Code of ethics and value charter has been signed by employees.

17.IA.12 Performance evaluation and feedback Control Objective Timely detection of performance and ensuring 2 way communication Nature of Work Step Verification Risk Lower productivity of employees. Nature of Control Manual / Automated

17.IA.13 Setting goals Control Objective Organization growth along with personal growth Nature of Work Step Verification Risk Inefficient goal setting. Nature of Control Manual

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1. To check whether individual goals have been set and submitted with the respective heads. 2. To check whether goals set have been submitted to the Approving authority and they have been

approved timely. 3. To check that goals set by individuals are in line with organization goals and related to the job of

the person.

17.IA.14 Motivating employees Control Objective Keeping high motivation level for best output Nature of Work Step Verification Risk Lack of motivation. Nature of Control Manual

1. To check whether individual goals have been set and submitted with the respective heads. 2. To check whether goals set have been submitted to the Approving authority and they have been

approved timely. 3. To check that goals set by individuals are in line with organization goals and related to the job of

the person.

17.IA.15 Education Policy Control Objective Updating of knowledge and skills and continuous learning Nature of Work Step Verification Risk Insufficient learning and no updating of knowledge. Nature of Control Manual

1. To check whether education policy has been formed and duly approved. 2. To check the actions taken to motivate employees like arranging seminars to update employee's

knowledge and motivation level. 3. To check the number of person taking benefit of education policy.

17.IA.16 Raising Requisitions Control Objective All recruitments are done based on requisitions Nature of Work Step Analysis / Verification Risk Recruitments are not based on requisitions. Nature of Control Automated/Manual

1. To check the adherence to annual job rotation plan. The T-code reference for reports/verification is PA30.

2. To check whether the person transferred has been transferred on the basis of transfer policy. The T-code reference for reports/verification is PA30.

3. To check if the company policy w.r.t to mandatory transfers is followed for all employees unless specific approval is obtained from the competent authority. The T-code reference for reports/ verification is PA30, PA40.

4. Check if in case of extension in transfer / job rotation, approval from competent authority has been obtained.

5. To check that proper training has been imparted in case new job responsibilities are to be performed after transfer.

6. To check the time lag in processing the transfer requests. The T-code reference for reports/ verification is PA30, PA40.

7. To check whether the SAP has been updated with revised transfer details. . The T-code reference for reports/ verification is PA40/PA30.

8. To check accuracy of the payroll process for the overlapping period. . The T-code reference for reports/verification is PC_PAYRESULT. Check whether confirmation or acknowledgement of work completed is taken from contractor on measurement book.

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17.IA.17 Mode of recruitment Control Objective Selection of mode of requirement based on cost and other factors Nature of Work Step Analysis / Verification Risk The mode of requirement is not based on specific factors. Nature of Control Automated / Manual

1. Tocheck that last date of application is mentioned on the notice of vacancy. 2. To check that correct mode of examination has been conducted like level B/C employees are

tested via interview/ viva only. 3. To check recruitment plan is prepared in advance and approved by HOD for recruitments to be

done during the period so that timely recruitment is done considering the mode of recruitment. Use T-Code S_AHR_61015516 to check the vacancies and whether the recruitment plan is taking into account the number of positions to be filled.

4. To check if proper documentation is available to substantiate that recruitment is conducted from the same mode in which it is planned.

5. To check if all the required guidelines issued from time to time are followed for recruitment considering equal opportunity to all eligible candidate.Conduct lead time analysis between PR initiation and release. Ensure that reasoning analysis is conducted for delays.

17.IA.18 Recruitment notice Control Objective Selection based on defined process Nature of Work Step Verification Risk Selection is not based on defined processes.

Nature of Control Manual 1. Check if recruitment process is started according to the basis of defined plan. 2. Check if proper notice/ advertisement is issued for all the vacancies defining the following:

a. Job requirement and responsibilities b. Eligibility criteria's c. Educational qualifications d. Experience criteria's e. Evaluation criteria's etc. Use T-Code S_AHR_61015517 to extract the population of job advertisements.

3. Check if the advertisement is published at all the required places (e.g. newspaper and websites etc.).

4. In case of campus recruitments, check if the recruitment is done from the pre-approved institution.

5. To check the list of candidates shortlisted for interview and their experience papers. 6. To check that no application has been accepted which has been received after the last date

unless approved. Use T-Code S_AHR_61015510 to check the date of receipt of application. 7. To check if adequate tracking and monitoring process is in place to ensure completion of

recruitment process in time.

17.IA.19 Evaluation Process Control Objective Screening, initial screening of documents, written test, group discussion,

interview, medical examination. Nature of Work Step Verification Risk Non screening of documents.

Nature of Control Manual 1. To check if timely and adequate screening is done to identify the eligible candidates for

proceeding with the recruitment process

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2. Check if the screening is done by the authorized and independent person to objective screening of the candidates

3. Check if the final list of eligible candidate is prepared and approved by HOD to process for further process

4. Verify sample cases to check if all the candidates are eligible as per the requirement posted in advertisement

5. Check if adequate mix is maintained to adhere to the various regulation and quotas (e.g. SC/ST vacancies). Use T-Code PA30 to check the quota(SC,ST) et

6. Check if the copies and original of the required documents are verified to ensure appropriateness of the details mentioned in the application form

7. Check if results are adequately documented and then on eligible candidates are selected. Use T-Code S_AHR_61015513 to check the applicant statistics of the selected employees. Ensure that the statistics are in line with the policy and standar

8. To check whether written test was conducted according the timelines mentioned in the advertisement or communicated thereafte

9. Check if any change in the date of test is communicated well in advance to the eligible candidates

10. Check if adequate evaluation of the written test is conducted in time for selection of candidates. Check if GD is conducted for the vacancies requiring GD as per polic

11. Check if the panel of observers with defined criteria of selection is finalized in advance 12. Check if adequate documentation is maintained for all the candidates for selection/ rejection

reasons. Use T-Code PB10 to check whether reasons for selection or rejection are documente 13. Check if the interview panel is finalized and approved in advance as per DOP 14. Check if adequate mix of the interview panel is maintained in line with the required policy (e.g.

if recruitment involves SC/ST candidate, then 1 member must be SC/ST category) 15. To check all interview processes are completed within specified time 16. Check if the interview evaluation sheet is prepared and the rating of each candidate (for all

rejected/ selected candidates) 17. Post the interview, check if a report is prepared by the interview panel which is put to

competent authority for approval stating result of the recruitment process 18. Upon approval, check if the final candidates are called for medical examination. On clearance of

the same, offer letter is sent to the candidate for joining.

17.IA.20 Finalization of selection and pre joining formalities Control Objective Proper approvals and selection and pre joining formalities. Nature of Work Step Verification Risk Improper approvals.

Nature of Control Manual 1. Check if adequate documentation is maintained for all the evaluation conducted for finalizing

the candidates. Use T-Code PB30 to view the employee master, an thereafter check hardcopy supporting for sample employees.

2. To check whether medical examination was conducted for all shortlisted candidates. 3. To check whether all conditions like selection of quota candidates has been adhered to. 4. To check that all offer letters contain clearly defined policies like of Independence. 5. To check if the offer letter clearly defined the documents which the candidate need to submit

before joining. 6. To check if the offer letter clearly defines other requirements (if any) which the candidate need

to fulfill before joining. 7. Check if the offer letter is issued based on approval from authorized person as per DOP. 8. To check that all joining formalities like maintenance of employee files, medical checks have

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been done. 9. To check whether employee files are properly maintained and contain necessary documents like

blood group report. 10. To check the reference check and background check forms have been documented in employee

files. 11. To check whether offer letter clearly states the last date of joining unless approved by

concerned authority.

17.IA.21 Contract Employees Control Objective Contract Employees Nature of Work Step Verification Risk Excess recruitment and improper selection.

Nature of Control Manual 1. Check if recruitment on contract basis is done in case of urgency which could not be planned in

the manpower plan. 2. Check if the contractual recruitment is initiated on the basis of approved manpower requisition

by competent authority stating the justification of such recruitment. 3. Check if the adequate evaluation process from screening to finalization is followed for

contracted employees. 4. Check if the contract with the employee is duly approved by legal and for the limited period of

requirement. 5. Check the process of renewal of candidate is followed after ensuring equal opportunity to all

prospective candidates unless approved by the competent authority as per DOP. 6. Check if all the documentation requirement is completed for the contracted employee before

joining. Check if the offer letter is issued based on approval from authorized person as per DOP.

17.IA.22 Joining process Control Objective Collection and documentation of mandatory documents in employee

personnel file, to smoothen the entry of newly joined executives in the organization

Nature of Work Step Verification Risk Improper documentation.

Nature of Control Manual 1. Check the periodicity for conducting the induction for the newly joined employees. 2. Check whether the data specified in the induction template / document have been updated

from time to time. 3. Check whether Job responsibilities/ descriptions (JDs) are adequately defined for all positions

and communicated to employees at the time of joining. 4. Check whether copy of all the mandatory certificates and photo ID cards have been collected

from the employee. 5. Check employee master data and personal files are accessible by authorized personnel's only.

Use T-code S_AHR_61003750 /S_AHR_61003751 to view the employees provided with the access rights and thereafter, map the same to the roles and responsibilities as per policy.

6. Check the time lag (if any) in generation of the joining report for the new employees. Use T-Code S_AHR_61015513 to check the applicants joining status.

7. Check the dates of sign off on the appointment letters issued to the employees. The T-code reference for reports/verification is S_AHR_61015513.

8. Check if the employee file is updated with all the records and documents w.r.t. to the new employee. Use T-Code PA40 to view the employee master and ensure its completeness. Check the hardcopy supporting for a sample number of employees.

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17.IA.23 Recruitment Expenses Control Objective Ensure adequate control over expenses incurred for recruitment Nature of Work Step Analysis / Verification Risk Inadequate control over expenses.

Nature of Control Manual/ Automated 1. Check if adequate budget is in place for incurring the recruitment expenses. Use T-Code KSBL

and then enter the cost center. 2. Check if budget Vs. actual is monitored for all recruitment expenses. The T-code reference for

reports/verification is S_ALR_87013611 to view the actual vs. budgeted as per system. Check if reasoning analysis and approvals are available whenever the budget is exceeded.

3. Check if all expenses are incurred with prior approval according to DOP. 4. Check if re-imbursement to candidates is made based on eligibility and with adequate approval

as per DOP. Use T-Code PA40 to view the employee master and the designation. Thereafter, check the reimbursement policy and entitlement as per designation and use T-code PC00_M40_REMS to check whether the reimbursement is made as per policy and approval is taken as per DOP.

5. Check if recruitment expenses are properly accounted and monitored. The T-code reference for reports/verification is S_ALR_87013611.

17.IA.24 Appraisal policy and process Control Objective Clearly defined policy and process to be followed Nature of Work Step Analysis / Verification Risk Unclear policies, not defined properly.

Nature of Control Manual/ Automated 1. To check that policy for promotion is available and duly authorized. The T-code reference for

reports /verification is PA40. 2. Check if the process of PMS clearly defines the timelines, authority and protocols to be followed

for PMS. The T-code reference for reports /verification is APPSEARCH. 3. Check the eligibility criteria's defined for promotions for all grades. The T-code reference for

reports /verification is APPSEARCH.

17.IA.25 Appraisal process Control Objective Adherence to defined and transparent appraisal process Nature of Work Step Verification Risk Non adherence to appraisal process.

Nature of Control Manual/ Automated 1. Check if the appraisal is conducted in accordance to the defined policy and process. The T-code

reference for reports/verification is APPSEARCH. 2. Check if the self appraisal is adequately documented and then reviewed by the appraiser with

feedback on strengths and improvement areas. The T-code reference for reports/verification is APPSEARCH.

3. Check if the compilation of initial ratings are done by HR and reviewed in line with policy. The T-code reference for reports/verification is APPSEARCH.

4. Check if adequate process is followed for normalization and approved as per DOP. The T-code reference for reports/verification is APPSEARCH.

5. Check if the final rating on the basis of following parameters are accurately calculated and then finalized. The T-code reference for reports/verification is APPSEARCH.

6. Check if the improvement areas are communicated to L&D for planning of required trainings. The T-code reference for reports/verification is APPSEARCH.

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7. Check if the final incentive and increments are accurately decided and circulated in accordance to the PRP ratings. The T-code reference for reports/verification is APPSEARCH.ed for promotions for al grades. The T-code reference for reports /verification is APPSEARCH.

17.IA.26 Eligibility and approvals Control Objective Eligible employees are promoted only. Only department approved candidates

are promoted Nature of Work Step Verification Risk Promotions to ineligible employees

Nature of Control Manual/ Automated 1. To check that list of persons eligible for promotion is prepared at each level and cross check it

from eligibility criteria. The T-code reference for reports/verification is S_AHR_61016356 and enter the sample employee code.

2. Check the number of eligible candidates against the total number of vacant seats. The T-code reference for reports/verification is S_AHR_61016356 to determine the number of eligible candidates and S_L9C_94000095 to determine the number of vacancies.

3. Check if all promotions are adequately approved as per defined DOA. Use T-Code PA40 to check the master data for appraisal. Further use T-code APPSEARCH to check whether the promotion has been done as per DOP defined in the master data.

4. Check if promotion is decided after considering all the parameters according to the policy (e.g. experience, seniority etc.) Use T-Code PA40 to check the master data for appraisal. Further use T-code APPSEARCH to check whether the promotion has been done as per policy.

5. To check that the list of employees eligible for promotion was vetted by concerned departments. The T-code reference for reports/ verification is APPSEARCH.

6. To check the time taken in sending documents to department for approval and time taken by department for approving the same. The T-code reference for reports /verification is APPSEARCH.

7. To check whether applications received in this regard have been forwarded to the concerned department for scrutiny of final details. The T-code reference for reports/verification is APPSEARCH.

17.IA.27 Recent promotions Control Objective Eligible employees are promoted only Nature of Work Step Verification Risk Undeserving employees are promoted.

Nature of Control Manual/ Automated 1. Check the controls in place for scheduling exams for promotions for grade A and grade B

executives. 2. Check whether selection committee was constituted before conducting the exam. 3. Check whether all eligible candidates were issued call letters clearly specifying the date and

venue for examination/interview. 4. Check the time taken in issuing promotion letters from final selection. Use T-Code

S_AHR_61016503 to view the list of promotions. 5. Review the APR marks / merit list with the promotions announced. Use T-Code

S_AHR_61016503 to view the list of promotions. 6. Check whether employee master is updated with new salary structure and grades immediately

after announcement. The T-code reference for reports/verification is PA30. 7. To check the total number of employees promoted against the total number of vacant seats The

T-code reference for reports/verification is S_AHR_61016356 to check the number of employees promoted and T-Code S_L9C_94000095 is to check the number of vacant positions.

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17.IA.28 Employee interaction and communication Control Objective Employee satisfaction Nature of Work Step Verification Risk Employee dissatisfaction.

Nature of Control Manual 1. To check the process of intimation and communicating with employees on performance. 2. Check the controls over issue of promotion letter to the employees like authorized person to

issue the same and mode of giving.

17.IA.29 SAP Change Management Control Objective All changes are authorized and updated in SAP Nature of Work Step Analysis / Verification Risk Unauthorized changes.

Nature of Control Manual / Automated 1. To check whether change management policy is available. 2. To check that Change request form is duly authorized as per DOP. 3. To check that Change request form is duly authorized by HR Head. 4. To check that all change requests are available and separately recorded. 5. To check that proper reason for change is given and also check its impact. The T-code reference

for reports/verification is solman_workcenter to check whether adequate reasoning is available and approval has been taken as per DOP.

6. To check controls present in system to restrict data leakage like salary of employees. The T-code reference for reports/verification is SUIM and enter the T-Codes used to consume budget to get a report about the users authorized to incur expenditure and value of expenditure incurred. This can then be checked with the defined policy, if any.

7. To check if SAP is updated timely SAP after change has been made in HR Policy. The T-code reference for reports/verification is PA30.

17.IA.30 Grievance management system Control Objective Employee satisfaction and timely redressed of employee grievances Nature of Work Step Verification Risk Employee dissatisfaction.

Nature of Control Manual 1. To check the system of receiving employee grievances. 2. To check the time taken to address the employee grievance. 3. To check steps taken to ensure employee satisfaction.To check whether change management

policy is available.

17.IA.31 Leave Policy Control Objective Planned leaves and social recognition Nature of Work Step Verification Risk Unplanned leaves.

Nature of Control Manual 1. To check whether leave policy is approved as per DOP. 2. To check whether leaves of employees is recorded in the system. The T-code reference for

reports/verification is PA30. 3. To check whether employees are encouraged to go on leaves in case their leaves get

accumulated. Use T-code PT50 and enter the employee code to check the employee's absence quota and T-Code PT_QTA10 to check the number of leaves availed.

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4. Check that the policy for maternity leave is available.

17.IA.32 Travel policy Control Objective Restricted expenditure on travel Nature of Work Step Verification Risk Unrestricted expenditure.

Nature of Control Manual 1. To check that travel policy is available and authorized as per DOP. 2. To check that expenses are reimbursed as per travel policy after authorization from heads. The

T-code reference for reports /verification is PC00_M40_REMS.

17.IA.33 Insurance policy Control Objective Security from loss of person or injury to employee Nature of Work Step Verification Risk Insecurity from loss of person.

Nature of Control Manual 1. To check whether insurance policies have been taken as per HR policy of the Company .The T-

code reference for reports /verification is PA30.

17.IA.34 Job rotation and transfer Control Objective Job transfers within or outside the department for personal growth and

avoiding monotonous jobs Nature of Work Step Analysis / Verification Risk Monotonous jobs leading to low employee productivity.

Nature of Control Manual / Automated 2. To check the adherence to annual job rotation plan. Use T-Code PA30 to view employee master

and perform analysis to ensure whether the job rotation plan is adhered with. 3. To check whether the person transferred has been transferred on the basis of transfer policy.

The T-code reference for reports/verification is PA30. 4. To check if the company policy w.r.t to mandatory transfers is followed for all employees unless

specific approval is obtained from the competent authority. The T-code reference for reports/verification is PA30, PA40.

5. Check if in case of extension in transfer / job rotation, approval from competent authority have been obtained.

6. To check that proper training has been imparted in case new job responsibilities are to be performed after transfer.

7. To check whether the SAP records have been updated with revised details after transfer such as dates, location, department etc. The T-code reference for reports/verification is PA40/PA30.

8. To check accuracy of the payroll process for the overlapping period. Use T-Code PC_PAYRESULT to check whether payroll calculations are done accurately and as per the policy.

17.IA.35 Resignations Control Objective To ensure adherence to defined policy. Nature of Work Step Analysis / Verification Risk Non adherence to defined policy.

Nature of Control Manual / Automated 1. Check the adherence to the HR policy guidelines for employee separation. 2. Check and analyze the attrition rate at the various management level.

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3. Check if the employee resignation is documented and accepted by HOD before relieving. 4. Check if intimation is send to the HR and payroll team by HOD on receipt of resignation. 5. Check if payroll is put on hold (in line with the policy requirement) on receipt of employee

resignation. 6. Check if employee is communicated to all the requirements need to be completed by him

before leaving the organization: a. No due to be cleared b. Assets to be returned c. Guarantee/ bond amount to be paid if any d. Notice to be served etc.

7. Check if HR initiates the retirement process in advance in case of retiring employee. 8. Check whether data back up have been obtained from the employee before his relieving.To

check the adherence to annual job rotation plan. Use T-Code PA30 to view employee master and perform analysis to ensure whether the job rotation plan is adhered with.

9. Check whether payroll calculations are done accurately and as per the policy.

17.IA.36 Clearance Procedures Control Objective To safeguard the interest of the Organization against physical / intellectual

property loss Nature of Work Step Verification Risk Physical intellectual property loss.

Nature of Control Manual 1. Check if clearance/ no due form is defined containing the authorities who need to give no due

clearance to all separating employees. 2. Check if all the receivables/recoverable are mentioned on the clearance form before by the

authorized person. 3. Check if all the following access are removed at the time of clearance:

a. Physical access card (if any) b. SAP Access by ERP team c. Oil Network Access by IT team.

4. Access to any other IT application by IT team. 5. Check if all the authorizations to the individual (if any) are removed:

a. Bank Account b. Dealing with third parties c. Reprinting company d. Power of Attorney etc.

17.IA.37 Voluntary retirement scheme Control Objective Hassle free retirement and separation Nature of Work Step Verification Risk Problematic retirement.

Nature of Control Manual / Automated 1. To check the number of person applying for early retirement or VRS scheme. Use T-code PA30

to view the employee master. Ensure it is updated with the details of employees applying for VRS.

2. Check the employee entitlement for the Early Retirement and Voluntary Premature Retirement schemes granted (if any). Use T-Code S_PH9_46000223 to check the employees joining date and department worked for in order to ascertain whether he is eligible for VRS.

3. To check the time lag between applying for VRS and actually sanctioning the same. 4. To check the reasons for same and also check the entitlement calculation.

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17.IA.38 Exit interview Control Objective Analyzing the reason to control turnover rate for future Nature of Work Step Verification Risk No proper reason is found for turnover rate.

Nature of Control Manual 1. Check whether there is a process of conducting exit interview at the time of separation and

whether reasons are identified & analyzed during the exit interview. 2. To check all exit interviews are available in employee files. 3. To check the steps taken by management to resolve such issues as stated in exit interviews.

17.IA.39 Full and final payments (F&F) Control Objective Accuracy and timely clearances Nature of Work Step Verification Risk 1. Inaccurate clearance/settlement payment.

2. Delay in settlement. Nature of Control Manual / Automated

1. Full and final settlement must be done for each and every employee only after all the company assets have been recovered.

2. Check the time difference between full & final from the date of releasing. Use T-code PA30 to check the last working day of employee and use TCode PC00_M99_PA03_check to check the date on which F&F was done. Ensure the time delay is within the timelines defined as per Company Policy.

3. Check the computation of Full & final settlement. The T-code reference for reports/verification is PC_PAYRESULT/PC00_M40_TERM.

4. Check if the tax deductions are appropriately provided on the basis of receipt of documentary evidence from the employee. Use T-Code - PC_PAYRESULT/PC00_M40_F16.

5. Check if resigned employees' records are timely updated in master records and check if these are not included in payroll computation sheet. The T-code reference for reports/verification is PA30.

6. Check the controls over issue of experience certificate to the employees and check that experience certificate is issued only after all clearances have been done by employee. The T-code reference for reports/verification is PA40.

7. To check whether any notice pay or bond money has been recovered from employee in case he refuses to serve the entire term of notice period or Bond period. . The T-code reference for reports/verification is PC_PAYRESULT.

8. Check if the full and final amount is disbursed timely in accordance to the policy.

17.IA.40 Policies Control Objective To avoid unauthorized activities and transactions unfavorable to the

organization Nature of Work Step Verification / Analysis Risk Unauthorized activities.

Nature of Control Manual 1. To check if there is defined process and policy to govern the handling of legal and vigilance

cases. 2. Check if the department has mechanism to monitoring the compliance to defined policy and

process for handling legal cases.

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17.IA.41 Appointment of consultant Control Objective To ensure adequate hiring and payment to consultant/ advocates Nature of Work Step Verification Risk Inadequate hiring of consultants.

Nature of Control Manual 1. Check if appointment of consultant/ advocate is done after due evaluation and approval as per

policy. 2. Check if the evaluation is carried out for the cases handled by the consultant. 3. Check if payment to the consultant is made after proper verification and required approvals as

per DOA

17.IA.42 Legal/Vigilance Control Objective To safeguard the interest of the Organization Nature of Work Step Verification Risk The interest of the organization is threatened.

Nature of Control Manual 1. Check whether there is a tracker maintained to keep a record of all the active and resolved legal

cases. Ensure whether it is updated timely. 2. Check whether guidelines exist to ensure adequate documentation for each legal case. Check

whether a document checklist has been prepared and followed. 3. Check the maintenance of documentary proof and witness for the cases. 4. Ensure settlement of employee full and final post solvation of the dispute. 5. Check if the past cases are reviewed and analyzed for common reasons with action plan to

prevent such cases in future. . 6. To check if there is adequate tracking and documentation of the cases initiated by vigilance.

17.IA.43 RTI cases Control Objective To safeguard the interest of the Organization and compliance to statutory

requirements. Nature of Work Step Verification Risk 1. Loss of goodwill

2. Non-compliance to statutory requirements. Nature of Control Manual

1. Check if the dedicated persons are identified for handling the RTI cases. 2. Check if all replies to RTI are properly verified and supported with adequate documentation to

ensure accuracy of reply. 3. Check if proper evidence is maintained ensuring date of receipt of RTI and reply to RTI.

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18. Information Technology – Internal Audit

Scope

Audit Areas


2 Statutory Compliance

3 User request management

4 Disaster recovery site

5 Process documentation

6 Backup procedures

7 IT administration

8 PR tracking



11 Physical access controls

12 Logical controls

13 IT applications

14 ERP solutions


16 IT infrastructure and environmental controls


18 Network security


20 Logical controls

21 IT applications

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18.IA.1 ITGC - Planning, budgeting & monitoring Control Objectives Adequate planning and approvals, effective tracking of annual plan,

compliance to DOP



2. Delays in preparation of budget

Nature of Control Manual /Automated

1. Check whether the annual plan of IT department is complete and all-inclusive to cover the requirements of all the activities that come under its purview.

2. Use T-Code KSBL and enter cost center to get budget. 3. In version management check the changes done in the budget. 4. Check for appropriate approval as per DOP for the budget and subsequent changes. 5. Check whether annual plan made is - a. Linked to the requirement of various departments b. Inclusive of all the related costs. 6. Check the timelines for preparation and approval of budget. 7. Use T-Code S_ALR_87013532 by entering cost center to check whether actual expenses are


18.IA.2 ITGC - Statutory Compliance Control Objectives Adherence to applicable Rules and Regulations


Risk Initiation of penal action by concerned authorities.


1. Check whether there is compliance framework to monitor or track compliance required under

various law/Acts applicable to the Company.

2. Verify whether compliance of applicable rules/provisions e.g. Information Technology Act are

monitored periodically.

3. Check whether non compliance to the requirements is reported to the management

periodically for further action.

4. Check whether statutory compliance reports are submitted.

5. Check whether disposal of written off scrap of IT systems is done as per applicable statutory

Acts/ Rules.

18.IA.3 ITGC - PR tracking Control Objectives Timely raising of PR and monitoring


Risk Delay in procurement leading to costlier procurement/ stock out

situations / operational delays.


1. Use T-Codes ME53N and ME5A to check whether PRs for spares/materials/jobs are raised

timely.

2. Check whether approvals for PRs, issue of spares/materials and conducting jobs are taken as

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per DOP.



4. Check whether there is a process of reviewing pending PRs and whether a follow-up process

with Contracts/Material Management exists.

18.IA.4 Commercial Systems - Physical access controls Control Objectives Access checks, CCTV's monitoring and data security

Nature of Work Step Verification/ Analysis

Risk Unsecure data and IT infrastructure.


1. Check that access to critical systems is available to authorized personnel only.

2. Check that CCTV's are available in and around critical areas.

3. Check if access logs are created for the persons accessing the Data Centre.

4. Check if critical IT equipment's are controlled through lock in key or access control.

5. Check that no internal confidential information like network diagram etc. is made available on

public domain.

18.IA.5 Infrastructure - Physical access controls Control Objectives Access checks, CCTV's monitoring and data security






3. Check if access logs are created for the persons accessing the data centre.



public domain.

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18.IA.6 Network & Communication - Physical access controls Control Objectives Access checks, CCTV's monitoring and data security









public domain.

18.IA.7Technical Systems - Physical access controls Control Objectives Access checks, CCTV's monitoring and data security









public domain.

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19. Instrumentation – Internal Audit

Scope Audit Areas


2 Operations

3 Maintenance

4 Projects

5 Environment, Health and Safety Compliance

6 PR Tracking

7 Manpower Planning

Audit Checklist

211

19.IA.1 Planning & Administration Control Objective Adequate planning, Effective monitoring over plan, Compliance to DOP Nature of Work Step Analysis / Verification Risk Inadequate planning. Nature of Control Manual / Automated

1. To check whether the plan of instrumentation department is complete and all-inclusive for man, materials, equipment required for preparation. Check whether the plan is in compliance on statutory obligations.

2. To check whether there are laid down procedures for preparation of plan and the same are complied with.

3. To check whether such plan is approved by competent authority as per DOP. The T-code reference for reports/verification is KSBL. This report provides the planning overview and can be used to check whether the plan is approved as per DOP.

4. To check whether any amendments in such plan is approved by competent authority as per DOP. The T-code reference for reports/verification is KSBL.

5. To check whether actual expenses are monitored / compared with planned expenses on periodic basis against such plan. The T-code reference for reports/verification is S_ALR_87013532.

6. To ensure timely procurement of material. Use MB5B to check the stock levels on a particular day and use ME5A to ensure that the PR is raised for the material where stocks are below the threshold levels defined.

7. To check whether there is non moving inventory at departmental storage location. The T-code reference for reports/verification is MC46

8. To ensure proper security is in place in laboratory.

19.IA.2 Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities. Nature of Work Step Analysis / Verification Risk 1. Over/Under Utilization of manpower.




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20. Land – Internal Audit

Scope Audit Areas

1 Planning and assessment

2 Acquisition of land through Bipartite Negotiation / Settlement

3 Acquisition of land through Land Acquisition Act, 1894

4 Acquisition of land under Provision of Forest (Conservation) Act, 1980

5 Land records

6 Restoration of land

7 PR tracking


9 Manpower planning

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20.IA.1.1 Acquisition of land through Bipartite Negotiation / Settlement Control Objective Accuracy of information in line with land/revenue records Nature of Work Step Verification Risk Non-compliance. Nature of Control Manual

1. Check whether the Land Officer confirmed the name of village, mouza, dag no., patta no., class of land etc., name of occupiers/ pattadars, etc. with land/ revenue records such as Chitha copy, Cadastral Land Map, etc. provided by the Contract Revenue Circle Office.

2. Check whether field visit is carried out by the Revenue Authorities for actual verification/ certification of individual Dag No., Patta No., Village Name, Mouza, area of land, class of land etc.

20.IA.1.2 Acquisition of land through Bipartite Negotiation / Settlement Control Objective Minimizing possibility of disputes with the occupiers/pattadars Nature of Work Step Verification Risk Delay in execution. Nature of Control Manual

1. Check whether written consent is obtained from the occupiers/ pattadars. 2. Check whether a formal letter asking for consent of the occupiers/ pattadars is available in case

of registered/corporate tea garden lands.

20.IA.1.3 Acquisition of land through Bipartite Negotiation / Settlement Control Objective Adequate assessment and subsequent accuracy in decision making Nature of Work Step Verification / Analysis Risk Inaccurate assessment. Nature of Control Manual

1. Check whether the Assessment Committee report is prepared and submitted to Land department with adequate supporting.

20.IA.1.4 Acquisition of land through Bipartite Negotiation / Settlement Control Objective Negotiation with land owners through liasoning officers Nature of Work Step Verification Risk Non-compliance to DOP Nature of Control Manual / Automated

1. Check whether there are any liasoning officer has been hired by OIL for negotiations with land owners.

2. Check whether a contract exists for the same and is approved as per DOP. 3. Check whether the payment is made to the officer as per the terms of contract. Use T-Code

FBL1N/FBL3N. 4. Check whether the payment made is capitalized along with the land value.

20.IA.1.5 Acquisition of land through Bipartite Negotiation / Settlement Control Objective Accuracy in payment and compliance to DOP Nature of Work Step Verification Risk Non-compliance to DOP. Nature of Control Manual

1. Check whether surface compensation is paid only after adequate approvals and documentation.

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20.IA.1.6 Acquisition of land through Bipartite Negotiation / Settlement Control Objective Minimizing possibility of disputes with the occupiers/pattadars Nature of Work Step Verification Risk Disputes. Nature of Control Manual

1. Check whether payment of surface compensation was made to all occupiers/ pattadars.

20.IA.1.7 Acquisition of land through Bipartite Negotiation / Settlement Control Objective Release of land as per timelines Nature of Work Step Verification Risk Delay in release of land. Nature of Control Manual

1. Check whether land release letter is issued by Land Department to Civil department as per the defined timelines.

20.IA.1.8 Acquisition of land through Bipartite Negotiation / Settlement Control Objective Adequate documentation to defend legal dispute Nature of Work Step Verification Risk Inadequate documentation. Nature of Control Manual

1. Check whether proper and correct land records are obtained from the Revenue Circle office.

20.IA.2.1 Acquisition of land through Land Acquisition Act, 1894 Control Objective Release of land as per timelines Nature of Work Step Verification Risk Delay in execution.

Nature of Control Manual 1. Check whether proposal for land acquisition is submitted to the Collector along with Land Maps

provided by Civil Survey Department on timely basis.

20.IA.2.2 Acquisition of land through Land Acquisition Act, 1894 Control Objective Accuracy in proposal for land acquisition Nature of Work Step Verification Risk Delay in execution.

Nature of Control Manual 1. Check whether proposal for land acquisition is reviewed and approved as per the defined DOP.

20.IA.2.3 Acquisition of land through Land Acquisition Act, 1894 Control Objective Release of land as per timelines Nature of Work Step Verification Risk Delay in execution.

Nature of Control Manual 1. Check whether there is a tracker maintained to monitor list of pending registrations. 2. Check whether there is a process for regular follow-up of the status of land acquisition.

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20.IA.2.4 Acquisition of land through Land Acquisition Act, 1894 Control Objective Accuracy and timely deposition of award amount Nature of Work Step Verification Risk Delay in execution.

Nature of Control Manual 1. Check whether upon intimation by the Collector, award amount is deposited within a

reasonable time after obtaining adequate approvals.

20.IA.2.5 Acquisition of land through Land Acquisition Act, 1894 Control Objective No un-accounted land Nature of Work Step Verification Risk Delay in execution.

Nature of Control Manual 1. Check whether entry of land acquisition is made in the Asset Register and General Ledger by

value of land including development cost. SAP T-codes for verification isAR01 and FBL3N.

20.IA.3.1 Acquisition of land under Provision of Forest (Conservation) Act, 1980 Control Objective Release of land as per timelines Nature of Work Step Verification Risk 1.Dispute.

2.Non-compliance. 3.Inappropriate costing.

Nature of Control Manual 1. Check whether the de-reservation proposal is submitted timely to the Nodal officer for seeking

approvals u/s 2 of the proposal by the State Government. 2. Check whether there is a tracker maintained to monitor list of pending registrations. 3. Check whether there is a process for regular follow-up of the status of land acquisition.

20.IA.3.2 Acquisition of land under Provision of Forest (Conservation) Act, 1980 Control Objective Accuracy and timely payment Nature of Work Step Verification Risk 1.Dispute.


Nature of Control Manual / Automated 1. Check whether upon intimation by the Nodal Officer, requisite payments are made through a/c

payees draft within a reasonable time. SAP T-code for verification is FBL3N.

20.IA.3.3 Acquisition of land under Provision of Forest (Conservation) Act, 1980 Control Objective Adequate documentation to defend legal dispute Nature of Work Step Verification Risk 1.Dispute.


Nature of Control Manual 1. Check whether land records obtained from Nodal Officer are uploaded in the Documentation

Management System in SAP.

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20.IA.3.4 Acquisition of land under Provision of Forest (Conservation) Act, 1980 Control Objective Appropriate land value payment and compliance to DOP Nature of Work Step Verification Risk 1.Dispute.


Nature of Control Manual 1. Check whether payment of land value is made after obtaining adequate approvals as per DOP.

20.IA.3.5 Acquisition of land under Provision of Forest (Conservation) Act, 1980 Control Objective Appropriate costing of land Nature of Work Step Verification Risk 1.Dispute.


Nature of Control Manual / Automated 1. Check whether cost associated in land acquisition such as legal costs, stamp duties, fees are

allocated, sanctioned and approved. SAP T-code for verification is FBL3N.

20.IA.3.6 Acquisition of land under Provision of Forest (Conservation) Act, 1980 Control Objective No un-accounted land Nature of Work Step Verification Risk 1.Dispute.


Nature of Control Manual / Automated 1. Check whether entry of land acquisition is made in the Asset Register and General Ledger by

value of land including development cost. SAP T-code for verification is AR01 and FBL3N.

20.IA.3.7 Acquisition of land under Provision of Forest (Conservation) Act, 1980 Control Objective Minimizing disputes for ownership of land Nature of Work Step Verification Risk 1.Dispute.


Nature of Control Manual 1. Check whether there is a process of monitoring and efficiently handling the legal cases/ RTI

queries.

20.IA.3.8 Acquisition of land under Provision of Forest (Conservation) Act, 1980 Control Objective Minimize encroachment of land Nature of Work Step Verification Risk 1.Dispute.


Nature of Control Manual 1. Check whether there is a process for review of occupancy of land acquisitioned by the Company

on a periodic basis.

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20.IA.4.1 Land records Control Objective Proper accounting of land Nature of Work Step Verification Risk Incorrect accounting. Nature of Control Automated / Manual

1. Check the type of ownership of land on a sample basis. 2. Ensure that if it is OIL owned land, then it is accounted in the books of accounts accordingly and

FAR is updated. 3. If it is leased land, check whether it is amortized during the leasehold period. 4. If it rented land, ensure that rent is paid accurately and timely. 5. Ensure that if change in type of ownership happens, then the records are updated timely and

accounting is done as per standards.

20.IA.4.2 Land records Control Objective Adequate data storage Nature of Work Step Verification Risk Inadequacy of documentation may result in disputes in future. Nature of Control Automated / Manual

1. Check whether land records obtained from Pattadars / Collector are uploaded in the Documentation Management System. The SAP T-code for verification is CV03N.

20.IA.4.3 Land records Control Objective No un-accounted land Nature of Work Step Verification Risk Incorrect accounting. Nature of Control Automated / Manual

1. Check whether entry of land acquisition is made in the Asset Register and General Ledger by value of land including development cost, legal fees and liasoning fees as per AS-10. The SAP T-code for verification is AR01 and FBL3N.

20.IA.4.4 Land records Control Objective Proof of ownership of land Nature of Work Step Verification Risk Legal implications. Nature of Control Automated / Manual

1. Check whether the safe custody of land ownership deeds is being maintained.

20.IA.4.5 Land records Control Objective Release of land as per timelines Nature of Work Step Verification Risk Delay in release of land. Nature of Control Automated / Manual

1. Check whether Joint SPP application is submitted at concerned Revenue Circle office and recommendation is submitted to DC’s office on timely basis.

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20.IA.5 Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material / service Nature of Work Step Verification Risk 1. Delays in payments.

2. Incorrect payments. Nature of Control Automated / Manual

1. Check whether status of work completion in manual records is updated as per contract terms. Use T-code ME2S/MSRV1.

2. Check whether confirmation or acknowledgement of work completed is taken from contractor on manual records.

3. Check whether the manual records are verified and approved by concerned authority. 4. Use T-Code ML84 to view the list of SES's and ML81N to view the details of specific SES. Check



contract w.r.t the actual date of completion/creation of SES. 8. 8. Check whether reasoning analysis is done for the delays and steps are taken to avoid similar

delays.







20.IA.7 Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Analysis / Verification Risk 1. Over/Under Utilization of manpower.




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21. Learning & Development – Internal Audit

Scope

Audit Areas

1 Need identification

2 Trainings - planning and execution

3 Compulsory and statutory trainings


5 PR tracking


7 Manpower planning

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21.IA.1Need identification Control Objective To ensure employees and organizational development. Nature of Work Step Verification Risk Non Adherence to Learning and Development policy. Nature of Control Manual

1. Check the adherence to the learning and development policy. 2. Check the periodicity of conducting skill gap analysis and competency mapping. 3. Check whether option of self-nomination is provided to employees for trainings and the same is

being used effectively for skill up gradation. 4. Check whether training needs of employees across all levels have been identified and discussed. 5. Check if the nominations for training is based on the need assessment and duly approved by

HOD.

21.IA.2.1 Trainings - planning and execution Control Objective To make employees more competitive,maintain incremental learning curve

for the organization. Nature of Work Step Verification/Analysis

Risk 1. Low participation level in employees. 2. Absence of training.

Nature of Control Automated/ Manual 1. Check whether training calendar have been formulated for the year / quarter. 2. Check whether training calendar is prepared on the basis of need identification and

organizational requirements considering the long term goals. 3. Check if the training calendar is approved as per the DOP. 4. Check whether the training plan is communicated and circulated well in advance. 5. Check any deviations from the defined calendar are approved and communicated in advance. 6. Check if the absence from training are properly documented and required approvals are

obtained by the employee for not attending the training. Use T-Code S_AHR_61016216. 7. Check is all the trainings are conducted as per the plan. 8. Check whether the training feedback is obtained, analyzed and considered for future planning. 9. Check if the training feedback is used to rate the trainer and use it effectively for future

planning. 10. Check whether any root cause analysis is being carried out for low participation level in the

trainings. 11. Check if process of evaluating the training benefits is followed. 12. Check the list of actual participants with the registered participants. Use T-Code

S_PH9_46000433. 13. Check if there are employees who have not been nominated for training for long period and

conduct reason analysis for same.

21.IA.2.2 Trainings - planning and execution Control Objective To make employees more competitive, maintain incremental learning curve

for the organization Nature of Work Step Verification/Analysis Risk 1. Unplanned payments made to the trainer.

2. Ineffective trainers reappointed repetitively Nature of Control Automated/ Manual

1. Check the process of identification, selection and payment to trainers. Use T-Code MIR4, FBL3N. 2. Check whether trainer’s past feedbacks are considered before reappointment of any trainer.

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21.IA.3 Compulsory and statutory trainings Control Objective To ensure awareness and compliance with statutory requirements


Risk Non-compliance with statutory trainings. Nature of Control Manual

1. Check the list of actual participants with the registered participants. 2. Check whether all the mandatory/ statutory trainings as per the MOU guidelines are scheduled

and conducted. 3. Check whether any root cause analysis is being carried out for low participation level in the

trainings.

21.IA.4 Planning and administration Control Objective To ensure appropriate cost of the trainings


Risk Inappropriate cost of training.


1. Verify the actual vs. budgeted amount sanctioned for the trainings. Use T-Codes S_ALR_87011761. Analyze the root cause for any significant variation in the budget vs. actual.

2. Check whether the expenses incurred by the department are in adherence to the documented company policy. Use T-Code MIR4, FBL3N.

3. Analyze the root cause for excess fund utilization than sanction for trainings. 4. Check on sample basis if the expenses are supported with adequate approvals and evidences. 5. Use T-Codes MIR4, FBL3N.

21.IA.5 PR tracking Control Objective Timely raising of PR and monitoring

Nature of Work Step Verification/Analysis Risk 1. Delay in procurement leading to costlier procurement/ stock out situations.

2. Delay in procurement leading to stock out situations causing operational delays.

Nature of Control Manual/ Automated 1. Use T-Codes ME53N and ME5A to check whether PRs for spares/materials/jobs are raised

timely. 2. Check whether approvals for PRs, issue of spares/materials and conducting jobs are taken as per


conducted for delays. 4. Check whether there is a process of reviewing pending PRs and whether a follow-up process


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21.IA.6.1 Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material / service


Risk Excess payment due to non-verification of the work done by contractor


1. Check whether manual records for work in progress and completed has been maintained by engineer in charge

2. Check whether service entry in SAP is made by EIC on a timely basis. 3. Check whether details from contractor are independently reviewed in line with the service

entry. 4. Check whether there is appropriate segregation of duty between the person releasing service

entry, verifying contractor invoice and approving payment. 5. Check whether service entry is approved by the EIC as per the Contract.

T-Code to check service entry in SAP: MSRV1, ME2S, ML81N 6. Check the manual records maintained by the EIC to monitor work in progress and work done by

the Contractor. 7. Understand the basis of the records. Eg: In case of paint job, whether area was measured by

the EIC. Whether the SE was based on the dimensions as per the approved drawing of location. 8. On a sample verify the measurement done.

21.IA.6.2 Creation of Service Entry Sheet (SES) Control Objective Timely payment to contractor

Nature of Work Step Analysis Risk Delay in payments to contractor Nature of Control Manual/ Automated

1. Analyze the time gap between Service execution, service entry and invoice verification. 2. Highlight the cases where unreasonable delays are noted.

21.IA.7 Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities. Nature of Work Step Verification/Analysis Risk 1. Over/Under Utilization of manpower.




Audit Checklist

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22. Legal – Internal Audit

Scope Audit Areas

1 Handling litigations

2 Legal compliance

3 Outsourced consultancy

4 Monitoring, tracking & vetting

5 PR tracking


7 Manpower planning

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22.IA.1 Handling litigations Control Objective Safeguard the reputation, financial loss and other business strategic

interest of the organization Nature of Work Step Verification/Analysis Risk 1. Loss of Reputation.

2. Financial Loss. Nature of Control Manual/Automated

1. Check whether dedicated personnel's / team have been identified to handle litigations.

2. Check whether trackers are maintained for the active and resolved litigations in chronological

order.

3. Check the amount of contingent liability (if any) reported and expected financial exposure.

4. Check the controls over out of court settlements and authorized Company's representative.

5. Map the amount authorized for the payouts for out of court settlement with actual payout. Use

T-Code MIR4, FBL3N.

22.IA.2 Legal compliance Control Objective Ensure awareness and compliance to statutory requirements Nature of Work Step Verification Risk Statutory Non Compliance. Nature of Control Manual

1. Check timely revert to the notices / representation of personnel in court as intimated.

2. Check the availability of the various statutory compliance checklists. Check whether checklists

are periodically updated, based on the changes in regulatory requirements.

3. Check whether the statutory compliance checklist used by various departments is vetted by

legal department.

4. Check if process is in place to ensure compliance of the legal requirements as communicated by

legal department.

22.IA.3 Outsourced consultancy Control Objective Safeguard the interest of the organization Nature of Work Step Verification/Analysis Risk Reputation of the organization at stake. Nature of Control Manual/Automated

1. Check the process to shortlist and selection of a consulting / law firm. Use T-Codes ME5A, ME2J,

ME2S.

2. Check whether background / reputation verification have been carried out before hiring a

consultancy / law firm.

3. Track timely response / service delivery by the consulting / law firms.

4. Check the terms & conditions to the contracts entered with the consulting / law firms. Use T-

Code ME3L.

5. Check the payouts to consulting / law firms with the contracts signed. Use T-Code MIR4, FBL3N.

6. Check whether contracting terms and condition have been updated based on the changes in

regulatory requirements. Use T-Code ME3L.

7. Check the amount of contingent liability (if any) conveyed by consultants/ law firm with the

amount reported.

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22.IA.4 Monitoring, tracking and vetting Control Objective Adequate documentation and approval mechanism Nature of Work Step Verification/Analysis Risk Inadequate Monitoring, tracking and vetting process. Nature of Control Manual/Automated

1. Check whether periodical monitoring, reporting and escalation of unresolved/pending

legal/arbitration cases is being carried out in chronological order.

2. Check the maintenance of the chronological order of events along with the checklist for each

legal case.

3. Check the maintenance of documentary proof and witness for the cases. Use T-Code CV03N.

4. Check the maintenance of list of vetted documents in chronological order. Use T-Code CV03N.

5. Check the maintenance of appeals filed / in process in chronological order. Use T-Code CV03N.

6. Check whether there is a process of obtaining feedback from legal department over various

terms and conditions used in contracting by other departments.

22.IA.5 PR tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Verification/Analysis Risk Delay in procurement leading to costlier procurement/ stock out situations/

operational delays. Nature of Control Manual/Automated





22.IA.6 Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Verification/Analysis Risk 1. Over/Under Utilization of manpower.




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22.IA.7 Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material/services Nature of Work Step Verification Risk 1. Delays in payments.

2. Incorrect payments. Nature of Control Manual/Automated

1. To check whether status of work completion in manual records is updated. Use T-code ME2S/MSRV1.




creation of SES. 6. Check whether the inspection carried out is approved as per DOP. 7. Check whether there is a process of monitoring the date of completion as mentioned in the


delays.

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23. LPG Plant - Internal Audit

Scope Audit Areas


2 Policy and procedures

3 LPG extraction

4 Identification and evacuation of defective cylinders

5 LPG filling and bottling

6 Dispatch of cylinders

7 PR tracking


9 Manpower planning

10 Compliances with HSE standards

11 Training of employees

12 Periodic audits & inspections

13 Statutory clearances and permission

14 Disposal of waste, hazardous chemicals and other by products

15 Handling safety issues

16 SOP Compliance



19 Safety


21 Security



24 HSE compliances

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23.IA.1 LPG - Planning, budgeting & monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,

compliance to DOP Nature of Work Step Analysis/Verification Risk 1. Inappropriate approvals.


1. Check whether the annual plan of administration department is complete and all-inclusive to

cover the requirements of all the activities that come under its purview.

2. In case, the plan and actuals are not updated in SAP, check manual documents.

3. Use T-Code KSBL and enter cost center to get budget.









23.IA.2 LPG - PR tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Verification/Analysis Risk Delay in procurement leading to costlier procurement/ stock out situations/






Audit Checklist

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24. Materials Management – Internal Audit

Scope Audit Areas

1 Budgeting

2 Material planning & monitoring

3 Operations

4 Purchase requisition

5 Purchase order

6 Vendor development and enlistment

7 Notice Inviting Tender (NIT)


9 Bid security


11 BEC/BRC

12 Two-bid system

13 Open tendering

14 Limited tendering/ Single tendering/ Emergency procurement

15 Spot purchases

16 Annual rate contract

17 Procurement of medicines

18 Receipt of bid

19 Opening of bid

20 Evaluation of bids, preparation of Tender Tabulation / Purchase Proposal Committee Resolution (TCR) and award & signing of the PO contract

21 Placement of order


23 Amendment to order

24 Follow-up

25 Replacement Supply

26 Receipt of material

27 Issuance of material

28 Demurrage

29 Storage

30 Scrap disposal

31 Insurance

32 DGCA permit and Explosives license

33 Monitoring of lead times from PR to PO issuance.

34 PR tracking



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24.IA.1 Budgeting Control Objectives Adequate budget planning, Effective monitoring over expenses, Compliance

to DOP Nature of Work Step Analysis / Verification

Risk 1. Inappropriate approvals. 2. Delays in preparation of budget. 3. Non compliance to DOP.


1. Use T-Code S_ALR_87013558 to check whether the annual budget of material department is complete and all-inclusive to cover the requirements of manpower, stationary, forklifts, stock racks etc.) etc.

2. Check whether annual budget is approved by competent authority as per DOP. 3. Check whether any amendments in annual budget is approved by competent authority as per

DOP. 4. Use T-code S_ALR_87013532 to obtain the overall budgeted and actual figures and use T-code


24.IA.2 Material planning & monitoring Control Objectives Adequate planning, effective monitoring over expenses, compliance to DOP,

avoid stock out situations Nature of Work Step Analysis / Verification

Risk 1. Inadequate planning for stock of different materials leading to stock out situation.

2. Proper updation of material master. 3. Operational delay.


1. Check whether there is classification of inventory between Vital, essential and desirable so as to avoid Excess/shortage of spares. Use T-Codes MM60. 2. Check whether annual plan prepared for procurement of stock items is complete and all inclusive considering the overall requirement of the user department/consumption patterns of previous 3 years. 3. Check whether monthly plan prepared for procurement of stock items is complete and all inclusive considering the overall requirement of the user department/consumption patterns of previous 3 years. 4. To ensure that there is adequate assessment of non-moving/slow-moving stock so that the

working capital doesn't get blocked. Use T-Codes MC46, MC50 (Dead Stock),MC.9. 5. Check whether any amendments in annual/monthly plan is approved by competent authority as

per DOP. 6. Check whether actual purchases are monitored / compared with planned annual/monthly plan on periodic basis. 7. To ensure that no unauthorized purchases are taking place due to indents not being approved.

Use T-Codes ME2B. 8. To conduct a walkthrough of the planning process. Ensure it is complete w.r.t analyzing current

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stock, upcoming demand/projects, past usage trend etc. 9. Check whether various inventory levels (minimum, maximum, safety stock etc.) have been defined for stock items to keep a control over stock items. 10. Check that there is availability of critical inventory / consumables for drilling

operations/production in order to avert operation delays. Use T-Codes MB52. 11. Check whether operation activities of user departments were stopped for a considerable period

of time due to any stock out situations. 12. Check whether materials planning is done based on factors used for material requirement

planning (MRP). 13. Check whether regular monitoring of annual/monthly plan for procurement of stock items and

exceptions are identified. 14. Check that only those who are authorized, access the material master. Use T-Codes SUIM. 15. Check whether economies of scale are adversely effected due to weak process of material

requirement planning and tracking. 16. Check whether exceptions in planned vs. actual are analyzed and root cause is identified for such

exception so as to take necessary actions against it.

24.IA.4.1 Purchase requisition Control Objectives Adequate information readily available for procurement, accuracy in

accounting, compliance to DOP Nature of Work Step Verification

Risk 1. Non-compliance to DOP. 2. incomplete / incorrect PR.


1. Use T-Code ME53N, ME5A to check whether the PR for stock items is raised as per the process mentioned in Purchase Manual. 2. Check whether PRs are raised within the budgetary limits allocated to the department and approvals on PRs are obtained as per DOP. 3. Check whether PR is accompanied with complete details as required by Purchase Manual such as detailed of quantity, cost, required at site date, budget provisions & management approvals, detailed technical specifications, the approved BRC/BEC, last purchase reference, requirement of sample/drawings, weight of item etc. 4. If invitation of bid is to be done on limited bid/single bid/proprietary single bid /emergency bid basis, to check PR is approved accordingly as per defined DOP. 5. Check whether PRs raised are completed in order to avoid delays due to incompleteness / incorrectness of PR. 6. Check whether there is a maker checker control for preparation and release of PR. 7. Check whether pending purchase requests are reviewed and necessary actions/follow ups are

done internally or externally. 8. Check whether technical/budget sanction is as per the Purchase Manual and approved as per the defined DOP. 9. Check whether PRs for non-stock/capital items are timely re-validated by Planning section to avoid delays due to incompleteness / incorrectness of PR.

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24.IA.4.2 Purchase requisition Control Objectives To verify that the indents are not raised for materials already in stock

resulting in accumulation of inventory in excess of requirement. Nature of Work Step Analysis / Verification

Risk 1. Blockage of working capital. 2. Accumulation of inventory items which may expire or become obsolete.


1. Generate list of Requisitions using T-Code ME5A for the review period. 2. Check the stock of material requisitioned on the date of Requisition using t code ZMM_STOCK

and MB5B. 3. Check the stock available on PR date and the movement of material during the selection period

to find if the material was available as unrestricted stock. 4. If the stock is available on the PR date, find the reasons why PR was raised and report it.

24.IA.4.3 Purchase requisition Control Objectives To verify that material requisitioned was actually consumed as per plan


Risk 1. Blockage of working capital. 2. Accumulation of Inventory items which may expire or become obsolete.


1. Use T-Code T-Code MB51 to generate list of material received for the period. 2. Analyze the list of materials which are received & not being issued (consumed) as per the plan. 3. Discuss the reasons with requisitioner as to why the material is not consumed as per plan, report

any deviations.

24.IA.4.4 Purchase requisition Control Objectives To verify that requisitions for materials with high lead time are raised on time


Risk 1. Adoption of emergency procurement methods may result in procurement at higher costs &unfavorable terms & conditions.

2. Unavailability of material at the requirement may result in disruption of operations.


1. Verify whether standard lead times for material have been defined using MM03. 2. Verify using ME5A whether the same have been considered by requisitioner while raising the

purchase requisition (by comparing lead times defined in PR & Material Master). 3. Discuss & report the cases where the time given to MM department for procurement of material

is less than the standard lead time defined in the system.

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24.IA.4.5 Purchase requisition Control Objectives To verify existence & implementation of procedures for monitoring of

pending requisitions & orders


Risk Delay in procurement of material / services may result in disruption of operations.


1. Generate a list of pending requisitions using T-Code ZMMPRFOLLOWUP - PR follow-up report. 2. Generate a list of pending orders using ME5A & ME2N (filter using delivery dates as a basis to

identify overdue requisitions & orders). 3. Analyze the long pending cases in discussions with MM department & Process owner. Ensure

that PR's that are not required are deleted. 4. Understand the criticality of the requirement, its impact on operations and report any

observations.

24.IA.4.6 Purchase requisition Control Objectives To verify whether economy of scale is attempted by clubbing multiple

requirements for similar material / services


Risk Finalization of order on uncompetitive terms & conditions.


1. Generate ME2N for the review period. 2. Analyze the orders for same material / services within a short span. 3. Report cases where:

a. Same material / service has been procured at differential price b. Where opportunity of obtaining the bulk quantity discount could have been levered.

24.IA.5.1 Purchase order

Control Objectives Monitoring of POs


Risk Inadequate monitoring of open Pos.


1. To ensure that there's a process monitoring of emergency PO's so as to reduce the cost of procurement.

2. To ensure there 's adequate 3-way match procedure such that correct payment is made. Use T-Codes MB5S & ME2N.

3. To ensure that there's no delay in procurement due to non-monitoring of Open PO's. Use T-Codes MB5S & ME2N.

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Control Objectives To verify that the Non-proprietary items are not purchased as proprietary item to avoid tendering process.


Risk 1. Finalization of order on uncompetitive terms & conditions. 2. Increased dependency on limited no. of vendors.


1. Generate a list of Orders awarded on Proprietary basis using T-Code ME2N. 2. Verify availability of proprietary certificate against each order. 3. Analyze of the validity of the certificate and report any observation.


Control Objectives To verify that any order is not awarded to any black listed vendor


Risk 1. Finalization of order on uncompetitive terms & conditions. 2. Delay in procurement of material / services which may result in

disruption of operations. 3. Procurement of material / services which do not match the

requirement. Nature of Control Manual / Automated

1. Obtain the list of black listed vendors. Use SAP T-Code S_ALR_87012179, enter the company code and select check box "Only with posting block".

2. Generate a ME2N / ME3N for the period giving list of orders awarded during the review period. 3. Analyze these reports to verify if any order is given to any blacklisted vendor, after the date of

blacklisting.


Control Objectives To ascertain whether same material / services are being availed at differential prices during a short span of time


Risk Finalization of order on uncompetitive terms & conditions.


1. Generate ME2N for materials and services. 2. Analyze whether same material/ services have been procured / availed at differential prices

within short span of time both from same or different vendor. 3. Verify if any Rate contract exists for any material / services which is procured through One Time

Orders using T-Code ME33K. 4. Do the similar rate comparison with the same material / service procured across different

spheres / Projects / Branch offices within short span of time. 5. Discuss the reasons for variances with MM department and report any observations.

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Control Objectives To verify that procurement is done only for uniquely codified materials


Risk 1. Finalization of order on uncompetitive terms & conditions. 2. Procurement of material with wrong specifications. 3. Distortion of procurement history database.


1. Obtain list of purchase orders and verify if there is any line item without material code. 2. Further analyze list of services availed during the period using T-Code MSRV1. and find any cases

where material has been procured through work order. 3. Discuss the exceptions with MM department.


Control Objectives To verify that the adequate taxes have been paid on the procurement of goods / services


Risk Statutory non compliance leading to penal consequences.


1. Use Transaction ME2N to see the list of orders. 2. Check the orders for correct taxes as per the applicable rates. 3. Obtain the reason for exceptions and report the same.


Control Objectives To verify that there is segregation of duties for creation of order / contract and approval of order / contract.


Risk 1. Unauthorized procurement of material / services. 2. Procurement of material / services in excess of requirement. 3. Finalization of order on uncompetitive terms & conditions.


1. Check with Administrator / SAP Basis Team for the list of users who have authorization to create Order / contract by using T-Code ME21N, ME31, ME31L, ME31K and users who have authorization to release the order / contract at different authorization level.

2. Check if the same user does not have both creation and approval roles. 3. Discuss & report any observation.

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24.IA.6 Vendor development and enlistment Control Objectives Compliance to Purchase Manual, competitive pricing leading to cost

advantage to the Company Nature of Work Step Verification

Risk 1. Non-compliance to Purchase manual. 2. Inappropriate approvals. 3. Uncompetitive procurement due to no vendor development.


1. Check whether list of approved vendors is prepared and updated on regular basis against the materials.

2. To ensure that there is no overdependence on sole supplier due to non-identification of alternate vendors. Use T-Codes ME2L.

3. Check whether any inclusion/ deletion of a new vendor is approved as per DOP. 4. Check whether the vendors are enlisted through flagging of tenders only if they meet the

qualifying criteria as mentioned in the Purchase Manual. 5. Check that potential vendors who submitted applications after a period from the date of

publication of tender is not considered for enlistment through flagging. 6. Check whether the vendors are enlisted through trail orders only if they meet the qualifying

criteria as mentioned in the Purchase Manual. 7. Check whether trial orders are raised only in situations as mentioned in the Purchase Manual. 8. Check whether trial orders are not raised for specific items mentioned in the Purchase Manual. 9. Check whether techno-commercial analysis is done as per the process mentioned in the

Purchase Manual, before raising a PR for trial order. 10. Check whether PR for trial order is raised timely as per the process mentioned in the Purchase

Manual and approved as per DOP. 11. Check whether the payment for materials received for trial order is made after material testing

and its acceptance. 12. Check whether payment for trial order is made to potential vendor in case of delayed trials after

lab testing/ documentary evidence against the bank guarantee. 13. In case the payment needs to be made without a bank guarantee, ensure necessary approvals

are obtained as per DOP. 14. To ensure that there's presence of key terms & conditions in the contract, PO and ratification by

the legal department to avert vendor disputes. 15. To ensure that there's authorized access to vendor master. Use T-Codes SUIM. 16. To ensure the presence of vendor appraisal process. Use T-Codes ME6H. 17. Check that the vendor name is enlisted on acceptance of materials received for trail order.

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24.IA.7 Notice Inviting Tender (NIT) Control Objectives Competitive bidding, completeness of tender document, safeguarding

interest of the Company Nature of Work Step Verification

Risk 1. Incompleteness of notice inviting tenders. 2. Inadequate documentation in contract file.


1. Check whether NIT are timely sent to PR Public Relation department for approval. 2. Check whether follow up is done with the PR department for timely publication of

advertisement. 3. Check whether copies of newspaper is documented in contract tender file. 4. Check whether completeness of the notice inviting tenders (whichever applicable) is ensured in

terms of its content e.g. Tender Number, Brief description and quantity of material required, Bid closing date and date of opening of tender, Addresses from where the tender documents are available for sale, Amount and mode of payment of tender fee, Starting and closing date of sale, Other terms and conditions, if any, The web site address of Oil India Ltd, as mentioned in the Purchase Manual.

5. Check whether the tender forms are serially numbered.

24.IA.8.1 Sale of bidding document Control Objectives Accuracy in amount received through sale of bid document


Risk 1. Inadequate process of collection of money raised through bid document.


1. Check whether a bid document fee is charged for the sale of bid documents as per the Purchase Manual.

2. Verify that the sale of bid document is recorded in the bid register along with their address, cheque number and whether the bidder is a Government Department or registered with NSIC. The SAP T-Codes for checking tender fee amount and tender received is ZMMTENFEE3 / ZMMTENDER3.

3. Check whether appropriate supporting are taken from the bidders exempted from paying the bid document fee i.e. Government Department or registered with NSIC.

4. Check whether the total amount collected from sale is reconciled with the total number of bid documents sold.

5. To verify that the proper accounting of the tenders sold and unsold is done. 6. To verify that no sale of bid document is done after last day of tendering sale closing date. 7. Check whether there is a process of monitoring the collections made through sale of bid

document w.r.t the bid documents sold. 8. Check whether reconciliation between money collected and total number of bid documents sold

is done. 9. Check whether the tender documents are mailed as per the process mentioned in the Purchase

Manual and after approval as per DOP. 1. 10. Obtain the list of black listed vendors. Use SAP T-Code SE16N (LFA1 Table) to get list of

vendors for posting block and purchasing block. Check that no tender documents are sold to parties who have been suspended/banned i.e. blacklisted by any sphere of OIL.

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24.IA.8.2 Sale of bidding document Control Objectives To verify that the extension of bid entering date is authorized in

writing by the competent authority.


Risk Non compliance to DOP / MM Manual may result in unauthorized procurement of material/ services.


1. Check for the tenders for which bid entering date was extended. 2. Check if the competent authority has approved the extension as per DOP/MM MANUAL. 3. Obtain the reason for exceptions and report the same.

24.IA.9 Bid security

Control Objectives Assuring collection or return of bid security as per Purchase Manual


Risk 1. Non-adherence to purchase manual.


1. Check whether Bid security is obtained as specified in the bid document. 2. Check whether bid security is only received in the form bank guarantee, bank draft, banker's

cheque or irrevocable letter of credit. Ensure it has been kept in safe custody. 3. Check whether exemption of bid security has been made in compliance to the Purchase Manual. 4. Check whether bid security is released only as per the terms mentioned in the Purchase Manual. 5. Check whether bid security is returned to the bid winner only after performance security has

been received. 6. Check whether bid security is forfeited in case of withdrawal of bid within the validity period or

non-acceptance of offer made.

24.IA.10 Pre-bid conference

Control Objectives Compliance to Purchase Manual, Transparency in process


Risk 1. Legal hurdles resulting from non-transparent process being followed. 2. Non-compliance to purchase manual.


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1. Check whether pre-bid conference is held only after approval from competent authority. 2. Check whether only the parties who had bought the Bid Documents are invited to attend the

Pre-bid Conference. 3. Check whether senior most officer from the Indenting Department along with the representative

from Materials Department and Finance is present at the Pre-Bid Conference. 4. Check whether the minutes of the meetings are prepared and signed off by all the attendees. 5. Check whether the changes made, if any in PBC are approved by competent authority and

communicated to the bidders through fastest means of communication. 6. Check whether new bidders are invited for participation only if there is any major change in the

qualifying criteria. 7. Check if approval is taken as per DOP in case the sale of bid documents is initiated again.

24.IA.12 Two-bid system

Control Objectives Competitive bidding, compliance to contract manual


Risk 1. Non-compliance to contract manual. 2. Non-adherence to process of two bid system.


1. Check whether two part-bid system (Un-priced Technical Bid and Price Bid separately) is used as required in Purchase Manual.

2. Check whether in the two bid system, the price envelope is opened only after opening of technical bid and opening of price bid is approved as per DOP.

3. Check whether only the bids that have been quoted within the time period as specified in the bid document are considered as valid.

4. Check whether the price Bids of the Techno-Commercially rejected parties are stored for one year after finalization of the tender.

24.IA.13 Open tendering

Control Objectives Timely bidding, allowing eligible vendors for bidding, time bound bidding


Risk 1. Non-adherence to purchase manual/DOP.


1. Check whether approval for adoption of open tendering process is taken as per DOP. 2. Check whether open tendering system is used as required in Purchase Manual. 3. Check whether the date of PR release, with the date of e-tendering initiation and the date of

vendor code creation for the same are mapped and reasons are recorded for delay. 4. Check whether for open bidding, advertisement is published on OIL website and Press as

required by the Purchase Manual.

24.IA.14 Limited tendering/ Single tendering/ Emergency procurement Control Objectives Compliance to DOP, availing emergency services procurement, time

bound bidding Nature of Work Step Verification

Risk 1. Non-adherence to purchase manual/DOP. 2. Inappropriate approvals.


1. Check whether there is a process to maintain a database with details of all the contracts / PO made through single tender contract and reasons are provided for the same.

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2. Check whether approvals are obtained as per DOP for entering into the selected method of bidding.

3. Check whether for single bid, either the certificate for emergency approved by DOP or the proprietary certificate is present.

4. Check whether quarterly report on nomination orders is submitted to CVO,CBC, Board (whichever applicable) as required by the Purchase Manual.

5. Check whether the bidding process is open only till the time period mentioned as per the Purchase Manual.

6. Check whether the emergency procurement is regularized timely and as per the process mentioned in Purchase Manual.

24.IA.15 Spot purchases

Control Objectives Compliance to DOP


Risk Non-compliance to DOP.


1. Obtain the list of spot purchase orders by using T-Code ZMMPOValue. Obtain the list of Spot Purchase Requisition by using T-Code ME5A.

2. Check whether spot purchases are made only for items less than Rs. 10000 or the limit as specified in DOP.

3. Check if the Spot wing of the Materials department has an updated list of vendors for spot purchases.

4. Check whether there is bias is placement of spot orders. 5. Check whether orders are placed on piece-meal basis to procure the item through spot

purchase. 6. Check whether a committee is constituted for spot purchases of items that are highly design

oriented and aesthetic. 7. Check whether minimum 3 quotations are invited from enlisted OIL vendors. 8. Check whether emergency purchases are finalized by a committee formulated for the same.

Check PR list using ME5A (filter by PR type).

24.IA.16 Annual rate contract Control Objectives Compliance to DOP




1. Use T-Code ME3L and check whether annual rate contracts have been finalized for proprietary spares as mentioned in the Purchase Manual.

2. Check whether necessary approvals are obtained as per DOP. 3. Check whether the contract is only valid for a period of 2 years (whether the contract is

extended for another year after the requisite approvals). 4. Check whether annual rate contracts are utilized and no tender is processed for items for which

annual contract is present.

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24.IA.17 Procurement of medicines Control Objectives Timely procurement of medicines, avoid procurement of fake

medicines Nature of Work Step Analysis / Verification

Risk 1. Inadequate process for procurement of medicines.


1. Use T-Code ME53N and ME5A to check whether the PR raised for medicine by the Medical department is certified by Drug Purchase Committee. Use the T-Code ZMMPOVALUE to obatin the list of PO.

2. Check whether the PR raised mentions the manufacturers name against each medicine to be procured.

3. Check whether the Materials department timely requests the manufacturer to provide details of distributors in nearby areas as mentioned in the Purchase Manual.

4. Check whether follow up mechanism exists to procure the quotations in order to avoid delay and enhance competition.

5. Check whether rate applicable to the Hospital/ Institutional sale are considered as per the current price list.

6. Check whether the contract is awarded to the party offering highest discount subject to their fulfillment of other terms and conditions of the NIT.

7. Check whether payment is made as per current price list meant for Hospital / Institutional sale at the time of delivery considering discount offered by the supplier.

8. Check whether a letter is obtained from the manufacturer certifying that medicines supplied have been manufactured by the manufacturer mentioned in the package and the medicines covered in the supply lot have shelf life of half the total shelf life period at the time of receipt.

9. Check whether quality of the supplied medicines is periodically tested on random basis through reputed laboratories.

24.IA.18 Receipt of bid

Control Objectives Segregation of duties, Bids in lock in key


Risk 1. Improper safeguarding of bids.


1. Check whether the bid closing date, if extended is done as per the terms and procedures mentioned in the Purchase Manual.

2. Check whether the Bids are deposited by the bidders in the Tender Box kept at the designated office of OIL, received by ordinary/registered post/courier/Speed post or handing them over to the Officer in charge of receiving the bids in case the numbers of bids are voluminous.

3. Check whether tender Box is always kept locked by two locks and key of one lock is under custody of Purchase office and key of other lock is with the designated officer of Accounts Office.

4. Check whether bids received by ordinary/Regd. Post/personally are handed over to Dispatch Section and recorded in a register maintained at dispatch section.

5. Check whether E-mail / fax / telex / telegraphic/telephonic bids are accepted only when specifically asked for in writing.

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24.IA.19 Opening of bid Control Objectives Tracking of bid documents


Risk 1. Improper tracking of bid documents.


1. Check whether the attendees present at the time of opening the bids are only bidders / authorized representative of bidders.

2. Check whether a letter of authority has been submitted along with the copy of tender in case, an authorized representative is attending the meeting.

3. Check whether the bids received are serially numbered and envelops are preserved. 4. Check whether Bid officers presented at the time of opening of Bid have signed against the

name of firms who’s Bid has been received and to sign against all changes/amendments/addition etc. made as mentioned in the Purchase Manual.

5. Check whether certificate of compliance and bid security are furnished by the bidders.

24.IA.20 Evaluation of bids, preparation of Tender Tabulation / Purchase Proposal Committee Resolution (TCR) and award & signing of the PO contract

Control Objectives Selection of competent supplier contractor


Risk 1. Selection of incompetent supplier contractor. 2. Inadequate documentation.


1. Use T-Code ME49 to check whether comparative statement including FOB/FCA charges is prepared as per the Purchase Manual and approved as per DOP.

2. Check whether the evaluation of the bid is done as per evaluation criteria, technical and commercial evaluation reports, BEC/BRC including bidder’s qualification requirements and cost compensating the deviations taken by the bidders.

3. Check whether more than one person is involved in finalization of PO/ Contract. 4. Check whether a rejection report with complete details as mentioned in the Purchase manual is

prepared timely. 5. Check whether the Purchase Proposal is approved and communicated to the bid winner within

the bid validity period. 6. Check whether the detailed PO contract is signed within two weeks of notification of award of

Contract (LOA/LOI).

24.IA.21 Placement of order

Control Objectives Timeliness and accuracy in placement of order, Inclusion of standard terms and conditions


Risk 1. Inappropriate approval. 2. Non-Inclusion/adherence of standard terms and conditions.


1. Check whether the LOA is sent timely through FAX/Courier/ Email for cases where validity of recommended bidder is going to expire prior to expected receipt of formal order by the party in order to freeze the rates.

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2. Check whether the LOA seek submission of Performance bank guarantee. 3. Check whether the formal order complete with Techno-Commercial specification, testing/

inspection requirements and commercial terms and conditions etc. and General terms and conditions of Purchase Order, is issued timely to the winning bidder.

4. Check whether bidder refusing the acceptance of LOA has been debarred and the bid security has been seized.

5. Check whether the bid security is released only after deposit of performance security. 6. Check whether the order for foreign/indigenous procurement includes salient terms as

mentioned in the Purchase Manual. E.g.: Insurance, CIF, FOB, weight of consignment, Buy right now (BRN)/ Buy right here (BRH) etc.

7. Use T-Code ME23N, ME2N and ME2S to check whether the Purchase Order/ Formal offer is signed and approved as per DOP.

8. To ensure that the price mentioned in the PO is same as that mentioned in the bid.

24.IA.22 Performance guarantee Control Objectives Assuring collection or return of performance guarantee as per

Purchase Manual Nature of Work Step Analysis / Verification

Risk Non-receipt of performance guarantee.


1. Check whether the performance guarantee is collected timely from the bidder as per the Purchase Manual. Also, check if the performance guarantee was extended/renewed as required.

2. Check whether the performance guarantee is returned only after NOC is received from the user department and warranty obligations have been fulfilled.

3. Check whether in case of invocation of performance security, proper reasoning is done and approval is taken as per DOP.

4. Check whether performance security is not returned if order for invocation is passed.

24.IA.23 Amendment to order Control Objectives Compliance to Purchase manual and DOP


Risk Inappropriate approval.


1. Check whether the amendment made w.r.t PO (payment term, packing, quantity, mode of dispatch etc.) is approved as per DOP.

24.IA.24 Follow-up

Control Objectives Timeliness in delivery of materials


Risk Untimely delivery of materials.


1. Check whether there is a database to monitor the expected date of receipt of materials. 2. Check whether there is a process to follow-up with the supplier advising them for execution of

orders falling due after two months. 3. Check whether a list of major suppliers has been maintained and updated. 4. Check whether monthly follow up is done with these suppliers regarding pending orders.

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5. Check whether the responses are recorded and reviewed by concerned dealing officer for further action.

6. Use T-Code ME2N/ME5S , then check "Still to be delivered" quantity, if this value is not zero then it is open PO. Check whether there is a process of monitoring open POs and closing them timely, if required.

7. By using T Code FBL3N, generate the DR (Discrepancy) report and discuss with department long pending issues.

24.IA.25 Replacement Supply Control Objectives Timely action to avoid financial loss to the Company Nature of Work Step Analysis / Verification

Risk Financial Risk.


1. Check whether claim for replacement is filed timely with the supplier as per the process mentioned in Purchase Manual.

2. Check whether the defective ordered item is returned to the supplier only after obtaining adequate bank guarantee.

3. Check whether the defective ordered item is replaced without a bank guarantee only after taking approval as per DOP.

4. Check that Materials department informs GM(F&A) timely for filing of insurance claim, in case of no response from supplier.

24.IA.26.1 Receipt of material Control Objectives Timely and accurate receipt of material


Risk Operational risk with late receipt of material/inaccurate receipt of material.


1. Check whether the entry pass and delivery note for the materials received is initiated timely by the Materials Department.

2. Check whether the delivery note prepared is complete. 3. Check whether the quality of the material is up to the mark. The SAP T-Code is MCXE. 4. Check whether there is timely inspection from user department. The SAP T-Code is MB51. 5. Check whether all the relevant documentation like delivery note, invoice, test proprietary

certificate etc. is sent by the Materials department to the user department timely. 6. Check whether intimation regarding the unloading point of non-stock items is received timely

from the user department. 7. Check whether the GRN is prepared immediately on receipt of note from user department

confirmed no exceptions. 8. Check whether the material received is unloaded timely. 9. Check whether there is a process to monitor the delay between receipt of material and GRN

creation taken to avoid similar delays in future. 10. Check whether reasoning analysis is done for the delays and steps are taken to avoid similar

delays. 11. Check that receipt of material is directly at site. The SAP T-Code is MB51. 12. Check whether the receiving of material is done in the presence on CISF, representatives from

Materials and user department.

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24.IA.26.2 Receipt of material Control Objectives To verify that GRN is done for the right quantity of goods


Risk 1. Payment may be released to supplier for sub standard delivery. 2. Disruption in operation due to non availability of material. 3. Delay in updating an inventory ledger or creation of GRN. 4. Sub standard delivery may get accepted as standard delivery.


1. Check if the company has defined policies and procedure for receiving material and recording receipt information at the gate.

2. Check if the SAP system permits creation of GRN without Gate entry in the system. Display Gate Entry ZMMINWARD3.

3. Check if the goods have been received as per the PO quantity, rate, description, terms etc.4. Weighment / Counting controls:

a. Whether the receiving section has a weighment bridge. If not, whether the security accompanies the truck to the external weighment bridge.

b. Whether shortage is accurately recorded or not. 4. Check whether the tolerance limits are defined for materials wherever applicable. 5. Discuss and report any observations.

24.IA.26.3 Receipt of material Control Objectives To verify that the Inward entry is done before GRN


Risk Inability to track gate entry time and GRN time separately may hamper the delivery monitoring system.


1. Check if the company has defined policies and procedure for receiving material and recording receipt information at the gate Display Gate Entry ZMMINWARD3.

2. Check if the SAP system permits creation of GRN without Gate entry in the system. 3. Discuss & report any observations.

24.IA.26.4 Receipt of material Control Objectives To verify that there is no delay for GRN once the Inward entry is done.


Risk 1. Inability to track gate entry time & GRN time separately may hamper the delivery monitoring system.

2. Delay in updation of stock may lead to delay in issue of material to process & operations may suffer.


1. Obtain GRN dump from the system. Use T-Code MB51. 2. Compare GRN creation date with GRN / gate entry date to identify cases of delay in creation of

GRN. 3. Discuss and report any observations.

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24.IA.26.5 Receipt of material Control Objectives To verify in case of partial delivery , the follow up for reasons &

remainder of order with supplier is done.


Risk 1. Disruption in operation due to non availability of material. 2. Extra financial outlay for multiple trips by truck.


1. Use T-Code ME2N for list of Purchase orders along with balance quantity to be delivered. 2. Check whether adequate follow up / correspondence with vendor for pending. 3. Obtain the reasons for under-delivery and report the same. 4. Discuss & report any observations.

24.IA.27 Issuance of material Control Objectives Authorized issue


Risk Unauthorized issue leading to control risk


1. To ensure that there's authorized issue of material in accordance with segregation of duties between personnel responsible for ordering, receiving and issue of material. The SAP T-Code is SUIM.

2. To ensure correct valuation of inventory for material issued, and timely updation in SAP. The SAP T-Code is MM60.

24.IA.28 Demurrage

Control Objectives Avoid unnecessary demurrage charges


Risk Inadequate Reasons, corrective actions and quantum of payment of demurrage.


1. Check whether there are instances in which demurrage has been incurred by the Company. 2. Check if negotiation has been carried out with the concerned authority regarding relaxation of

demurrage charges. 3. Check whether demurrage is paid only after approval as per DOP. 4. Check if reasoning analysis is available as to why demurrage has taken place and corrective

actions have been initiated to avoid the same.

24.IA.31.1 Insurance

Control Objectives To verify that the insurance spares are identified separately.


Risk Non availability of material at the time of requirement may lead to disruption in operations resulting in financial losses.


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1. Identify insurance spares from material register / master. 2. Review of insurance spares on sample basis and check that approvals are taken. 3. Review the criticality of spares based on the discussion with maintenance HOD and Identify the

cases where non-critical spares are declared as insurance spares. 4. Discuss and report any deviations.

24.IA.31.2 Insurance

Control Objectives To review monitoring procedures for insurance claims


Risk 1. Delay in claiming insurance may result in non receipt of claim. 2. Delay in receipt of claim may result in blockage of working capital.


1. Obtain list of goods damaged. 2. Verify whether insurance is available for such goods. 3. Check whether the claim are filed on timely basis. 4. Obtain a list of pending insurance claims. 5. Inquire reasons for delay in filing and finalization of claims. 6. Discuss & report any observations.

24.IA.32 DGCA permit and Explosives license Control Objectives Statutory Compliance


Risk Non Compliance to statutory requirements.


1. Check whether procurement of explosives and radioactive materials is done in compliance with Purchase Manual and Statutory Guidelines.

2. Check whether application for DGCA permit/explosives license/NOC from BARC is filed immediately after completion of the Techno-Commercial scrutiny, with the concerned government departments after approval as per DOP.

3. To ensure compliance to regulatory laws and regulations. 4. To ensure there is no delay in renewal or expiry of various licenses. 5. Check whether there is a process of follow-up with the concerned departments/organizations

for granting of licenses/permit.

24.IA.33 Monitoring of lead times from PR to PO issuance. Control Objectives Timely award of contracts


Risk Delays in finalizing contracts


1. Check whether the time taken in converting PR to PO for each stage is being monitored by Materials Department.

2. Analyze the lead time taken for each stage from PR to contract and report the cases of exceptional delays.

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24.IA.34 PR tracking Control Objectives Timely raising of PR and monitoring


Risk Delay in procurement leading to costlier procurement/ stock out situations / operational delays.






24.IA.35 Manpower planning Control Objectives To ensure manpower is adequate for all the departmental activities


Risk 1. Over/Under Utilization of manpower. 2. Operational delays caused due to low manpower.




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25. Medical – Internal Audit

Scope

Audit Areas


2 Empanelment of hospitals

3 Patient registration

4 Billing for Entitled patient / Non entitled patient (NEP)

5 Receiving, storage and issuance process of drug

6 Patient's feedback and action plan

7 Regulatory and Statutory compliance


9 Training

10 Claims

11 Service

12 PR tracking



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1. To check whether the annual plan of Medical department is complete and all-inclusive to cover

the requirements of medicines, medical equipment, new medical facilities, CSR activities etc.

Use SAP T-codes KSBL and enter cost center to see planning overview.

2. To check whether any amendments in annual plan is approved by competent authority as per

DOP.

3. To check whether annual plan is approved by competent authority as per DOP.

4. To check whether actual expenses are monitored / compared with planned expenses on

periodic basis. Use SAP T-codes S_ALR_87013532/ S_ALR_87013558 and enter cost center.

25.IA.2 Empanelment of hospitals Control Objective Reputed hospitals have been empanelled Nature of Work Step Verification Risk 1. Unsatisfactory medical services.

2. Non-availability of tax exemption certificate for the hospital may lead to payment of addition tax by employee.

Nature of Control Manual 1. Check the process of empanelment of hospitals.

2. Ensure that adequate market research has been done and documented.

3. Check whether the empanelled hospitals have been approved as per DOP.

4. Ensure that tax exemption certificate is collected from the empanelled hospitals by the Medical

department.

5. Check whether the hospital rate chart has been taken and documented.

25.IA.3 Patient registration Control Objective Accurate patient details, Complete documentation & No duplicate patient ID Nature of Work Step Verification/Analysis Risk 1. Inaccurate patient details.

2. Incomplete documentation.

3. Duplicate patient ID. Nature of Control Manual/Automated

1. To check whether patient master is maintained in Hospital Information System (""HIS"")/SAP

application.

2. To check whether important details like name, unique patient ID, address, age, family members

(dependents) etc. are recorded in case of Entitled patient and Non Entitled patient.

3. To ensure correct completion of registration form.

4. To check whether any duplicate patient ID exist.

5. To ensure that only a registered user is authorized.

6. To check whether patient details mentioned in the master are aligned with the details given in

hardcopy records maintained by the department.

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25.IA.4 Billing for Entitled patient / Non entitled patient (NEP) Control Objective Accurate billing Nature of Work Step Verification/Analysis Risk 1. Financial risk.

2. Non Compliance to DOP. Nature of Control Manual/Automated

1. To conduct a walkthrough of the billing process and identify the gaps in process.

2. To check whether invoice is raised for NEP patient and approved by competent authority as per

DOP.

3. To check whether invoice (No value invoice) is raised for NEP patient and approved by

competent authority as per DOP.

4. To check whether billing done for Non entitled patient (""NEP"") is accurate in terms of rates

specified in rate circular, services provided to NEP and applicable local taxes if any.

5. To check whether segregation of duties is maintained in billing process.

6. To check whether billing done for Non entitled patient (""NEP"") is accounted for in HIS/SAP.

7. To check whether reconciliation of 'HIS's billed amount is done with SAP records on regular

basis. Use T-code FBL3N and enter G/L code.

25.IA.5 Receiving, storage and issuance process of drug Control Objective Avoid stock out of medicines, Avoid or minimize pilferage/loss of medicines &

Avoid or minimize loss on account of expired medicines Nature of Work Step Verification/Analysis Risk 1. Stock out of medicines leading to operational delays.

2. Pilferage/loss of medicines.

3. Loss on account of expired medicines.

Nature of Control Manual/Automated 1. To conduct a walkthrough of receiving and issuance of medicines / medical equipment.

2. To check whether on receipt of medicines, medical equipment; GRN is created in SAP and the

same is reflected in 'HIS'. Use SAP Code MB5B, MB52 and enter plant code to see inventory

levels.

3. To check whether physical inspection of medicines, medical equipment received in store is done

by receiver/store keeper.

4. To check whether stock levels (minimum/safety/maximum) have been defined for regular

medicines/medical equipment and are monitored.

5. To check whether on issue of medicines, GRN is made in SAP and the same is reflected in 'HIS'.

6. To check whether the process of FIFO is followed while issuing the medicines. Use SAP Code

MB5B, MB52.

7. To check whether physical verification of medicines/medical equipment is done as per defined

procedures.

8. To check whether a physical verification report is prepared and signed by the authorities

presented during physical verification process.

9. To check reconciliation of physical stock is performed with HIS and SAP stocks and adjustments

for differences are made after adequate approval as per DOP.

10. To ensure that issue of medicine is supported with authorized request.

11. To check whether regular monitoring is done for expired stock and the same are disposed of

timely to avoid mishaps.

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12. To ensure that unauthorized person keeps a check so that spurious drugs, expired drugs etc. are

not received. Use SAP Code MB5M.

13. To check whether item master is reviewed to identify duplication and incomplete description.

Use SAP Code MM03.

25.IA.6 Patient's feedback and action plan Control Objective Patient satisfaction Nature of Work Step Verification Risk Patient dissatisfaction.

Nature of Control Manual 1. To check whether there is a process of taking feedback from the patients.

2. To check whether recommendations made by the patients are considered for evaluation of

processes.

25.IA.7 Regulatory and Statutory compliance Control Objective No penalties or imprisonment as applicable under the rules/provisions Nature of Work Step Verification Risk Regulatory & Statutory Non- Compliance.

Nature of Control Manual 1. To check whether there is compliance framework to monitor or track compliance required

under various law/Acts applicable to the Company.

2. To verify whether compliance of applicable rules/provisions are monitored periodically.

3. To check whether non compliance to the requirements is reported to the management


25.IA.8 Certification of bills of vendor Control Objective Authorized payment, No duplicity payments Nature of Work Step Verification Risk 1. Unauthorized and duplicate payments.

2. Delay in payment may lead to employee being denied treatment at the

hospital.

Nature of Control Manual/Automated 1. To conduct a walkthrough of certification of bills of vendor.

2. To check whether vendor's invoices are paid only after proper supporting have been verified

and approval is taken as per DOP. Use SAP Code FBL1N for accounting in GL code, MIR4 and

enter invoice number to see details.

3. To check whether advance payment made to the vendor is adjusted while making payment of

invoice. Use SAP Code FBL1N.

4. To check that there's no over payment / duplicate payment to the vendors. Ensure that the

payment has been made as per the approved rate card provided by the hospital. Use SAP Code

FBL1N.

5. To check whether payment is made only against liability created in SAP. Use SAP Code FBL1N.

6. Ensure that all the medical bills are paid timely by the Company.

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25.IA.9 Training Control Objective Trained staff Nature of Work Step Verification/Analysis Risk 1. Untrained staff.

2. Low quality of services.

Nature of Control Manual 1. To check whether training calendar/schedule for nurses and doctors is planned.

2. To check whether planned training schedule for nurses and doctors is complied with.

3. To check whether all staff/nurses/doctors were covered in training schedule.

4. To check whether attendance is recorded for staff / nurses / doctors who attended the

trainings.

5. To check whether feedback of the staff/nurses/doctors is obtained.

6. To check whether recommendations made by the staff/ nurses/ doctors are considered for

evaluation of training process.

25.IA.10 Claims Control Objective Processing Nature of Work Step Verification/Analysis Risk Incorrect processing of claims.

Nature of Control Manual/Automated 1. To ensure correct processing of claims. Use SAP Code FBL3N/FBL1N.

25.IA.11 Service Control Objective Quality of service Nature of Work Step Verification/Analysis Risk Delay in case of a breakdown.

Nature of Control Manual/Automated 1. To check that situation of breakdown of equipment is speedily met for its repair/ replacement.

Use SAP code IW29, IW39, IW23, IW33 and enter details of medical equipment numbers.

2. Obtain list of AMC from the department. Check whether all the equipment have been covered

under AMC. Further, check whether the maintenance is carried out as per schedule. Use T-code:

IE03/IP24/IP10, IW29/IW39.

3. To ensure there is no shortage of doctors and other staff.







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3. To check whether the manual records are verified and approved by concerned authority. 4. Use T-Code ML84 to view the list of SES's and ML81N to view the details of specific SES.

Check whether the SES for the services received is timely prepared. 5. Check whether proper technical survey/inspection is carried out for quality assurance before



delays.

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26. Pipe Line Fields – Internal Audit

Scope Audit scope

1 Planning, preparation and budget


3 Construction of Crude Oil Flow lines and Crude Oil Delivery (COD) Lines

4 Maintenance of Crude Oil Delivery (COD) lines

5 Construction of Natural Gas Flow lines and Transportation Lines

6 Maintenance of Natural Gas, transportation lines

7 Construction of formation water disposal lines

8 Maintenance of formation water disposal lines

9 Installation of Indirect Heater

10 Operation

11 PR Tracking

12 Creation of Service Entry Sheet


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1. Check whether the annual plan of Pipe line fields department is complete and all-inclusive to


















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27. Planning – Internal Audit

Scope Audit Areas

1 Budgeting and business plan

2 Budget monitoring

3 Pre-requisites for operations

4 MIS Reporting

5 Annual plan / MOU Targets

6 Inter departmental co-ordination

7 PR Tracking


9 Manpower Planning

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27.IA.1.1 Budget monitoring Control Objective To ensure expenditure with in the approved budget Nature of Work Step Verification/Analysis Risk Inability to prepare corrective action plans. Nature of Control Manual/Automated

1. Check whether adequate budget monitoring for budgeted vs. actual expenditure is there for all

type of budgets. Use T-Code S_ALR_87011761 to see all types of budget.

2. Check if preventive control is in place to ensure no expenditure is made beyond the approved

budget.

3. Check segregation of duties for preparation and releasing of budget in SAP. Use T-Code SUIM.

4. Check if all the budget is entered in SAP against appropriate cost center. Use T-Code CJ31.

5. Check if access to add or change the budget figures in SAP is restricted and allocated to

authorized person only. Use T-Code SUIM; S_ALR_87013560 for any updates in budget.

6. Check if any deviation from the approved budget is backed with proper reason and approval

from appropriate authority.

7. Check if the budget monitoring is done in line with assumptions taken during budget

finalization. Any deviation need to be factored in budget monitoring.

27.IA.1.2 Budget monitoring Control Objective Fixing accountability Nature of Work Step Verification/Analysis Risk Weak monitoring controls may lead in inability to initiate corrective action

plans. Nature of Control Manual/Automated

1. Check whether monitoring responsibility have been fixed within the department. (To monitor

execution of proposal/project within budgeted funds and time.)

2. Check whether appropriate reporting has been done by the person responsible in case of any

deviations.







Audit Checklist

259





Audit Checklist

260

28. Production Gas – Internal Audit

Scope Audit Areas

Production Gas -P & D


2 Monitoring

3 Contracting and receiving

4 Billing and sales accounting

5 PR tracking


7 Manpower planning


Production Gas - Projects

1 SOP compliance

2 Projects


4 Operations



7 Safety


9 Security



12 HSE compliances

Production Gas - SCADA

1 Monitoring through SCADA

2 Projects


4 Calibration



7 Maintenance

8 PR tracking


Production Gas - NAGFD


2 Gas transportation

3 Manpower planning


5 Well stimulation services

6 Commissioning and work over

Audit Checklist

261

7 Gas flaring

Production Gas -Admin & MSO

1 Health, safety and environment compliances




5 Administration

Production Gas -O & M

1 SOP Compliance


3 Maintenance

4 Maintenance of pipelines

5 Issuing material for replacement

6 Breakdown analysis

7 Safety




11 HSE compliances

Production Gas -GCS

1 SOP compliance

2 Operations

3 Safety

4 Testing of flow lines


6 Maintenance

Production Gas -Gas Field



3 Work over operation

4 Dehydration of Natural Gas

5 Gas flaring

6 Resource planning and monitoring

Audit Checklist

262

28.IA.1 P & D- Planning, budgeting & monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,



1. Check whether the annual plan of Production Gas department is complete and all-inclusive to






a. Linked to the requirement of various sections of production gas department





28.IA.2 P & D - Monitoring Control Objective Effective implementation of activities Nature of Work Step Analysis/Verification Risk Inefficient implementation of activities. Nature of Control Automated/Manual

1. Use T-Code S_ALR_87013532 to check whether actual expenses are monitored / compared with

planned expenses on periodic basis against such plan.

2. Check whether the information for future requirements is gathered and the proposal is sent for

approval to management.

3. Use T-Code MCPO to check whether the production reports are being prepared on daily/

weekly/ monthly/ quarterly basis visa- a- visa entry in SAP system.

4. Use T-Code MCPM to check actual production meets planned targets.

5. Use T-Code MC4L to check that there are no delays in response from service providers/

contractors.

6. Check that production target is fixed by corporate based on directives from government.

Audit Checklist

263

28.IA.3 P & D - PR tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Analysis/Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /

operational delays. Nature of Control Automated/Manual


timely.


DOP.





28.IA.4 SCADA - Statutory compliances Control Objective To ensure compliance to various statutory requirements Nature of Work Step Verification Risk Statutory Non-Compliance. Nature of Control Manual

1. Check that a checklist is maintained for all statutory compliances along with the due dates of

compliance to the same.

2. Check that license related to power has been obtained and updated regularly.

3. Check that statutory compliance checklist is analyzed and updated regularly.

4. Check whether all the statutory compliances are ensured by the department

5. Check if all statutory compliances w.r.t contract labour are ensured.

28.IA.5 SCADA - PR tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Analysis/Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /



timely.


DOP.





Audit Checklist

264

28.IA.6 Gas Field - Planning, budgeting & monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,



1. Check whether the annual plan of Production Gas (Gas Field) section is complete and all-

inclusive to cover the requirements of all the activities that come under its purview.






c. Linked to the requirement of various departments

d. Inclusive of all the related costs.




Audit Checklist

265

29. Production Oil – Internal Audit Scope

Audit Areas

Production Oil -P & D


2 Monitoring



5 PR tracking


7 Manpower planning


Production Oil - Projects

1 SOP compliance

2 Projects


4 Operations



7 Safety


9 Security



12 HSE compliances

Production Oil - Administration & Contracts





5 Administration

6 Contracts

Production Oil - Operations

1 SOP Compliance


3 Maintenance




7 Safety




Audit Checklist

266

11 HSE compliances

Production Oil - Installations (ITF/OCS/EPS/WPS)

1 SOP compliance

2 Operations

3 Safety



6 Maintenance

7 ITF

Production Oil - Water Injection

1 Water Injection

Production Oil - Utility

1 Utility

Production Oil - WSS

1 Well Stimulation Services

2 Work over Operations

Audit Checklist

267

29.IA.1 P & D - Planning, budgeting & monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,



1. Check whether the annual plan of Production Oil department is complete and all-inclusive to






a. Linked to the requirement of various sections of production gas department





29.IA.2 P & D - Monitoring Control Objective Effective implementation of activities Nature of Work Step Analysis/Verification Risk Inefficient implementation of activities. Nature of Control Automated/Manual


planned expenses on periodic basis against such plan.

2. Check whether the information for future requirements is gathered and the proposal is sent for

approval to management.

3. Use T-Code MCPO to check whether the production reports are being prepared on daily/

weekly/ monthly/ quarterly basis visa- a- visa entry in SAP system.

4. Use T-Code MCPM to check actual production meets planned targets.

5. Use T-Code MC4L to check that there are no delays in response from service providers/

contractors.

6. Check that production target is fixed by corporate based on directives from government.

29.IA.3 P & D - Billing and sales accounting Control Objective Ensure adequate and timely billing Nature of Work Step Analysis/Verification Risk Delay/ incorrect billing. Nature of Control Automated/Manual

1. Use T-Code VF03 to check that the quantities for invoicing are received from authorized person

of Production department.

2. Use T-Code VF03, VF05 to check whether invoices were raised as per defined timeliness.

3. Use T-Code FBL5N to check whether payment received from customer on time and interest

charged in case of delayed payment.

4. Use T-Code FBL3N to check whether reconciliation of Annual Returns has been done.

5. Use T-Code FBL3N to check whether reconciliation of return and payment of royalty, sales tax

etc. has been done.

Audit Checklist

268

29.IA.4 P & D - PR tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Analysis/Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /



timely.


DOP.





29.IA.5 Projects - Cost control analysis Control Objective Minimum cost and maximum productivity Nature of Work Step Verification Risk Low productivity and excess cost incurred. Nature of Control Automated/Manual

1. Use T-Code CJ31, CJ33, S_ALR_87013558 to check whether the budget allocated for Projects is

utilized in effective manner.

2. Use T-Code S_ALR_87013532 to check the cost incurred for Projects and compare the same

with the allocated budget.

3. Use T-Code S_ALR_87013532 to check costs incurred due to accidents or injuries sustained

while performing project work.

4. Use T-Code IE03, IW33, S_ALR_87013532 to check extra expense incurred due to obsolete

equipment.

Audit Checklist

269

30. Production Projects – Internal Audit

Scope Audit Areas

1 Preparation of surface plan / layout

2 Preparation of detailed equipment layout & piping drawings


4 Statutory clearances and compliance

5 Equipment & materials design & procurement

6 Contractor / Vendor

7 Contract procedures


9 Project implementation/ Project execution

10 Commissioning

11 Handing over of project

12 Monitoring framework

13 Projects investment

14 PR tracking



Audit Checklist

270

30.IA.1 Statutory clearances and compliance Control Objective Statutory clearances and compliance Nature of Work Step Analysis/Verification Risk Statutory Non-Compliance. Nature of Control Manual

1. Check that statutory clearances are timely obtained/ renewed to ensure there are no

operational delays due to any such delay.

2. Ensure compliance of the contract terms by the outsourced contractors as a result of existence

of adequate monitoring framework.

3. Ensure compliance to various statutory provisions and requirements.

30.IA.2 Contractor / Vendor Control Objective Adequate vendor management Nature of Work Step Analysis/Verification Risk Inefficient procurement of materials/services. Nature of Control Manual

1. Check that resource requirements pertaining to contractors / manpower was planned efficiently

and whether preparation of internal estimates is based on prevailing market rates.

2. Check whether adequate Performance Bank Guarantee (PBG) were obtained. Ensure that there

is no back out by L1 vendors. In case if it has happened, whether appropriate penalty was

charged and timely action was initiated for backlisting the vendor/contractor.

3. Check if there is cost/time overrun on account of inadequate deployment by contractor.

30.IA.3 Contract procedures Control Objective Monitoring of contractual terms Nature of Work Step Analysis/Verification Risk Non adherence to agreed terms impacting delivery as per contract. Nature of Control Manual

1. Ensure there is no time overrun on account of preparation of Technical specifications and

drawing by contractor.

2. Ensure there is continuous monitoring, progress reporting, quality inspections and other

contract terms etc. of work done by contractors.

3. Use T-Code ME23N,FBL1N to check if there is deduction for faulty work as per contract clause.

30.IA.4.1 Projects investment Control Objective Return on Investment (ROI)

Nature of Work Step Analysis / Verification Risk Non achievement of projected ROI. Nature of Control Automated/Manual

1. Use T-Code KE30 to view profitability analysis report and check whether projected ROI is

achieved.

Audit Checklist

271

30.IA.4.2 Projects investment Control Objective Funding requirements

Nature of Work Step Analysis / Verification Risk Non availability of required funds. Nature of Control Manual

1. Check whether there are appropriate tie ups done for meet funding requirements.

2. Check whether adequate and timely monitoring is done to ensure timely availability of funds.

30.IA.5 PR tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Analysis/Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /



timely.


DOP.









Audit Checklist

272

31. Projects – Internal Audit

Scope Audit Areas


2 Statutory approvals


4 Contracting

5 Project Implementation/ Project Execution

6 Commissioning




10 PR tracking



Audit Checklist

273




1. Check whether the annual plan of projects department is complete and all-inclusive to cover the











monitored/ compared with planned expenses on periodic basis.

31.IA.2 Statutory approvals Control Objective Statutory approvals Nature of Work Step Verification Risk Statutory non-Compliance. Nature of Control Manual

1. Check whether the project have the requisite statutory approvals prior to initiating construction

activities.

31.IA.3 Environment, Health and Safety Compliance Control Objective Safeguarding interest of Company / employees / public / environment Nature of Work Step Verification Risk Non-Compliance to HSE laws. Nature of Control Manual

1. Check whether there is a compliance framework related to statutory requirement for EH&S.

2. Check whether EH&S compliance framework is monitored and reviewed on regular basis.

3. Check whether compliance of Safety Operating Procedures (SOP) is ensured.

4. Check whether required documents/report/returns are filed on monthly/quarterly/annually

basis to Govt./State Govt. authorities.

5. Check whether necessary approvals/clearances were obtained before start of activities.

Audit Checklist

274

31.IA.4.1 Contracting Control Objective Strategy and contract award Nature of Work Step Analysis / Verification Risk Cost Overrun. Nature of Control Automated/Manual

1. Check whether appropriate contracting strategy is identified by the company (i.e. Turnkey

contracting vis-à-vis Engaging Multiple contractors etc.).

2. Check that internal estimates are prepared based on adequate inputs, required assumptions are

documented and the same is approved as per Company policy.

3. Check whether the prices quoted are too high or too low, to ensure whether price negotiation

with L1 Bidder is in conformity with CVO Guidelines and contract procedures.

4. Check that there is no time overrun in signing of the contract by successful bidder.

5. Use T-Code CJ30N and select the WBS for the sample project to check whether the small

projects undertaken by OIL are being handled effectively and efficiently.

31.IA.4.2 Contracting Control Objective Compliance of contract terms and conditions Nature of Work Step Analysis / Verification Risk Non-compliance to contractual terms and conditions by contractor. Nature of Control Automated/Manual

1. Use T-Code CJ20N and ME33K to check whether there was delay in mobilization by contractor.

2. Use T-Code CJ20N to check whether the timing of the contractor and the supplier is

coordinated.

3. Check that disputes with the contractor are handled with adherence to Contractual Clauses and

there is a timely release of bills.

4. Check there is compliance of the contract terms and conditions by the outsourced contractors.

31.IA.4.3 Contracting Control Objective Unsatisfactory performance by Contractor Nature of Work Step Analysis / Verification Risk Cost overrun. Nature of Control Automated/Manual

1. Use T-Code S_ALR_87015124, S_ALR_87015125 to view the project status and check whether

there is continuous monitoring/ progress reporting/ quality inspections etc.

31.IA.4.4 Contracting Control Objective Contract management Nature of Work Step Verification Risk Cost overrun. Nature of Control Manual

1. Check whether there is adequate contract management process (for e.g. Contract

administration, verification, certification etc.).

Audit Checklist

275

31.IA.5.1 Projects investment Control Objective Return on Investment (ROI) Nature of Work Step Analysis / Verification Risk Non achievement of projected ROI. Nature of Control Automated/Manual

1. Use T-Code KE30 to view profitability analysis report and check whether projected ROI is

achieved.

31.IA.5.2 Projects investment Control Objective Funding requirements Nature of Work Step Analysis / Verification Risk Non availability of required funds. Nature of Control Manual

1. Check whether there are appropriate tie ups done for meet funding requirements.

2. Check whether adequate and timely monitoring is done to ensure timely availability of funds.









Audit Checklist

276







delays.

Audit Checklist

277

32. Public Relations and Corporate Communication – Internal Audit

Scope Audit Scope

1 Budgeting

2 Implementation of CSR Policy/Projects

3 Implementation of corporate communication & media relations

4 Public relations

5 Public grievance management

6 Implementation of official language (Hindi)

7 MIS

8 PR tracking


10 Manpower plannning

Audit Checklist

278

32.IA.1 Budgeting Control Objective Adequate budget planning, Effective monitoring over expenses,

Compliance to DOP




Nature of Control Automated/Manual 1. Use T-Code CJ31 to view the actual budget submitted, CJ32 to check the approval for the

budget, and S_ALR_87013558 to check the actual vs. budgeted analysis. Ensure that the annual

budget is complete and all-inclusive to cover the requirements of CSR projects as per the DP

guidelines and whether the cost exceeding budget cases, if any are approved as per DOP.

2. Use T-Code KSBL to view the approval taken for estimates and ensure that estimates provided

by BDO are vetted by CSR committee, local management, and corporate DOP office.

3. Use T-Code KSBL to check whether annual budget is approved by competent authority as per

DOP.

4. Use T-Code KSBL to check whether any amendments in annual budget is approved by

competent authority as per DOP.


planned budget on periodic basis. Ensure reasoning analysis is done for al the cases wherein the

actual costs exceed the budget and approval is taken as per DOP.

32.IA.2.1 Implementation of CSR Policy/Projects Control Objective Compliance


Risk Non-Compliance to government guidelines.

Nature of Control Automated/Manual 1. Use T-Code S_ALR_87011761 to view the processes or programs on which the CSR budget has

been used. Ensure that the allocated CSR budget is spent on CSR projects in accordance to the

CSR policy and as per the Companies Act 2013 requirements.

2. Ensure that report of community development plan as per policy is submitted to CSR

Committee/ Local management/ Corporate office by PR/ Concerned department of other

spheres.

3. Ensure that summary of corporate development report is published in print and posted on OIL's

website.

4. Ensure that CSR Annual Report is published on OIL's website.

Audit Checklist

279

32.IA.2.2 Implementation of CSR Policy/Projects Control Objective Effective utilization, minimization of processing time, fulfillment of

development needs/ aspirations of target beneficiaries


Risk 1. Delay in achieving defined targets.

2. Inefficient process may lead to loss in terms of monetary and non-

monetary resources.

Nature of Control Manual 1. Check if the MoU targets on CSR are achieved. Ensure that third party certification for

completion is taken.

2. Check there is intradepartmental coordination.

3. Check there is liasoning with District Administration and Other related external agencies.

4. Check whether there is a proper process to ensure end use of funds allocated, by taking

feedback from beneficiaries and ensure that there is desired involvement in the projects.

32.IA.2.3 Implementation of CSR Policy/Projects Control Objective Timeliness


Risk Delay in achieving defined targets.

Nature of Control Automated/Manual 1. Use T-Code KSBL to check for timeliness in getting the management approval.

2. Use T-Code CJ20N and enter the WBS for the project to check that there is timeline set in every

stage of project execution.

32.IA.3 Implementation of corporate communication & media relations Control Objective Effective media relations, enhancement of OIL's brand image,

timeliness


Risk 1. Loss in brand value.

2. Leaking of confidential information may harm the Company's

growth.

Nature of Control Automated/Manual 1. Check whether there is timely publication of all the communiques ensuring excellent coverage

of OIL events, achievements in local, regional and national media.

2. Use T-Code FBL1N to check whether authorized statements are made on behalf of the

company.

3. Check if there is any leaking of confidential information taking place.

4. Check whether proper branding guidelines are being followed.

5. Check if there is any drawback in reaching out to the respective target audience and the media.

6. Check whether timely and regular inputs are obtained from OIL's Departments.

7. Check the timeliness of getting the Management Approval.

8. Check whether there is timely communication with Media Personnel and related external

agencies.

Audit Checklist

280

32.IA.4 Public relations Control Objective Expenditure

Nature of Work Step Verification Risk Cost over-run.

Nature of Control Automated/Manual

1. Use T-Code KSBL, CJ20N to check whether the expenditure is authorized by the competent

authority as per DOP.

2. Check there is compliance to MoU.

3. Ensure that the expenses incurred are audited by a firm of Chartered Accountants annually.

32.IA.5 Public grievance management Control Objective Receiving of grievance , processing of grievances

Nature of Work Step Verification Risk 1. Loss in brand value.

2. Delay in grievance settlement may lead to public unrest causing

operational delays.

Nature of Control Manual 1. Check for all the grievances received against OIL.

2. Check the timeliness of receiving the information of public grievance.

3. Check whether the processing time is minimized.

4. Check if a dedicated cell has been set up within PR department to provide strategic attention to

public grievance mitigation.

5. Check whether there is departmental coordination.

6. Check whether there is timely liasoning with district administration.

32.IA.6 Implementation of official language (Hindi) Control Objective Timeliness

Nature of Work Step Verification Risk Delay in achieving defined targets.

Nature of Control Manual 1. Check if there are delays in executing translation and related activities of promotion and

implementation of official language (Hindi) in the Company.

32.IA.7 MIS Control Objective Accurate reporting of expenditure

Nature of Work Step Verification Risk Incorrect or delay in reporting.

Nature of Control Automated/Manual 1. Ensure that the expenditure incurred is reported periodically to the Audit Committee/

Management.

2. Use T-Code CJI3 to check whether the expenses and end use of funds is reported accurately.

Audit Checklist

281















delays.





Audit Checklist

282

33. Research Development – Internal Audit

Scope Audit Scope

1 SOP Compliance

2 R&D budget

3 R&D activities

4 Procurement and AMC contracts

5 Testing & Inventory management


7 Statutory Requirements

8 Confidentiality

9 PR tracking



Audit Checklist

283

33.IA.1 Testing & Inventory management Control Objective Availability of right information at right time,

Restricted and authorized access Nature of Work Step Analysis / Verification Risk 1. Non availability of information may hamper the operations.

2. Possibility of unauthorized transactions. Nature of Control Automated/Manual

1. Use of T-Code - SUIM to check the authorization access rights to R&D test results and database.

2. Check the process / techniques for carrying out testing of water injection and quality

parameters as defined.

3. Use of T-Code - IK07, IK17, S_ALR_87013321 to check whether R&D tools and equipment are

timely identified and initiated for calibration process.

4. Use of T-Code - MB52 to check adequate maintenance of inventory of chemicals and restricted

access to the storage premises.

5. Use of T-Code - S_SH8_72000033 to check the compliance to Central Pollution Control Board

(CPCB) guidelines.

6. Use of T-Code - MCXB, MCXD to Check adequate documentation of the test reports and timely

communication of the test results to the concerned personnel.

7. T-Code - MCXB, MCXD to check if the adequate quality checks are performed during receipt to

ensure actual consignment sample matches with laboratory test and field trail samples.

8. Use of T-Code - MCXB, MCXD to check if the quality acceptance is done in SAP based on actual

quality test.

9. Use of T-Code - IK07, IK17, S_ALR_87013321 to ensure that proper calibration plan is prepared

for calibrating all tools and equipment.

10. Use of T-Code - IP24, IW23, IW39 to extract and ensure that all equipment are duly calibrated as

per the plan.







Audit Checklist

284

34. Safety Environment – Internal Audit

Scope Audit Areas


2 Training of Employees

3 Periodic Audits & Inspections

4 Statutory Clearances and permission

5 Disposal of waste, Hazardous chemicals and other by products

6 PR Tracking


8 Manpower Planning

9 Fire Safety Plan

10 Fire Safety training

11 Fire fighting Equipments testing

12 Incident Management

13 Procurement of Fire safety equipments

Audit Checklist

285

34.IA.1 HSE - PR tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Verification/Analysis Risk Delay in procurement leading to costlier procurement/ stock out situations/






34.IA.2 HSE - Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Verification/Analysis Risk 1. Over/Under Utilization of manpower.




34.IA.3 Procurement of Fire safety equipment Control Objective Availability of right equipment at right price Nature of Work Step Verification Risk Non availability of equipment. Nature of Control Automated/Manual

1. Use T-Code MB5B to view the details of stock on a particular date. Check the process of

planning the requirement of fire safety equipment. Ensure proper basis (trend analysis using

past records etc.).

2. Ensure that no equipment is out of stock or below threshold level defined. Also, ensure that no

non-moving or slow-moving stock has been procured.

3. To check if timely procurement and compliance to company policy is ensured for all

procurements. Use T code ME5A, ME2N.

4. To check if there exists documented basis, approval and recording of all distributions of fire

safety equipment.

Audit Checklist

286

35. Security – Internal Audit

Scope Audit Areas


2 Security services

3 Attendance records

4 Workforce deployment

5 Amenities and imprest to the workforce

6 Regulatory and Statutory Compliance

7 Vehicles/visitors movement


9 Police background verification

10 Complaints

11 Training

12 PR tracking



Audit Checklist

287




1. Check whether the annual plan of security department is complete and all-inclusive to cover the











35.IA.2 Security Services Control Objective Effective implementation of security activities

Nature of Work Step Verification Risk 1. Inadequate security infrastructure.

2. Delay in providing Security Services.

3. Risk of sabotage and unauthorized entry.

Nature of Control Manual 1. To ensure there is appropriate security infrastructure and equipment.

2. To ensure there is no delay in providing security services.

3. To check whether the risk from anti-social elements was averted through liasoning with local

police, coordination with CISF and Assam Industrial Security Force (AISF) etc.

4. To check that there is issue of security passes on day to day basis and periodic basis by

CISF/Security department to labors and visitors with recommendations of the user departments

to enter in the restricted area.

5. To check whether inventory of arms and ammunitions are checked and maintenance done on

regular basis.

6. To check whether advance intelligence inputs are gathered.

7. To check whether mock drills of security alertness and preparedness are conducted, up

gradation of security gadgets, access and exit controls, proper documentations exist.

Audit Checklist

288

35.IA.3 Attendance records Control Objective Appropriate attendance process and payment to the workforce

Nature of Work Step Verification Risk 1. Risk of recording incorrect attendance.

2. Processing incorrect payment to workforce.

Nature of Control Manual 1. To conduct a walkthrough of the attendance process of the workforce and identify the gaps in

process. To check whether a defined format is used to record attendance of various types of the

workforce.

2. To check whether attendance records are maintained and reviewed on daily basis.

3. To check whether overtime is recorded separately and the same is approved as per DOP.

4. To check whether the payment to workforce is made as per the approved attendance records

and overtime records.

35.IA.4 Workforce deployment Control Objective Timely deployment, availability of work force at sites

Nature of Work Step Verification Risk Delay in deployment of workforce.

Nature of Control Manual 1. To conduct a walkthrough of the workforce deployment process and identify gaps in process. To

check whether the workforce is deployed in a reasonable time as per requirement of the user

department.

2. To check whether the workforce deployed at sites is adequate and aligned as per requirement

of the user department.

3. To ensure there is effective utilization of workforce.

4. To ensure there is a provision for emergency deployment of forces.

5. To check whether surprise visit is done to verify availability of deployed workforce at sites.

35.IA.5 Amenities and imprest to the workforce Control Objective Compliance to contractual terms, tracking of amenities issued to the

workforce

Nature of Work Step Verification Risk Non Compliance to contractual terms.

Nature of Control Automated/Manual 1. To check whether the basic amenities provided to workforces are as per the contractual terms.

To check whether exceptions to the contractual terms are approved as per DOP. Use SAP

ME23N and ME33K.

2. To check whether amenities issued to the workforces are tracked and monitored on regular

basis.

3. To check there is cash imprest monitoring. Use SAP T-code FBL3N.

4. To check whether imprest advance is issued to the workforce as per contractual terms. Use SAP

T- code FBL3N, FBL1N.

Audit Checklist

289

35.IA.6 Regulatory and Statutory Compliance Control Objective No penalties or imprisonment as applicable under the rules/provisions

Nature of Work Step Analysis/Verification Risk Regulatory and Statutory Non-Compliance.

Nature of Control Manual 1. To check whether there is compliance framework to monitor or track compliance required

under various law/Acts applicable to the Company.

2. To verify whether compliance of applicable rules/provisions e.g. Minimum Wages Act 1948,

Employees' State Insurance Act 1948 are monitored periodically.

3. To check whether noncompliance to the requirements is reported to the management


35.IA.7 Vehicles/visitors movement Control Objective Monitoring over vehicles/visitors movements

Nature of Work Step Verification Risk Poor monitoring over vehicles and visitors.

Nature of Control Manual 1. To check whether the inward and outward registers for vehicle movements are maintained and

all the relevant details are captured.

2. To check that visitor’s register is updated and all the relevant details are captured.

3. To check whether surprise checking is done for the vehicles/visitors.

4. To check whether visitor pass is checked at gate before allowing entry in the premises.

35.IA.8 Certification of bills of vendor Control Objective Authorized and appropriate payment, No duplicity of payments

Nature of Work Step Analysis/Verification Risk 1. Unauthorized payments

2. Duplicity of payments.

Nature of Control Automated/Manual 1. To conduct a walkthrough of certification of bills of vendor.

2. To check whether that the payment is processed on the basis of agreed contractual terms and

rates agreed upon. Use SAP T-code FBL1N, MIR4.

3. To check whether that the payment is processed on the basis of agreed contractual terms and

rates agreed upon. Use SAP T-code FBL1N, MIR4.

4. To check whether vendor's invoices are paid only after proper supporting e.g. attendance

records, claims have been verified and approval is taken as per DOP. Use SAP T-code FBL1N,

MIR4.


invoice. Use SAP T-code FBL1N, MIR4.

6. To check whether any deductions to be made from the agencies deploying the workforce is

processed while making payment. Use SAP T-code FBL1N, MIR4.

Audit Checklist

290

35.IA.9 Police background verification Control Objective Timely police verification

Nature of Work Step Verification Risk Entry of unauthorized person.

Nature of Control Manual 1. To check whether requests received for police verification of new recruitments are monitored.

2. To check whether the process of police verification is initiated and completed timely.

3. To check whether employee has been hired after completion of police verification.

4. To check whether police verification is done for all the WCLs employed by the contractors.

5. To check whether follow up is done with Police to complete police verification for pending

requests.

35.IA.10 Complaints Control Objective Users' satisfaction

Nature of Work Step Verification Risk Delay in action over complaints.

Nature of Control Manual 1. To check whether complaints lodged with Security Department are recorded.

2. To check whether status of complaints lodged is maintained.

3. To check whether timely action over the recorded complaints is done.

35.IA.11 Training Control Objective Trained workforce

Nature of Work Step Verification Risk Untrained workforce.

Nature of Control Manual 1. To check whether training calendar/schedule for the workforce is planned. To check whether

planned training schedule for the workforce is complied with.

2. To check whether all workforce are covered in training schedule.

3. To check whether attendance is recorded for the all trainings conducted.

4. To check whether feedback of the workforce is obtained.

5. To check whether recommendations made by the workforce are considered for evaluation of

training process.







Audit Checklist

291









delays.





Audit Checklist

292

36. Transport – Internal Audit

Scope Audit Areas



3 Deployment of vehicles

4 Passenger vehicle

5 Inspection


7 Health, Safety & Environment

8 Maintenance

9 Inventory control of maintenance / spares items

10 PR tracking



Audit Checklist

293




1. Check whether the annual plan of transport department is complete and all-inclusive to cover

the requirements of all the activities that come under its purview.










36.IA.2 Creation and release of purchase requisition Control Objective Timely procurement of stores/spares

Nature of Work Step Analysis/Verification Risk Operational risk due to non-availability of stores/spares on time.

Nature of Control Automated/Manual 1. To check whether PR is raised as per Purchase/Contract policy manual. Use T-code ME53N,

ME5A.

2. To check whether the PR for procurement/hiring of vehicles/buses/spares and hiring of

contractual manpower is raised timely. Use T-Code ME53N, ME5A.

3. To check whether approvals for PR is taken as per DOP. Use T-Code ME53N, ME5A.

4. To conduct lead time analysis between PR initiation and its release. Ensure there is reasoning

analysis done for delays. Use T-Code ME53N, ME5A.

5. To check whether there is a process of reviewing pending PRs and its follow up process with

Contracts/Material Management. Use T-Code ME53N, ME5A.

6. To check whether proper specifications are mentioned while creating a PR. Use T-Code ME53N,

ME5A.

7. To check whether all PRs are raised through SAP.Use T-Code ME53N, ME5A.

8. To check that there is no delay in procurement of stores/spares, no delay in procurement due to

incomplete / unapproved PR. Use T-Code ME53N.

9. To check whether no hired vehicle is being used after expiry of contract. Use T-Code ME23N,

ML84.

Audit Checklist

294

36.IA.3 Deployment of vehicles Control Objective Efficient utilization of vehicles

Nature of Work Step Analysis/Verification Risk Inefficient utilization of vehicles.

Nature of Control Automated/Manual 1. To check whether there is an updated database for all the vehicles/buses owned or hired by the

Company -Use T-Codes IE03, IH08.

2. To check whether there exists a process of verifying the number of Company owned/hired

vehicles and their classification i.e. heavy and light etc.

3. To conduct a walkthrough of the process of deployment of vehicles and identify gaps, if any.

4. To check whether the deployment plan is aligned to the request received from different

departments.

5. To check whether there exists a process of monitoring of the deployment plan.

6. To check whether a log book is maintained for each vehicle.

7. To check whether the log book is verified and signed by the in-charge everyday

8. To check whether there is a process of analyzing vehicle utilization and thereafter,

increasing/decreasing the fleet size, if required. Use T-Codes IE03, IK07, IK17, S_ALR_87013421.

9. To check whether detailed analysis is conducted for calculating fuel efficiency as against the

OEM recommendation.

10. To check whether root cause analysis is done for all the variances observed and steps are

initiated for improvements.

11. To check there is effective utilization of hired vehicles. Use T-Code IK51.

12. To check whether the utilization analysis and fuel efficiency analysis is signed off.

36.IA.4 Passenger vehicle Control Objective Availability of vehicles

Nature of Work Step Analysis/Verification Risk Non availability of vehicles.

Nature of Control Manual 1. To check that adequate planning is undertaken for regular operation of transport activities.

2. To check there is regular monitoring to ensure availability of vehicles for deployment of

manpower.

36.IA.7 Health, Safety & Environment Control Objective Statutory Compliance, avoid accidents

Nature of Work Step Analysis/Verification Risk 1. Non-Compliance to statutory framework.

2. Frequent employee accidents and dissatisfaction.

Nature of Control Automated/Manual 1. To check whether statutory safety requirements w.r.t transportation of materials to the fields,

passenger vehicles etc. are complied with. E.g.: fire extinguisher in every truck carrying rigs etc.

2. To check whether there is a repository comprising of all the HSE compliances.

3. To check whether the compliances as defined are monitored regularly.

4. To ensure compliance to the Safety Manual.

5. To check whether tool box meeting is conducted before initiation of any major maintenance

job.

6. To check whether there exists a training calendar for the department and its compliance.

Audit Checklist

295

7. To check whether statutory training e.g. MVT (Mines Vocational Training) and First Aid Trainings

are conducted as per statutory requirement.

8. To check whether all the employees are trained as per schedule. E.g.: MVT training is to be

attended by an employee every 5 years.

9. To check whether feedback is taken from attendees w.r.t training and improvement measures

are initiated.

10. To check whether root cause analysis has been done for all the accidents during the year and

steps are taken to avoid the same.

36.IA.9 Inventory control of maintenance / spares items Control Objective Avoiding stock out situation, adequate approvals for issuance,

inventory controls

Nature of Work Step Analysis/Verification Risk 1. Inappropriate approvals.

2. Inappropriate inventory levels leading to stock out situation.

Nature of Control Automated/Manual 1. To check whether there is a process for review of inventory levels of Maintenance/spares items.

Use T-Codes MB52, MMBE, MB5B.

2. To conduct a walkthrough of the issuance process of Maintenance/spares items from stores and

identify gaps. Use T-Codes MB52, MMBE, MB5B.

3. To ensure that sub-quality spare parts are not used, leading to frequent break downs. Use T-

Code MCXB.







Audit Checklist

296





Audit Checklist

297

37. Well logging – Internal Audit

Scope Audit Areas

1 Data collection and its storage

2 Interpretation

3 Planning and budgeting process (Equipment, manpower etc.)



6 Issuance of stores/spares items

7 Open hole/ cased hole

8 Logging equipment management and maintenance



11 Buy vis a vis Hiring of well logging equipment

12 Training



Audit Checklist

298

37.IA.3 Planning and budgeting process (Equipment, manpower etc.) Control Objective Adequate planning, Effective monitoring over annual plan, Compliance to

DOP Nature of Work Step Analysis/Verification Risk 1. Non Compliance to DOP.

2. Inadequate planning. Nature of Control Automated/Manual

1. Use T-Code KSBL to check whether the annual plan of Well Logging department is complete and

all-inclusive to cover the requirements of equipment's and manpower.

2. To ensure there is availability of manpower (engineers and crew).

3. Use T-Code KSBL to check whether annual plan is approved by competent authority as per DOP.

4. Use T-Code KSBL to check whether any amendments in annual plan is approved by competent



periodic basis. T-codes reference for reports / verification S_ALR_87013532/S_ALR_87013558.

37.IA.5 Purchase requisition Control Objective Timely procurement of spares Nature of Work Step Analysis/Verification Risk Non-availability of spares.

Nature of Control Automated/Manual 1. Use T-Codes ME53N and ME5A to check whether PRs for spares/materials/jobs are raised

timely.


DOP.





37.IA.11 Buy vis a vis Hiring of well logging equipment Control Objective Exploiting the best option available

Nature of Work Step Analysis/Verification Risk Increase in Cost.

Nature of Control Automated/Manual 1. To check whether cost benefit analysis is done for buying vis a vis hiring of equipment

Audit Checklist

299

38. Business Development – Internal Audit

Scope Audit Areas

1 Asset acquisitions

2 New opportunities

3 Monitoring

4 PR tracking


6 Manpower planning

Audit Checklist

300

38.IA.1.1 Monitoring Control Objective Compliance with PSC /JOA or Farm-in Agreements Nature of Work Step Verification Risk Non Compliance with PSC /JOA or Farm-in Agreements. Nature of Control Manual/Automated

1. Ensure that there is compliance with PSC / JOA or Farm-in agreements with respect to non-

operator.

2. Ensure that any cash call received is checked for correctness, is duly approved and supported

with appropriate documents like details of expenditure and budget for future activity. Use

transaction Code- GJ01, GJ02, GJ05.

3. Ensure that timely reports are received from operator with respect to budgets / MWP and

annual program.

4. Ensure monthly update is received from the operator.

5. Ensure that all Authorization for Expenditures (AFE) are sent by operator before incurring

expenses.

6. Check whether MIS for blocks handled by BD department is being prepared and monitored.

38.IA.1.2 Monitoring Control Objective Compliance with PSC /JOA or Farm-in Agreements Nature of Work Step Verification Risk Non Compliance with PSC /JOA or Farm-in Agreements. Nature of Control Manual

1. Check whether audited accounts of overseas projects have been received on timely basis.

2. Check whether cash calls received from overseas Non operated JV have adequate supporting

and are as per the agreement.









Audit Checklist

301







delays.





Audit Checklist

302

39. Corporate affairs – Internal Audit

Scope Audit Areas


2 Environment scan and business development

3 Management service group

4 PR tracking


6 Manpower planning

Audit Checklist

303


compliance to DOP Nature of Work Step Analysis/Verification Risk 1. Non Compliance to DOP.

2. Inadequate Planning. Nature of Control Automated/Manual

1. To check whether the annual Corporate strategic plan of is complete and all-inclusive.

2. To check whether annual plan is approved by competent authority as per DOP. Use T-codes

KSBL for reports / verification. Version Management can be used to track changes.

3. To check whether the Corporate Strategic Plan is revisited as per requirement.

4. To check whether any amendments in annual plan is approved by competent authority as per

DOP. Use T-Code KSBL.

5. To check whether budget is made as per the annual plan and is inclusive of all the related costs.

Use SAP T-codes CJ31 and CJ33 to check if budget has been entered into SAP. Check if any

supplementary budget has been passed on the project.

6. To check that everything is within the financial limits that have been allowed to various levels as

per DOP. Use T-code S_ALR_87013532.

7. To check whether the budget is timely prepared and approved as per DOP.

8. To check whether all the supporting w.r.t budget approvals are uploaded in SAP. T-Code CV03N

to be used as reference for reports verification.


periodic basis. Use T-codes S_ALR_87013532.

10. To check whether there is a follow up mechanism for internal/external approvals to ensure

timeliness.

39.IA.2.1 Environment scan and business development Control Objective Trend analysis , expansion Nature of Work Step Verification Risk Losing on opportunities to grow. Nature of Control Manual

1. To check whether activities such as study of upcoming trend/ due diligence of areas is

undertaken so that identification of new areas to be entered for investments/ expansion can be

accessed with greater accuracy.

2. To verify whether the assessment of business opportunity involves assured gains and minimizes

risk to an extent possible.

3. To check whether there is timely identification of areas for expansion / investment.

39.IA.2.2 Environment scan and business development Control Objective Domestic business development Nature of Work Step Verification Risk Lack of Business Development. Nature of Control Manual

1. To check whether steps are being undertaken w.r.t domestic business development.

Audit Checklist

304

39.IA.3.1 Management service group Control Objective Preparation and updation of MIS Nature of Work Step Verification Risk Delay in preparation of MIS. Nature of Control Manual

1. To check whether the MIS is timely prepared and updated.

2. To check whether there is correct reporting to the management.

39.IA.3.2 Management service group Control Objective Timeliness Nature of Work Step Verification Risk Information not available to management for the purpose of review. Nature of Control Manual

1. To check whether gathering of data is done within timelines.

2. To check whether timely information is provided to the management.

39.IA.3.3 Management service group Control Objective Corporate scorecard Nature of Work Step Verification Risk KPI's not aligned with the organizational objectives. Nature of Control Manual

1. To check whether the KPI of the individuals are aligned to the overall organizational objectives.







Audit Checklist

305









delays.





Audit Checklist

306

40. Secretarial – Internal Audit

Scope Audit Area

1 Compliances

2 PR Tracking


4 Manpower Planning

Audit Checklist

307

40.IA.1.1 Compliances Control Objective Compliance to statutory rules and regulations/laws. Nature of Work Step Verification Risk Non-Compliances Nature of Control Manual

1. Check whether checklists for all the relevant acts are being maintained by the department. Few

acts are mentioned below:

a. The Companies Act, 1956/2013 and regulations frames under the Act

b. Securities and Exchange Board of India Act, 1992

c. SEBI (Substantial Acquisition of shares and Takeovers) Regulation,1997

d. Disclosure & Investor Protection Guidelines,2000

e. The Depositories Act, 1996 and regulations frames under the Act

f. Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations

2008

g. The Listing Agreement for Debt Securities with the National Stock Exchange of India Ltd.

h. Please note that the above list is not comprehensive.

2. Check whether the checklists are updated whenever amendments are announced.

3. Check whether secretarial audit has been conducted as per The Companies Act, 1956/ The

Companies Act, 2013, as applicable.

40.IA.1.2 Compliances Control Objective Follow-up on observations Nature of Work Step Verification Risk Non-Compliances Nature of Control Manual

1. Obtain the list of non-compliances noted during secretarial audits.

2. Check whether there is a process to follow-up on audit observations and ensure its compliance.

3. Check whether all the audit observations have been complied with.







Audit Checklist

308









delays.





Audit Checklist

309

41. Centre of Excellence – Internal Audit

Scope Audit Areas


2 Work programs

3 Hiring

4 PR tracking


6 Manpower planning

Audit Checklist

310




1. Check whether the annual plan of Centre of excellence department is complete and all-inclusive

to cover the requirements of all the activities that come under its purview.











41.IA.2 Work programs Control Objective Meeting the targets Nature of Work Step Verification Risk Failure to meet targets. Nature of Control Manual

1. To check whether the work program has been made for the year and vetted by the approving

authority.

2. To check that the targets made have been approved.

3. To check whether business targets and objectives decided are monitored and action plan

prepared for any delay.

41.IA.3 Hiring Control Objective Hiring of right manpower Nature of Work Step Verification Risk Inappropriate hiring of manpower. Nature of Control Manual

1. To check whether hiring of skilled/ unskilled manpower is done as per Company Policy.

2. To check whether the person with right qualification has been chosen for the right job.

3. To check whether the adequacy of the manpower hired is reviewed.



Audit Checklist

311













delays.





Audit Checklist

312

42. PHQ OIL Movement – Internal Audit

Scope Audit Areas


2 Costs


4 Forward transfers

5 Reverse transfers

6 Reconciliation

7 Maintenance

8 Oil Transportation Contract

9 Billing

10 Service contract management

11 Closure of service contract

12 PR tracking



Audit Checklist

313




1. Check whether the annual plan of PHQ Oil movement department is complete and all-inclusive

to cover the requirements of all the activities that come under its purview.











42.IA.2 Costs Control Objective Monitoring cost Nature of Work Step Analysis Risk Higher cost. Nature of Control Automated/Manual

1. To check whether operating cost is monitored with respect to budgeted parameters and

reasons are identified for deviations, if any. Based on reasoning analysis, whether corrective

actions are initiated. Use T-Code S_ALR_87013558.

42.IA.3 Billing Control Objective Correct billing Nature of Work Step Verification Risk Incorrect billing. Nature of Control Automated/Manual

1. To check the terms defined in MoU / contract with respect to the penalty and billings are

adhered for invoices raised to ONGC, IOCL, NRL, etc. Ensure the invoice raised is as per the

contract and the amount paid is as per the invoice.

2. To check whether correct invoice / billing is done. Use T-Code FBL1N.

3. To check whether MoU is uploaded in SAP.

Audit Checklist

314











Audit Checklist

315

43. PHQ Pipeline – Internal Audit

Scope Audit Areas




4 Maintenance of sub surface pipelines including surface facilities (Routine jobs)

5 Maintenance of sub surface pipelines including surface facilities (Non routine jobs)

6 Health inspection of pipelines



9 Maintenance of Crude Oil Delivery (COD) Lines

10 Maintenance

11 Training

12 PR tracking


Audit Checklist

316




1. Check whether the annual plan of PHQ Pipeline maintenance department is complete and all-












43.IA.2 Certification of bills of vendor Control Objective Authorized and appropriate payment.

Nature of Work Step Analysis/Verification Risk 1. No duplicity payments

2. Inappropriate payments.

3. Duplicity of payment. Nature of Control Automated/Manual

1. Conduct a walkthrough of certification of bills of vendor. To check whether vendor's invoices

are paid only after proper supporting have been verified and approval is taken as per DOP. Use

T-Code FBL1N.


invoice, if applicable Use T-Code FBL1N.

3. To check that there is no over payment/ duplicate payment/ unauthorized payment to the

vendors Use T- code FBL1N, MIR4.

4. To check that there is correct certification of contractor bills.

5. To check whether payment is made only against liability created in SAP. Use T-code FBL1N.

Audit Checklist

317











Audit Checklist

318

44. PHQ – Pump Stations – Internal Audit

Scope Audit Areas










10 Maintenance

11 Training

12 PR tracking


Audit Checklist

319

44.IA.1 Planning, budgeting & monitoring

Control Objective Adequate planning and approvals, effective tracking of annual plan, compliance to DOP



1. Check whether the annual plan of PHQ Pump Station department is complete and all-inclusive to









7. Use T-Code S_ALR_87013532 by entering cost center to check whether actual expenses are monitored / compared with planned expenses on periodic basis.

44.IA.2 Training Control Objective Trained workforce Nature of Work Step Verification Risk Untrained workforce. Nature of Control Manual

1. To check whether adequate training is provided to manpower.

2. To check whether training calendar/schedule for the workforce is planned.

3. To check whether planned training schedule for the workforce is complied with.


5. To check whether attendance is recorded for the workforce who attended the trainings.



training process.

44.IA.3 PR tracking Control Objective Timely raising of PR and monitoring Nature of Work Step Analysis/Verification Risk Delay in procurement leading to costlier procurement/ stock out situations /



timely.


DOP.





Audit Checklist

320









delays.





Audit Checklist

321

45. Kolkata Shipping Office – Internal Audit

Scope

Audit Areas


2 Third party custody transfer

3 Assets/ Equipment


5 Reporting


7 Security services

8 Training

9 Operations

10 PR tracking



Audit Checklist

322

45.IA.1 Planning, budgeting & monitoring Control Objective Adequate planning, Effective monitoring over plan, Compliance to DOP Nature of Work Step Analysis/Verification Risk 1.Inadequate Planning.

2.Ineffective Monitoring. 3.Non Compliance to DOP.

Nature of Control Automated/Manual 1. To check whether the plan of shipping office is complete and all-inclusive for man, materials,

equipment required. To check whether such plan is approved by competent authority as per DOP Use T-Code KSBL This report can be used to view annual planning at cost center level.

2. To check whether any amendments in such plan is approved by competent authority as per DOP. Use T-Code KSBL Version Management can be used to track changes.

3. To check whether actual expenses are monitored / compared with planned expenses on periodic basis against such plan. Use T-code S_ALR_87011761. This report can be used to view planned vs. actual expenses.

4. To check whether there are laid down procedures for preparation and planning. 5. To verify if that inspection plans exist for maintenance of flow lines and lines are regularly tested

and inspected for damage or blockages. 6. To check whether such laid down procedures are complied with.Use T-Code FBL3N to review

whether correct and timely accounting is done so as to ensure compliance to generally accepted accounting concepts.

45.IA.2 Environment, Health and Safety Compliance Control Objective Safeguarding interest of Company / employees / public / creatures Nature of Work Step Verification Risk Non Compliance to Environment, Health and Safety. Nature of Control Manual

1. To check whether there is a compliance framework related to statutory requirement for EH&S. 2. To check whether EH&S compliance framework is monitored and reviewed on regular basis. 3. To check whether compliance of Safety Operating Procedures (SOP) is ensured and

documented. 4. To check whether required documents/report/returns are filed on monthly/quarterly/annually

basis to Govt./State Govt./Authorities/AERB.

45.IA.3 Agent Control Objective Selection/ Billing/ Release of payments Nature of Work Step Verification Risk 1.Delay in Settling Agents Commission.

2.Overpayment/ Duplicity of payment to agent. Nature of Control Manual/Automated

1. Check the process of selection of agents as per the Contracts checklist. 2. To check whether release of payment is done after getting all clearances. Use T-code MIR4 to

display logistics invoice, FBL1N to display vendor invoice for reference. 3. To check whether Agents commission bills are timely settled. Use T-code MIR4, FBL1N for

reference. 4. To check if adequate reasoning is provided for selection of Agents with higher rates. 5. To verify the correctness of bills submitted by agents. Use T-code MIR4, FBL1N for reference. 6. To check that no case of overpayment / duplicate payment to agents occurs.

Audit Checklist

323

45.IA.4.1 Import clearance/ Shipping function Control Objective Proper documentation


Risk 1.Delay in Clearing imports. 2.Improper Documentation.

Nature of Control Automated/Manual 1. To check if the shipping office is timely clearing all the imports. 2. To check whether the PO was received by the shipping office. 3. To check whether the freight forwarder is informed about the consignment timely. Use T-code

VL06T to display deliveries ready for transport planning. 4. To check whether Letter of credit is established as per the delivery schedule and all the relevant

terms and clauses are mentioned in the LC as per the PO/Contract. Ensure it is approved as per DOP.

5. Review the time lag between purchase order date and LC establishment date. Analyze the reasons for delay.

6. Review the process of opening/extending the LC and cost involved therein. Ensure that the charges are as per the agreement with the bank.

7. To check whether payment terms in L/C were checked and payment made against proper documentation. Use T-code MIR4, FBL1N for reference.

8. To make payment to the bank (in case of L/C) only if proper documentation and clean Bill of Lading is obtained. Use T-code MIR4, FBL1N for reference.

9. To check that the payment is released only after receipt of documentation and any financial loss emerging on account of delay in receipt of documentation is borne by the supplier. Ensure that the payment is made at correct exchange rate. Use T-code MIR4, FBL1N for reference.

10. To ensure that all the shipping documents are present from the supplier's side to the freight forwarder (FF).

45.IA.4.2 Import clearance/ Shipping function Control Objective Ship arrival/ cargo arrival Nature of Work Step Verification Risk Delay in intimation. Nature of Control Manual/ Automated

1. To check whether timely intimation is received about shipment arrival. Use T-code VL06IG for reference.

45.IA.4.3 Import clearance/ Shipping function Control Objective Minimum demurrage charges Nature of Work Step Verification/Analysis Risk Excess demurrage paid. Nature of Control Manual/Automated

1. Use T-code FBL3N to extract the ledger for demurrage. 2. Check on a sample basis, whether the same have been approved as per DOP. 3. Check whether an MIS is prepared to monitor the reasons for paying demurrage. Check whether

there is a process of analysis the MIS and taking action to ensure that demurrage charges paid may be reduced in future.

Audit Checklist

324

45.IA.4.4 Import clearance/ Shipping function Control Objective Inspection Nature of Work Step Verification Risk Delay in inspection Nature of Control Manual/Automated

1. To check whether timely inspection of cargo imported is done by the user department. Use T-code MCXB, MCXD to check the quality inspection done for order received.

45.IA.4.5 Import clearance/ Shipping function Control Objective Adherence to the terms and conditions mentioned in the contract Nature of Work Step Verification/Analysis Risk Non Compliance to the terms and conditions mentioned in the contract. Nature of Control Manual/Automated

1. To ensure that correct amount (import duty) due for customs is paid and to check the conditions mentioned in the contract to ensure if the payment is due from OIL's end or exporter's end. Use T-code FBL1N for reference.

2. To check the service contract for air transport and see if the rate is charged as per the contract. Use T-code VA45N to display the list of contracts.

45.IA.4.6 Import clearance/ Shipping function Control Objective Insurance Nature of Work Step Verification Risk Loss of goods. Nature of Control Manual

1. To ensure that marine insurance was taken before the dispatch of goods. 2. To check if there is adequate monitoring of Material in Transit. 3. To ensure that the safety and security risk in transport of explosives to the FHQ is covered

through marine insurance.

45.IA.4.7 Import clearance/ Shipping function Control Objective Release of payment Nature of Work Step Verification Risk Non Compliance. Nature of Control Manual/Automated

1. To check that payment is released only after getting all the clearances. Use T-code MIR4, FBL1N for reference.

45.IA.4.8 Import clearance/ Shipping function Control Objective Port clearance Nature of Work Step Verification/Analysis Risk Delay in Port Clearance. Nature of Control Manual

1. To check the timeliness of port clearance done by OIL's own resources / private party and compare.

Audit Checklist

325

45.IA.5 Air cargo Control Objective License for supply of explosives Nature of Work Step Verification Risk Non Compliance to DGCA Norms. Nature of Control Manual

1. To check whether supplier has provided adequate documentation required for supply. 2. To check whether Explosive license and DGCA permit has been acquired by OIL the supplier for

the explosives received. 3. To check whether explosives license / DGCA clearance and essentiality certificates are timely

obtained.

45.IA.6 Payment Control Objective Adequate monitoring and payment Nature of Work Step Verification/Analysis Risk Inadequate monitoring and payments. Nature of Control Manual/Automated

1. To check the adequate monitoring and payment as per Air Freight contract. Use T-code FBL1N for reference.

2. To check the adequate monitoring and payment of ocean freight charges for orders placed on FOB basis. Use T-code FBL1N for reference.

3. To check if there is adequate monitoring and payment of various port charges. Use T-code FBL1N for reference.

45.IA.7 Statutory Requirements Control Objective Compliance Nature of Work Step Verification Risk Statutory Non Compliance. Nature of Control Manual

1. To check whether there is compliance to the statutory requirements.







Audit Checklist

326

45.IA.9Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material/services Nature of Work Step Verification Risk 1. Delays in payments.








delays.





Audit Checklist

327

46. Wind Energy – Internal Audit

Scope Audit Areas

1 Accounting

2 Maintenance

3 Operations

4 Revenue generation


6 Manpower planning

Audit Checklist

328

46.IA.1 Accounting Control Objective Timely and correct accounting Nature of Work Step Analysis/Verification Risk Books as not been closed as per company policy and on time. Nature of Control Automated/Manual

1. Use T-Code FBL3N to review whether correct and timely accounting is done so as to ensure compliance to generally accepted accounting concepts.

2. Ensure that accounting standards are complied with.

46.IA.2 Revenue generation Control Objective Correct and timely billing to customers as per the billing terms and within

the billing cycles. Nature of Work Step Verification

Risk 1. Non billing to customer on time may lead to long outstanding in books. 2. Delay in collection of funds.

Nature of Control Automated/Manual 1. Use T-Code VF03, VF05, FBL5N, FBL3N to review the revenue sources of the Company and

revenue recognition methodology followed by the Company. 2. Ensure that required accounting standards are complied with for recognition of revenue. 3. Review if any process exists for revenue assurance.

46.IA.3 Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities

Nature of Work Step Verification/Analysis Risk

1. Over/Under Utilization of manpower. 2. Operational delays caused due to low manpower.




Audit Checklist

329

Technical Audit

Audit Checklist

330

3. Chemical – Technical Audit

Scope

Audit Areas


2 Planning, preparation and maintenance of drilling fluid

3 Sampling and testing of mud/cement

4 Sampling and testing of chemicals



7 Issuance of chemicals/spares items/storage


9 Buy vis a vis hiring of chemicals/ equipments




Audit Checklist

331

3.TA.1 Planning, preparation and maintenance of drilling fluid Control Objective Adequate planning, Effective monitoring over plan, Compliance to DOP Nature of Work Step Verification / Analysis Risk 1. Inappropriate approvals.


3. Non compliance to DOP.

Nature of Control Automated / Manual 1. To check whether the plan of Chemical department is complete and all-inclusive for man,

materials, equipment required for preparation and maintenance of Drilling fluid. 2. To check whether such plan is approved by competent authority as per DOP. 3. To check whether any amendments in such plan is approved by competent authority as per

DOP. 4. To check whether actual expenses are monitored / compared with planned expenses on

periodic basis against such plan. 5. To check whether there are laid down procedures for preparation and maintenance of drilling

fluid. 6. To check whether such laid down procedures for preparation and maintenance of drilling fluid

are complied with. 7. To check whether real time monitoring of drilling parameters, mud parameters, formation

parameters, well site activities is undertaken or not.

3.TA.2 Sampling and testing of mud/cement Control Objective Appropriate results of testing

Nature of Work Step Verification Risk 1. Non - adherence to the laid procedures.

2. Unqualified personnel undertaking the said process. Nature of Control Manual

1. To check whether there are laid down procedures to perform sample testing and bulk testing of mud/cement.

2. To check whether such laid down procedures are complied with and its compliance is duly documented.

3. To check whether results of sample testing and bulk testing are revalidated following maker checker control environment.

4. To check whether sample and bulk testing are performed as per the agreed turnaround time (TAT).

5. To verify that only calibrated equipment and qualified personnel's are being used to undertake this process and there is availability of proper infrastructure.

Audit Checklist

332

3.TA.3 Sampling and testing of chemicals Control Objective Appropriate results of testing


Risk 1. Non - adherence to the required sample size. 2. Improper documentation of the testing results.

Nature of Control Manual / Automated 1. To check whether documentation is maintained for incorrect analysis/ report / mismatch in

sample/ records. 2. To check whether any remedial action was undertaken for incorrect analysis/ report /

mismatch in sample.

3. To check whether frequency followed for sample testing is as per defined process.

4. To check whether validation of well site test results is being done in laboratory.

5. To check the report regarding completion of analysis & monitoring of accuracy of testing results by cross laboratory validation [For the sample basis as defined].

6. To check if the pricing and/or realization of the testing services provided to other operators is adequately done. Basis of costing to be verified.

3.TA.4 Environment, health and safety compliance Control Objective Safeguarding interest of Company / employees / public / creatures


Risk 1. Non-compliance to Statutory laws leading to legal hurdles. 2. Dissatisfaction among the employees. 3. Non- adherence to government rulings creating a risk on market reputation.

Nature of Control Manual 1. To check whether there is a compliance framework related to statutory requirement for EH&S. 2. To check whether EH&S compliance framework is monitored and reviewed on regular basis. 3. To check whether compliance of Safety Operating Procedures (SOP) is ensured and

documented. 4. To check whether training is being provided as per job requirement. 5. To check proper sampling and labeling of chemicals is done before providing it to the

customers. 6. To check whether required documents/report/returns are filed on monthly/quarterly/annually

basis to Govt./State Govt./Authorities/Atomic Energy Regulatory Board (AERB). 7. To check whether there is adherence to statutory compliance while handling hazardous

chemicals.

3.TA.5 Issuance of chemicals/spares items/Storage Control Objective Avoiding stock out situation, adequate approvals for issuance, inventory

controls Nature of Work Step Verification/Analysis Risk 1. Inappropriate approvals.

2. Delays in process to monitor and mitigate the delays. Nature of Control Manual/ Automated

1. To check about availability of proper storage system. 2. Use T-code MB5B, MB52 and MC.9 to obtain details of inventory levels and movements. Check

whether there is a process for review of inventory levels of materials/spares items. Also, check whether there is a process for review of inventory levels of spares items.

3. To check whether there is a process for review of inventory levels of chemicals/spares items.

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4. Use T-code MB23 and conduct a walkthrough of the issuance process of chemicals/spares items from stores and identify gaps.

5. Use T-code MB5B and MMBE to obtains details of inventory issued. Check whether approvals for issue of materials/spares items are taken as per DOP.

6. To check whether there is availability of supplier for supplying chemicals in small quantities. 7. To check whether there is a process to monitor and mitigate the delays in supply of mud/ fluid. 8. To check whether there is a process to monitor and mitigate the delays due to unavailability or

loss of critical inventory /apparatus / work over fluid. 9. To check whether there is a process to monitor and mitigate the delays in providing the work

over fluid/ loss of work over fluid due to inefficient planning. 10. To check whether there is a process for monitoring over obsolete / slow / non moving / spares

/chemicals and appropriate decisions are taken for the same. 11. Use MC46 and MC50 for reviewing slow-moving / non-moving inventory.

3.TA.6 Equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Verification / Analysis Risk 1. Idle equipment.

2. Regular breakdowns due to non-adherence to Preventive maintenance schedule.

Nature of Control Manual / Automated 1. Use T-Code IE03 to view the equipment details and check whether the utilization of equipment

is reviewed regularly. 2. Ensure that there is availability of equipment to mobilize resources / carry work. 3. Check whether there is a maintenance schedule (preventive/regular) for equipment and its

compliance. Use T-Code IW39 to display the PM orders and IP24 to display the scheduling overview list form.

4. Check whether monitoring over turnaround time as per schedule and actual time taken for maintenance of equipment is done. Use T-Code IW39 to display the PM orders and IP24 to display the scheduling overview list form.

5. Check whether monitoring is done for compliance to OEM guidelines for operating equipment. Use T-Code IE03 to view the equipment details.

3.TA.7 Creation of Service Entry Sheet (SES) Control Objective Exploiting the best option available Nature of Work Step Analysis / Verification Risk 1. Delays in payments.






creation of SES. 6. Check whether the technical inspection carried out is approved as per DOP.

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7. Check whether there is a process of monitoring the date of completion as mentioned in the contract w.r.t the actual date of completion/creation of SES.

8. Check whether reasoning analysis is done for the delays and steps are taken to avoid similar delays. Check whether cost benefit analysis is done for buying vis a vis hiring of equipment or tools.

3.TA.8 Certification of bills of vendor Control Objective Authorized payment, no duplicity payments Nature of Work Step Analysis / Verification Risk 1. Non- adherence to the process of making payment.

2. Unauthorized payments. 3. Duplicate payments.

Nature of Control Automated / Manual 1. Conduct a walkthrough of certification of bills of vendor. 2. Use T-code FB03/FBL3N and ME2N to check whether vendor's invoices are paid only after

proper supporting documents have been verified and approval is taken as per DOP. 3. Use T-code FBL3N to check whether advance payment made to the vendor is adjusted while

making payment of invoice, if applicable. 4. Use T-code FBL3N to check whether payment is made only against liability created in SAP.

3.TA.9 Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Analysis / Verification Risk 1. Over/Under-utilization of manpower.




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4. Civil – Technical Audit

Scope Audit Areas


2 EHS Compliance


4 Survey (Fields and Projects)

5 Cost estimate

6 Design plan

7 Operations

8 Contracting of civil services

9 Field activities

10 Escalation

11 Issuance of equipment/spares items and storage


13 Buy vis a vis hiring of civil equipment or tools

14 Creation of Service Entry Sheets (SES)

15 Certification of RA bills of vendor

16 Complaints (Township)

17 Miscellaneous activities

18 PR tracking


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4.TA.1 Survey (Fields and Projects) Control Objective Timely and accurate stacking of location


Risk 1. Process gaps in the process of stacking. 2. Late updation to the G&R department.


1. Check whether the preparation of location has been exhaustively done post the release of LAF 1 by geology department and location point is fixed only after discussion with geology and drilling department.

2. Check that the processing time between LAF 1- LAF 2- LAF 3 is not exceeding defined time limit for handover of land to civil.

3. Check that the preparation time taken by civil department is not exceeding defined time limit.

4. To understand the process of stacking of location and identify gaps.

5. Check whether G&R department is timely intimated in case, the specified coordinates cannot be stacked.

6. Check whether LAF-2 is timely approved and sent to the G&R department along with the required estimate for civil job.

7. Check whether cost estimate is prepared by the department before submission of LAF-2.

4.TA.2 Design Plan Control Objective Appropriate design Nature of Work Step Verification Risk 1. Non-adherence to the specified format.

2. Inappropriate designing. Nature of Control Manual

1. Check whether the design/plan is approved timely as per DOP. 2. Check whether the amendments made, if any are timely approved as per DOP. 3. Check whether actual design is compared with planned design and approval is obtained for any

deviations. 4. To ensure that construction has been undertaken as per specification and approved design.

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4.TA.3 Issuance of equipment/spares items and storage Control Objective Avoiding stock out situation, adequate approvals for issuance, inventory

controls Nature of Work Step Analysis / Verification Risk 1. Inappropriate inventory controls and monitoring of inventory levels.

2. Inappropriate approvals.


1. Use T-code MB5B, MB52 and MC.9 to obtain details of inventory levels and movements. Check whether there is a process for review of inventory levels of materials/spares items. Also, check whether there is a process for review of inventory levels of spares items.

2. Check whether there is a buffer stock buildup of construction material. 3. Check about availability of proper storage system. 4. Conduct a walkthrough of the issuance process of materials/spares items from stores and

identify gaps. 5. Use T-code MB5B and MMBE to obtains details of inventory issued. Check whether approvals

for issue of materials/spares items are taken as per DOP. 6. Check whether the materials issued to contractors are monitored and deduction, if applicable as

per contractual terms is made at the time of payment. 7. Use T-code MB5B, MB52 and MC.9 to obtain details of inventory levels and movements. Ensure

that there is identification of critical spares and process of maintaining of appropriate inventory level exists.

8. Use T-code MC46 and MC50 for inventory ageing and check whether there is a process for monitoring over obsolete / slow / non moving / materials or spares and appropriate decisions are taken for the same.

9. Check whether adequate insurance cover has been obtained for the items stored. 10. Check whether there is a process of monitoring inventory levels and obtaining additional

insurance cover, if required.

4.TA.4Equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Analysis / Verification Risk 1. Idle equipment.

2. Regular breakdowns due to non-adherence to preventive maintenance schedule.


1. Use T-Code IE03 to view the equipment details and check whether the utilization of equipment is reviewed regularly.

2. Ensure that there is availability of equipment to mobilize resources / carry work. 3. Check whether there is a maintenance schedule (preventive/regular) for equipment and its


4. Check whether monitoring over turn around time as per schedule and actual time taken for maintenance of equipment is done. Use T-Code IW39 to display the PM orders and IP24 to display the scheduling overview list form.


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delays. 9. Check whether cost benefit analysis is done for buying vis a vis hiring of equipment or tools.

4.TA.6 Complaints (Township) Control Objective Resolution of complaints Nature of Work Step Verification Risk Non - resolution of complaints Nature of Control Manual

1. To ensure that there is timely resolution of township complaints.

4.TA.7 Miscellaneous civil jobs Control Objective Monitoring and processing of miscellaneous civil jobs Nature of Work Step Analysis / Verification Risk 1. Delays in execution.

2. Improper estimation of miscellaneous jobs. Nature of Control Automated / Manual

1. To ensure that correct estimation is done for miscellaneous jobs. 2. Use T-Code ME2N to verify that PR (Using appropriate PR type) have been raised for all

miscellaneous jobs. 3. To ensure that ancillary jobs (CISF camps, sheds, canteens, pillars etc.) are carried out through

contracts on basis of rate contracts. 4. Check whether the task of strengthening of the foundation of bridges (breach of which results in

floods during heavy rains/ foundation failure due to earthquake) is undertaken during the dry season.

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5. Contracts – Technical Audit

Scope Audit Areas

1 Purchase requisition and budget

2 Procurement

3 Cost estimate

4 Invitation for Bidding (IFB) in case of open bidding



7 Bidding process

8 Relaxation of standard terms and conditions

9 Open bidding

10 Limited bidding/ Single bidding

11 Receipt of bid

12 Opening of bid

13 Preliminary examination and comparison of bids

14 Evaluation of bids, preparation of Tender Committee Resolution (TCR) and award & signing of the contract

15 Commencement of work and issue of work order and monitoring of work

16 Liquidated damages

17 Retention money

18 Extension of contract period

19 Variation in contract

20 Extra / Substituted items

21 Escalation

22 Payment

23 Closure of contract

24 Performance appraisal

25 Bid security


27 Monitoring of lead times from PR to awarding of contract

28 PR tracking



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5.TA.1.1 Pre-bid conference Control Objective Compliance to Purchase Manual, Transparency in process Nature of Work Step Verification Risk 1. Legal hurdles resulting from non-transparent process being followed.

2. Non-compliance to Purchase manual. Nature of Control Manual

1. Check whether pre-bid conference is held only after approval from competent authority. 2. Check whether only the parties who had bought the Bid Documents are invited to attend the

Pre-bid Conference. 3. Check whether senior most officer from the Indenting Department along with the

representative from Materials Department and Finance is present at the Pre-Bid Conference. 4. Check whether the minutes of the meetings are prepared and signed off by all the attendees. 5. Check whether the changes made, if any in PBC are approved by competent authority and

communicated to the bidders through fastest means of communication. 6. Check whether new bidders are invited for participation only if there is any major change in the

qualifying criteria. 7. Check if approval is taken as per DOP in case the sale of bid documents is initiated again.

5.TA.1.2 Pre-bid conference Control Objective To verify that the extension of bid entering date is authorized in writing by

the competent authority. Nature of Work Step Verification Risk Non compliance to DOP / MM Manual may result in:

a. unauthorized procurement of material / services b. procurement of material / services in excess of requirement c. Finalization of order on uncompetitive terms & conditions.

Nature of Control Automated / Manual 1. Check for the tenders for which bid entering date was extended. Use T-code ZMMTENDER3

/ZMMBIDEXTN. 2. Check if the competent authority has approved the extension as per DOP/MM Manual. 3. Obtain the reason for exceptions and report the same.

5.TA.2 Relaxation of standard terms and conditions Control Objective Compliance to DOP Nature of Work Step Verification Risk 1. Incompleteness of notice inviting tenders.

2. Inadequate documentation in contract file. Nature of Control Automated / Manual

1. Check whether in case of OEM (original equipment manufacturer) Services / proprietary Services, the competent authority as per DOP approves the relaxation of standard terms and conditions of work orders / contracts for the OEM / manufacturer of proprietary items/ Services. Use T-Code ZMMTENDER3 / ME43 / ME33K /ME3L and ME3N.

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5.TA.3.1 Commencement of work and issue of work order and monitoring of work Control Objective Compliance of Statutory requirements, accuracy in order placement, Inclusion

of standard terms and conditions Nature of Work Step Analysis / Verification Risk Non-compliance to Statutory framework.

Nature of Control Automated / Manual 1. Check whether that after signing the contract, the contractor has submitted the labor license

and the certificates relating to compliance with the statutory requirements as may be required for the specific contract.

2. Check whether that after fulfilling the statutory compliance, the work order has been issued by the use department to the contractor.

3. Check whether there is a maker checker control for preparation and release of work order. The relevant T-code in SAP- ME23N, ME2L, ME33K.

4. Verify that the WO contains standard terms and conditions safeguarding Company's interest e.g. insurance, timely delivery, payment etc. The relevant T-code in SAP- ME23N, ME2L, ME33K.

5. Ensure that the price mentioned in the WO is same as that mentioned in the contract. The relevant T-code in SAP- ME23N, ME2L, ME33K.

5.TA.3.2 Commencement of work and issue of work order and monitoring of work Control Objective Appropriate monitoring of the contractual terms Nature of Work Step Analysis / Verification Risk 1. In absence of a log, the process owner may make an error in certifying the

service entry sheet, which serves as a basis of Invoice verification and vendor payment. 2. Financial loss due to incorrect certification of the services received in terms of quality / quantity.

Nature of Control Automated / Manual 1. Use T-Code ME23N, ME2S to obtain a list of work orders against which work has been done and

service entry is pending. 2. Verify with the process owner / Engineer in charge as to whether they have kept independent

log of work done by vendor. 3. Discuss & report any exceptions.

5.TA.3.3 Commencement of work and issue of work order and monitoring of work Control Objective Penal deductions are made as per contract Nature of Work Step Verification Risk 1. Non recovery of penalties from vendor.

2. Violation of work order/contract conditions. Nature of Control Automated / Manual

1. Use T-Code ME23N, ME2S, ME33K, ME2N to obtain a list of work order/contract given during the review period.

2. Analyze the cases where any deductions on account of delayed delivery, other breach of contract should have been recovered from the vendor invoice.

3. Discuss and report any cases where appropriate deductions have not been made.

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5.TA.4 Extra / Substituted Items Control Objective Appropriate payment on account of extra items Nature of Work Step Analysis / Verification Risk Inappropriate payments. Nature of Control Automated / Manual

1. Check whether sanction for extra and substituted items and rates are approved as per DOP. The relevant T-code in SAP- ME23N, FBL1N, MIR4.

2. Check whether the rates for the extra items are worked out at OIL SOR/CPWD/PWD on contractor’s quoted percentage on the original contract items whichever is lower prevailing at the time of commencement of execution of these items.

3. Check whether for substituted items, the agreement rate of the original item are adjusted for the difference in agreed rate of original and substituted items. The relevant T-code in SAP- ME23N, ME33K, FBL1N, MIR4.

5.TA.5 Performance appraisal Control Objective Maintaining history of contractor performance for future reference Nature of Work Step Verification Risk Inadequate documentation. Nature of Control Manual

1. Check whether a process for performance appraisal is undertaken as per the Contract Manual. 2. Check whether a file for each contractor is prepared to keep record of their performance. 3. Check whether a performance report is submitted by Head (Indenting Department) to Head

Contract at the time of preparation of final bill / completion of work.

5.TA.6 Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material / service Nature of Work Step Verification Risk 1. Delays in payments.

2. Incorrect payments. Nature of Control Automated / Manual







delays.

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7. Drilling – Technical Audit

Scope Audit Areas


2 Inter-location movement

3 Drilling operations





8 Buy vis a vis hiring of well equipment/rigs


10 PR tracking



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7.TA.1 Inter – Location Movement Control Objective Timely delivery of equipment to avoid delays, control over transit

loss/pilferage Nature of Work Step Verification / Analysis Risk 1. Delay in delivery of equipment and material.

2. Loss of material and unauthorized adjustments. Nature of Control Manual / Automated

1. Use T-Code CJ20N for obtain and verify the drilling plan. Check whether plan is prepared and monitored for movement of drilling equipment, consumables, and other support equipment from one location to another.

2. Check whether such movement plan of equipment is aligned with drilling program/plan communicated by G&R department in terms of capacity/type of equipment.

3. Check whether movement plan of equipment is timely communicated to Transport department. 4. Check whether cleaning and dressing of forward well plinth is done before placement of

equipment/Rigs. 5. Check whether equipment/Rigs are loaded after proper boxing up of all materials and in

supervision of competent authority. 6. Use T-code IE03 to display equipment installed or being used at the drilling site. Check whether

the drilling equipment, consumables and other support equipment are loaded and transferred timely and in sequential manner to the drilling site as per drilling / rig movement plan.

7. Use T-code IH08 to display equipment installed or being used at drilling site. Check whether physical count of each drilling equipment, consumables and other equipment is performed and documented before any movement and the same is documented.

8. Use T-code MB5B, MB52, MC.9 to obtain the details of inventory and movement of material. Check whether reconciliation of physical count performed vis a vis receipt of all equipment, consumables at drilling site is performed.

9. Use T-code MB03 to obtain the details of inventory adjustments. Check whether any variances while reconciliation are reported and adjusted in SAP after approval as per DOP.

7.TA.2.1 Drilling Operations. Control Objective Effective execution of drilling activities (Rig down/rig up/drilling

conductor/drilling isolation/drilling oil string/ drilling wire line survey/ production testing) , adequate monitoring, avoiding accidents

Nature of Work Step Analysis / Verification Risk 1. Inadequate execution.

2. Delay in execution. 3. HSE Risk. 4. Inadequate utilization of resources.

Nature of Control Automated / Manual 1. Check whether installation and drilling activities are carried out as per Drilling program

circulated by G&R department. 2. Check that proper drilling parameter is used so as to ensure proper drilling and casing of hole. 3. Check whether prolonged production testing is leading to loss of rig time. 4. Check whether any deviation in carrying out installation and drilling activities are informed to

G&R department well in advance and the approval for the same is obtained. 5. Check whether timelines are monitored in carrying out each defined activities of installation and

drilling in drilling program. 6. Check whether root cause analysis is performed for any delays in carrying of installation and

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drilling activities. 7. Ensure that there is efficient functioning of the process due to compliance to policies and

procedures defined. 8. Check whether well plinth, and all infrastructures are ready and free from all hazards before

spud in. 9. Check whether wire line survey is carried out.





Nature of Control Automated / Manual 1. Use T-code IK07 and IK17 to give the list of measuring points and corresponding measuring

documents searching by maintenance plant. Check whether cycle speed (rig up to rig up at next location) and Commercial speed (spudding to well completion) are closely monitored and benchmarked to ensure efficient utilization of drilling rigs.

2. Check whether pre spud meeting is carried out before spud in well. 3. Check that well plinth, and all infrastructures is ready and free from all hazards before spud in. 4. Ensure that adequate training of employees has been undertaken, in order to avert accidents.





Nature of Control Automated / Manual 1. Ensure that there is adequate clarity of roles and responsibilities of the employees working on

drilling operations. Use T-code SU03.2. Ensure that there is adequate definition of roles and responsibilities of the employees working on drilling operations.

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Nature of Control Automated / Manual 1. Ensure that there is adequate cementing of the drilling wells. 2. Check hydrocarbon is produced from wellbore in a controlled manner to prevent damage to the

reservoir. 3. Check whether drilling targets are achieved as planned. 4. Check that the drilling and casing of the hole is as per well policy.

7.TA.2.5 Drilling Operations. Control Objective To verify optimal drilling time Nature of Work Step Analysis / Verification Risk 1. Non - utilization of drilling rig.

2. Excess payment to vendor. Nature of Control Automated / Manual

1. Obtain the daily progress reports (DPR) for drilling. 2. Compare the drilling time to the standard drilling time for similar sands/ regions and depth. 3. In case of delays, go through the root cause analysis. 4. Make note of discrepancies if any.

7.TA.2.6 Drilling Operations. Control Objective Ensure optimal cycle speed and commercial speed for each rig. Nature of Work Step Verification Risk 1. Non - utilization of drilling rig.

2. Excess payment to vendor. Nature of Control Manual

1. Ensure that cycle and commercial speed for each well was planned in advance. 2. Compare actual vs. planned cycle and commercial speed. 3. Discuss reasons for discrepancies if any.

7.TA.3 Issuance of materials/spares items Control Objective Avoiding stock out situation, adequate approvals for issuance, inventory

controls Nature of Work Step Analysis / Verification Risk 1. Delay in procurement and availability of material.

2. Non moving inventory blocking the working capital. Nature of Control Automated / Manual

1. Use T-code MB5B, MB52 and MC.9 to obtain details of inventory levels and movements. Check whether there is a process for review of inventory levels of materials/spares items.

2. Conduct a walkthrough of the issuance process of materials/spares items from stores and identify gaps.


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4. Use T-code MB5B, MB52 and MC.9 to obtain details of inventory levels and movements. Ensure that there is identification of critical spares and process of maintaining of appropriate inventory level exists.




7.TA.4 Certification of bills of vendor Control Objective Authorized payment, no duplicity payments Nature of Work Step Analysis / Verification Risk 1. Unauthorized payment.

2. Excess payout to vendor. Nature of Control Automated / Manual

1. Conduct a walkthrough of certification of bills of vendor. 2. Use T-code FBL1N for obtaining vendor ledger and MIR4 for details of invoice. Check whether

vendor's invoices are paid only after proper supporting have been verified and approval is taken as per DOP.

3. Use T-code FBL1N for obtaining vendor ledger. Check whether advance payment made to the vendor is adjusted while making payment of invoice, if applicable.

4. Check whether payment is made only against liability created in SAP.

7.TA.5 Environment, health and safety compliance Control Objective Safeguarding interest of Company / employees / public / creatures Nature of Work Step Verification Risk 1. Statutory non compliance.

2. Risk of adverse impact on Health, safety and Environment and penal consequences.

Nature of Control Automated / Manual 1. Check whether there is a compliance framework related to statutory requirement for EH&S. 2. Check whether EH&S compliance framework is monitored and reviewed on regular basis. 3. Check whether compliance of Safety Operating Procedures (SOP) is ensured and documented. 4. Check whether documentation required by various regulatory bodies (OISD, DGMS, PCB etc.) is

complete and timely submitted. 5. Check whether adequate number of Personal protective Equipment (PPE) is present at drill site. 6. Check whether adequate numbers of safety officers are deployed at the drill site. 7. Use T-code S_ALN_01001342,S_ALN_01001343 to list agents and safety measures for a work

area and person respectively. Check measures are adopted for safety of personnel/ well safety/ rig equipment.

8. Use T-code S_ALN_01001342 to list agents and safety measures for a work area. Ensure that there is no damage to the equipment due to inadequate safety at the site.

9. Check that all precautions as per SOP is done prior to hermetical testing of the production casing.

10. Use T-code S_SH8_72000033 for evaluating a completed questionnaire. Check whether necessary environmental approvals/clearances are obtained before start of drilling activities.

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7.TA.6 Equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Analysis / Verification Risk Ineffective utilization of resources and financial loss. Nature of Control Automated / Manual

1. Use T-code IK07 for obtaining the list of measure points searching by maintenance plant. Check whether the utilization of equipment/Rigs (owned or outsourced) is reviewed regularly.

2. Use T-code IE03,IK07, IK17 for displaying equipment and equipment status, list of measure points and corresponding measuring documents searching by maintenance plant respectively. Ensure that performance of outsourced/contractual rigs is consistently monitored and evaluated.

3. Use T-code IE03, IH08 to display equipment and corresponding equipment information and status. Check that there is availability of critical equipment (Drilling rigs etc.) as and when required.

4. Use T-code IP24 for viewing the overview of the scheduling list. Check whether there is a maintenance schedule (preventive/regular) for equipment and its compliance.

5. Use T-code IP24 and IW39 for viewing overview of scheduling list and for obtaining the work order listing respectively. Check whether monitoring over turn around time as per schedule and actual time taken for maintenance of equipment is done.

6. Use T-code IP24 and IW39 for viewing overview of scheduling list and for obtaining the work order listing respectively. Check whether the equipment (owned or outsourced) are calibrated regularly.

7. Use T-code S_ALR_87013421 for displaying the measurement entry reading list. Check whether there is adequate capturing / monitoring of rig downtime, movement time, idle time to ensure optimal utilization of rigs and other drilling equipment.

8. Check whether that equipment or technology in use are appropriate in terms of present technology.

9. Check whether cost benefit analysis is performed before proposing new equipment or technologies.

10. Ensure that dual records (manual and in SAP) maintenance is not taking place. 11. Use T-code IA07 and IW39 for displaying the general task list and displaying the work order

listing respectively. Check whether monitoring is done for compliance to OEM guidelines for operating equipment.

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350

7a. Technical Services (Drilling) – Technical Audit

Scope Audit Areas


2 TS drilling operations





7 Buy vis a vis hiring of servicing equipment


9 PR tracking



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7a.TA.1 TS drilling operations Control Objective Effective execution of TS drilling activities, adequate monitoring Nature of Work Step Verification / Analysis Risk Inadequate monitoring and ineffective execution.

Nature of Control Automated / Manual 1. Check whether preventive or regular maintenance schedules are exist for various types of

drilling/work over equipment/Rigs. SAP T-codes reference for reports / verification IP24, IW23, IW39.

2. Check whether such maintenance schedules are monitored and followed for all drilling/work over equipment/Rigs. SAP T-codes reference for reports / verification IP24, IW23, IW39.

3. Check whether for any deviation in compliance to such maintenance schedule, necessary approvals are obtained from the competent authority as per DOP.

4. Check whether estimate is prepared for adhoc services. SAP T-codes reference for reports / verification CJ20N.

5. Check whether necessary approvals for estimate are obtained from the competent authorities as per DOP before carrying out any services.

6. Check whether maintenance history of each service of drilling/work over equipment/Rigs is maintained. Use T-code IW39, IW73.

7. Check whether warranty / guarantees / insurance claims are availed wherever applicable for replacement or repair of any spares/part. SAP T-codes reference for reports / verification IE03.

8. Check whether turn around Time (TAT) for carrying out technical services is defined for various type of services.

9. Check whether actual TAT taken to carry out technical services is tracked against defined TAT of various services.

10. Check whether attendance of deployed labor is recorded and approved by the competent authority as per DOP.

11. Check whether overtime hours of labor is justified and approved by the competent authority as per DOP.

7a.TA.2 Issuance of materials / spare items Control Objective Avoiding stock out situation, adequate approvals for issuance, inventory

controls Nature of Work Step Verification / Analysis

Risk Ineffective inventory control. Nature of Control Manual / Automated






6. Check whether adequate insurance cover has been obtained for the items stored.

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7. Check whether there is a process of monitoring inventory levels and obtaining additional insurance cover, if required.

7a.TA.3 Certification of bills of vendor Control Objective Authorized payment, no duplicity payments


Risk 1. Unauthorised Payments. 2. Duplicate Payments.

Nature of Control Manual / Automated 1. Conduct a walkthrough of certification of bills of vendor. 2. Check whether vendor's invoices are paid only after proper supporting documents have been

verified and approval is taken as per DOP. SAP T-codes reference for reports / verification MIR4, FBL3N.

3. Check whether advance payment made to the vendor is adjusted while making payment of invoice, if applicable. SAP T-codes reference for reports / verification MIR4, FBL3N.

4. Check whether payment is made only against liability created in SAP. SAP T-codes reference for reports / verification MIR4, FBL3N.

7a.TA.4 Environment, health and safety compliance Control Objective Safeguarding interest of Company / employees / public / creatures Nature of Work Step Verification Risk Non Compliance to EH&S. Nature of Control Manual / Automated

1. Check whether there is a compliance framework related to statutory requirement for EH&S. 2. Check whether EH&S compliance framework is monitored and reviewed on regular basis. 3. Check whether compliance of Safety Operating Procedures (SOP) is ensured and documented.

Use Transaction codes S_SH8_72000033. 4. Check whether documentation required by various regulatory bodies (OISD, DGMS, PCB etc.) is

complete and timely submitted. Use SAP T-codes CV03N.

7a.TA.5 Equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment. Nature of Work Step Verification / Analysis Risk 1. Non Compliance to OEM Guidelines.

2. Improper maintenance of Equipment. 3.Use of outdated technology.

Nature of Control Manual / Automated 1. Use T-Code IE03 to view the equipment details (owned or outsourced) and check whether the

utilization of equipment is reviewed regularly. 2. Ensure that there is availability of equipment to mobilize resources / carry work. 3. Check whether there is a maintenance schedule (preventive/regular) for equipment and its




6. Check whether that servicing equipment or technology in use are appropriate in terms of present technology.

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7. Check whether cost benefit analysis is performed before proposing new servicing equipment or technologies. SAP T-codes reference for reports /verification- KSBL.

7a.TA.6 Creation of Service Entry Sheet (SES) Control Objective Exploiting the best option available Nature of Work Step Analysis / Verification Risk 1. Delays in payments.









7a.TA.7 Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Analysis / Verification Risk 1. Over/Under-utilization of manpower.




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8. Electrical – Technical Audit

Scope Audit Areas



3 PR tracking


5 Manpower planning


7 Distribution

8 Operations

9 Maintenance

10 SOP compliance


12 Safety


14 Security



17 HSE compliances

Audit Checklist

355

8.TA.1 P&A -Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material / service


Risk 1. Delays in payments. 2. Incorrect payments.

Nature of Control Automated / Manual 1. Check whether status of work completion in manual records is updated as per contract terms.

Use T-code ME2S/MSRV1. 2. Check whether confirmation or acknowledgement of work completed is taken from contractor

on manual records. 3. Check whether the manual records are verified and approved by concerned authority. 4. Use T-Code ML84 to view the list of SES's and ML81N to view the details of specific SES. Check




delays.

8.TA.2 Distribution Control Objective To ensure timely and efficient distribution of power. Nature of Work Step Verification Risk 1. Delay in distribution of power.

2.Non-availability of spares. Nature of Control Manual / Automated

1. Check the distribution network is identified and well established to cover all requirements. 2. Check any compliant received and timely action is taken to resolve the same. 3. Check for delays from procuring the product to issuing resulting in stoppage of production. Use

SAP T-code MB52. 4. Check that necessary spares are available within the department to provide maintenance

services. Use SAP T-code MMBE. 5. Check if distribution lines are periodically maintenance to prevent and breakdown. Use T-code

IP24. 6. Check if proper analysis is carried for downtime (if any) and action plan is prepared to prevent

future breakdown. Use T-code IP24.

8.TA.3.1 Power Generation - Operations

Control Objective To ensure generation is planned and raw material is available for production. Nature of Work Step Verification Risk 1. Unplanned Power generation.

2 . Unavailability of raw material. Nature of Control Manual / Automated

1. Ensure that requirement of gas / any other raw material is planned as per the production plan. 2. Ensure that input gas / any other raw material is monitored appropriately and periodic

calibration of equipment in done.

Audit Checklist

356

8.TA.3.2 Power Generation - Operations Control Objective To ensure that the power generation plan addresses the power to be

wheeled or imported Nature of Work Step Verification Risk Excess or insufficient power generation. Nature of Control Manual

1. Obtain the power generation plan. 2. Verify that the plan contains the quantity of power to be wheeled into the grid or imported.

8.TA.3.3 Power Generation - Operations Control Objective To ensure plant is utilized for optimum capacity Nature of Work Step Analysis / Verification Risk Under-utilization of plant. Nature of Control Manual/ Automated

1. Ensure that plant utilization is as per budgeted norms and reasons for any deviations have been identified and documented. Use T Code S_ALR_87013099 to check the actual vs. budget cost and ensure approval has been taken in case the budgeted cost has been exceeded.

2. Obtain the details of the power generated and gas consumed. 3. Compare the power generated versus consumption. 4. Check the plant load factor. Obtain reasons if plant load factor is not achieved.

8.TA.3.4 Power Generation - Operations Control Objective To ensure whether a cost benefit analysis is done for determining whether to

generate captive power or procure power from the state. Nature of Work Step Analysis / Verification Risk Loss of working capital and revenue. Nature of Control Manual

1. Acquire per unit cost of obtaining electricity from Government. 2. Calculate per unit cost of electricity generation after considering depreciation and capital

invested.

8.TA.3.5 Power Generation - Operations Control Objective To ensure that adequate back up options are available should the captive

power plan trip Nature of Work Step Verification Risk Loss of power may lead to stoppage of operations leading to loss of

production / revenue. Nature of Control Manual

1. Validate that standby power generators are in up and running condition. 2. Check if standby power purchase agreements are signed with state or alternative suppliers of

power. 3. Check the validity of these agreements.

8.TA.3.6 Power Generation - Operations Control Objective Break-down Analysis Nature of Work Step Analysis / Verification Risk Lack of Documentation. Nature of Control Manual

1. Check for stoppages which were not planned and whether reasons for such stoppages was identified and documented.

Audit Checklist

357

8.TA.3.7 Power Generation - Operations Control Objective Input / Output reconciliation Nature of Work Step Analysis / Verification Risk Raw material not fed as per defined efficiency of the turbine. Nature of Control Automated / Manual

1. Check whether amount of raw material fed is as per defined / budgeted efficiency of the turbine. In cases of any deviations if reasons for the same are identified. Use T-ode S_ALR_87013095.

8.TA.4 Power Generation - Maintenance Control Objective Timely availability of spares parts and minimum break-downs. Nature of Work Step Analysis / Verification Risk 1. Non availability of spares.

2.Break-downs. Nature of Control Manual/ Automated

1. Check for delays from procuring the spares to issuing resulting in stoppage of production. Use T Code ME2J. Check whether any delays have been observed due to non-availability of spares.


3. Check that necessary spares are available within the department to provide maintenance services. Use T Code MB52.

4. Check whether preventive maintenance has been carried out as per defined schedule. Use T Code IP24, IW23, IW39.




8.TA.5.1 Service Colony and Industrial Building, Air Conditioners, Production Installations,

Projects, Rigs – Service (Operations) Control Objective Completion of work on time, distribution channels Nature of Work Step Verification Risk Delay in completion of work. Nature of Control Manual

1. Check whether service is availability 24*7 to ensure timely service of any electrical breakdown. 2. Check for delay in providing maintenance services resulting in loss of operational efficiency. 3. Check that manpower are allocated as per plan only so as to avoid any delay. 4. Check that adequate maintenance is carried out on timely basis to avoid power breakdown. Use

T-code IP24. 5. Check that energy audit is conducted on time. 6. Check if controls are in place to ensure efficient utilization of power. 7. Check that recommendations of energy audits are complied with. 8. Check that statutory compliance checklist is analyzed and updated regularly. Use T-Code IW38. 9. Check whether required energy meters are installed to measure consumption of power in

residential areas, market places, hospital, industrial installation, official building and any other location where power is being supplied.

Audit Checklist

358

8.TA.5.2 Service Colony and Industrial Building, Air Conditioners, Production Installations,

Projects, Rigs – Service (Operations) Control Objective To ensure that site diesel generator fuel consumption and efficiency is

monitored on a continuous basis Nature of Work Step Analysis / Verification Risk Unauthorized issue and inaccurate consumption of diesel. Nature of Control Manual / Automated

1. Check if the company has defined policies and procedure (SOP) related to consumption of material.

2. Validate that the material is consumed at the same well to which the material is issued. Use T-code MB51.

3. Understand the process of making SAP entries related to consumption. 4. Cross check the issues quantity vis a vis the consumed quantity.

8.TA.6 Service Colony and Industrial Building, Air Conditioners, Production Installations,

Projects, Rigs - Safety Control Objective Availability of protective devices, strict adherence to safety measures Nature of Work Step Verification Risk Non-adherence to safety measures. Nature of Control Manual / Automated

1. Check the maintenance service schedule of power lines. Use T-code IP24. 2. Check whether safety devices are kept for maintenance people and no one is allowed entry

without them. 3. Check any other area of major safety lapse.


Projects, Rigs - Training to workers Control Objective Providing on site and off site training Nature of Work Step Verification Risk Untrained Workers.

Nature of Control Manual 1. Check if the training is scheduled for all employees based on need identification. 2. Check steps taken to update workers with new machinery and technology. 3. Check if all mandatory and statutory trainings are provided to all workers. 4. Check if performance is analyzed and training needs are identified on the basis of same.


Projects, Rigs - Tools, spares and other expenses Control Objective To ensure adequate controls over expenses Nature of Work Step Analysis / Verification Risk Non Compliance to DOP.

Nature of Control Automated / Manual 1. Check if expenses are incurred within the approved budget. Use T-code S_ALR_87013558. 2. Check if all indenting is approved as per DOP. Use T-code ME53N. 3. Check all procurement is carried out as per defined company policy. Use T-codes ME53N,

ME23N. 4. Check if amount spent is adequately utilized for the purpose.

Audit Checklist

359

11. Exploration & Development (ED) – Technical Audit

Scope Audit Areas

1 Acquisition of blocks

2 Monitoring of blocks

3 PR Tracking

4 Manpower Planning


6 Technical Support

7 Financial Review

8 IT Infrastructure

9 Legal Aspects

10 PR Tracking



13 Monitoring of Operator function and financial probity

Audit Checklist

360

11.TA.1.1 ED - Acquisition of blocks Control Objective Adequate evaluation of offers for overseas operating property/assets for OIL

participation in Bidding Nature of Work Step Analysis / Verification Risk Inadequate evaluation. Nature of Control Manual

1. Check if adequate evaluation of offers for overseas operating property / assets was performed.

11.TA.1.2 ED - Acquisition of blocks Control Objective Geotechnical study of properties/ assets before release of locations Nature of Work Step Analysis / Verification Risk Delay in release of locations. Nature of Control Manual

1. Check whether there was systematic collection and analysis of data for release of locations.

11.TA.1.3 ED - Acquisition of blocks Control Objective Effective liaison with Government / Regulatory Agencies Nature of Work Step Analysis / Verification Risk Delay in resolution of block/PSC related issues. Nature of Control Manual

1. Check whether there was adequate coordination/liaison with both internal and external agencies like DGH/ MoP&NG to facilitate timely resolution of block / PSC related issues and provide information / data/ reply/ clarifications on time.

11.TA.1.4 ED - Acquisition of blocks Control Objective Adherence to PSC for submission of periodic statements Nature of Work Step Analysis / Verification Risk Non-adherence to PSC terms. Nature of Control Manual

1. Check whether periodic statements, e.g., Statement of Cost, Expenditures and Receipts, etc., are furnished as required by the PSC as per the timelines stipulated in the PSC.

11.TA.1.5 ED - Acquisition of blocks Control Objective Review of Minimum Work Program (MWP) before submission of the bid Nature of Work Step Analysis / Verification Risk Over commitment in the work program. Nature of Control Manual

1. Check whether there was adequate review of basis of preparation of work program and budgets - its accuracy, completeness and authenticity.

11.TA.1.6 ED - Acquisition of blocks Control Objective Adequate Approval of Budgets and Work Program Nature of Work Step Analysis / Verification Risk Inadequate approvals. Nature of Control Manual

1. Check whether work programs and budgets were submitted to the Operating Committee and the Management Committee as per the stipulated timelines.

11.TA.2.1 ED - Monitoring of blocks Control Objective Monitoring of projects (under E&D Dept.) for timely implementation of MWP

Audit Checklist

361

in OIL’s NELP/ JV/Overseas blocks Nature of Work Step Verification/ Analysis Risk Delays in MWP Nature of Control Automated / Manual

1. Check whether adequate inputs were provided by E&D at different stages of work program execution for taking proactive measures to avoid delays and thereby minimizing liabilities.

2. Check whether there was adequate monitoring of overseas blocks in where OIL is the operator / non-operator in block.

3. Understand and review the monitoring process to ensure actual exploration meets planned targets on annual basis. Use T Code S_ALR_87015125.

11.TA.2.2 ED - Monitoring of blocks Control Objective Periodic techno-commercial review of actual outcome vis-à-vis estimates Nature of Work Step Verification / Analysis Risk 1. Non-compliance to internal policies and contractual terms.

2. Cost Overrun 3. Inability to meet projections.

Nature of Control Automated / Manual 1. Whether the budgets vs. actuals are monitored on a periodic basis and corrective actions are

taken wherever required. Use T Code S_ALR_87013557 and using cost center. 2. Whether the approval of the Operating Committee and the Management Committee is

obtained, in case, actual expenses exceed budgeted expenses for each line item of the budget at the point of time stipulated in PSC and the JOA.

3. Whether any activity is undertaken which is beyond the approved Work programs and Budgets. Verify from project report and expenses booked in SAP in cost center / project.

11.TA.2.3 ED - Monitoring of blocks Control Objective The management committee and the operating committee approves/reviews

all the joint venture related issues and documents. Nature of Work Step Verification Risk 1. Non compliance to internal policies

may lead to disputes 2. Carrying on unauthorized activities

Nature of Control Manual 1. Verify procedure around approval & review of following by Operating & management

committee: a. Minimum work program. b. Annual Budget. c. Revision of Budget. d. Authorization for Financial Expenditure / Authorized Expenditure Request. e. Progress of the work. f. Cash call. g. Costing basis. h. Preparation & Circulation of MIS.

Audit Checklist

362

11.TA.3 ED - Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material / service









delays.

11.TA.4.1 CEMG - Technical Support Control Objective Acquisition of blocks

Nature of Work Step Verification / Analysis Risk Incorrect evaluation. Nature of Control Manual

1. Review the process followed by CEMG for due diligence/evaluation of strategic alliances through

Joint bidding and farm out/farm in.

11.TA.4.2 CEMG - Technical Support Control Objective Standardization of agreements

Nature of Work Step Verification / Analysis Risk Non-standard agreements which may lead to non-compliances. Nature of Control Automated / Manual

1. Evaluate the process followed for standardization of agreements like PSC, JOAs etc.

2. The process should consist of the following steps -

a. Comparison of change in clauses in PSC/JOA from old to new blocks

b. Monitoring of LD/cost of unfinished work program

c. Use T Code CV03N.

11.TA.4.3 CEMG - Technical Support Control Objective Adequate controls over exploration related jobs

Nature of Work Step Verification / Analysis Risk Delays in contracts. Nature of Control Manual

1. Check the process of preparation, finalization and monitoring of contracts by CEMG for the

exploration related jobs outside North East.

Audit Checklist

363

11.TA.4.4 CEMG - Technical Support Control Objective Adherence to MWP requirements to avoid delays and thereby minimizing

liabilities Nature of Work Step Verification / Analysis Risk Non-adherence to MWP. Nature of Control Manual

1. Understand and review the support provided to management by CEMG with project related vital

inputs at different stages of work program execution.

11.TA.4.5 CEMG - Technical Support Control Objective Timely implementation of projects

Nature of Work Step Verification / Analysis Risk Delays in projects. Nature of Control Manual

1. Understand and review the process of monitoring of Pre NELP/NELP/JV Blocks by CEMG to

ensure compliance of contractual timelines and total adherence to related Government

guidelines and policies.

11.TA.4.6 CEMG - Technical Support Control Objective Effective liaison with Government / Regulatory Agencies

Nature of Work Step Verification / Analysis Risk Delay in resolution of block/PSC related issues. Nature of Control Manual

1. Review the liaison process followed by CEMG with internal and external agencies like

DGH/MoP&NG to facilitate timely resolution of block/PSC related issues.

11.TA.4.7 CEMG - Technical Support Control Objective Monitoring of block issues

Nature of Work Step Verification / Analysis Risk Financial loss due to penalties. Nature of Control Manual

1. Check the process followed by CEMG to resolve the block issues like change of phase,

relinquishment, deposit of LD/BG, cost of unfinished work program etc.

11.TA.5.1 CEMG - IT Infrastructure Control Objective Adoption of suitable applications so as get desired results from analysis Nature of Work Step Verification / Analysis Risk Insufficient infrastructure. Nature of Control Automated / Manual

1. Check whether the applications (Software) in use are appropriate in terms of present technology.

11.TA.5.2 CEMG - IT Infrastructure Control Objective Cost Benefit Analysis Nature of Work Step Verification / Analysis Risk Higher cost. Nature of Control Manual

1. Check whether cost benefit analysis is performed before proposing new applications or technologies.

Audit Checklist

364

11.TA.6 CEMG - Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material / service









delays.

11.TA.7 CEMG - Monitoring of Operator function and financial probity Control Objective To verify whether the operator functions in a good operational and financial

probity. Nature of Work Step Verification Risk Inadequate financial and operation probity may lead to financial


1. Review : a. Recoverability of debts. b. Movement of inventory. c. Working capital management. d. Funds management. e. Procedure for cash calls. f. Analysis of cash calls as against approved work program. g. Escrow account maintained for the work program (if applicable). h. Deployment of cash call received. i. Application of time writing rates. j. Time writing and allocation policies. k. Time writing charges for Non-Joint venture activity. l. Time writing rates, including revisions thereof. m. Procedures for monthly accounts closure. n. Contracts and materials management. o. Procedure for arriving at the value of work done. p. Well cost reconciliation. q. Payment of duties, taxes, cess and other statutory payments on time. r. Engineering, Procurement, Installation and Commissioning reconciliation. s. Structuring of contracts. t. Application of contractual rates in invoice payments. u. Commitment reporting.

Audit Checklist

365

v. Replies to DGH and Government audits. w. Accounting structure.

2. Prepare a detailed process flow on each of the above and examine the compliance to the SOP, if in existence.

3. In case control weakness observed, report the issues with its perceived impact on the cost recovery and its financial / operational impact.

4. Verify whether the management has an established internal control structure and a procedure for financial reporting.

5. Document and report in cases of anomalies observed.

Audit Checklist

366

12. Field Communication – Technical Audit

Scope Audit Areas

1 Planning, preparation and maintenance

2 Field communication

3 Technical up gradation


5 Issuance of spare items

6 PR tracking


8 Manpower planning

Audit Checklist

367

12.TA.1.1 Field Communication Control Objective Effective implementation of activities (Central server) Nature of Work Step Verification Risk Communication/ Equipment Failure and malfunctioning. Nature of Control Manual

1. To verify availability & effectiveness of communications devices. 2. To ensure that communication failure due to inadequate power backup does not occur. 3. To check the availability of substitute sources (Gen sets) in case of breakdown of electrical

power supply in camp and field. 4. To ensure situation of equipment failure and/or malfunctioning is immediately handled. 5. To check if redundancy is inbuilt in switching system to mitigate failure effect. 6. To ensure that there is timely restoration of services and/ or presence of monitoring at night.

12.TA.1.2 Field Communication Control Objective Effective implementation of activities (Radio communication network) Nature of Work Step Verification Risk Ineffective communication. Nature of Control Manual / Automated

1. To check that in order to avert the situation of equipment failure spares are maintained, there is repair of faulty equipment in lab, maintenance service contracts are in place and installation of proper lightning arrestors and earthings has been done. Use T-codes MMBE, IW39, IW29.

2. To check that new Wireless Planning & Co-ordination (WPC) licenses are obtained as and when required/there is timely renewal of wireless licenses.

3. To check that communication is provided through other service providers to far-flung installations where there is non feasibility of radio communication.

12.TA.1.3 Field Communication Control Objective Equipment security Nature of Work Step Verification Risk Theft and sabotage of equipment. Nature of Control Manual

1. To ensure there is proactive security available to restrict theft and sabotage of equipment. 2. To check if measures have been adopted to avert the risk of fire in installation.

12.TA.1.4 Field Communication Control Objective Data security Nature of Work Step Verification Risk Data loss Nature of Control Manual

1. To check that back-up of data and information has been taken periodically as per defined policy and log book has been maintained.

12.TA.1.5 Field Communication Control Objective Availability of substitutes Nature of Work Step Verification Risk No back-up in case of OFC failure. Nature of Control Manual

1. To check if there is availability of remote field exchanges and Voice over Internet Protocol (VoIP) devices work in Local mode in case of radio link failure with central server.

Audit Checklist

368

2. To check if there is a back-up available in case of failure of OFC media. 3. To see if alternative communication modes or substitute communication is available in case of

communication failure due to failure of transmission lines.

12.TA.2 Technical Up-gradation Control Objective Absorption of new technologies Nature of Work Step Analysis / Verification Risk Operational inefficiency. Nature of Control Manual

1. To check whether there is appropriate application in terms of present technology. 2. To ensure there are no operational inefficiencies on account of technology obsolescence. 3. To check if there is late adoption of technology. 4. To check the pay back period for adopted new technology. 5. To ensure there are special projects undertaken for the advanced studies to support proposed

locations and identify new technologies. 6. To check if there is a periodic review of progress. 7. To ensure that equipment used are as per international standards and best practices. 8. To review and to obtain present technology and new technology on the basis of cost -benefit

analysis and also its overall success ratio.

12.TA.3 Equipment maintenance & management Control Objective Efficient utilization and increased life of the instruments/ equipment/ ground

electronics Nature of Work Step Analysis / Verification Risk Underutilization of instruments, equipment and ground electronics. Nature of Control Manual / Automated

1. Use T-Code IE03 to view the equipment details and check whether the utilization of equipment is reviewed regularly.

2. To check whether there is proper maintenance of instruments/ ground electronics. 3. To check whether there is proper AMC in place. Use T-codes ME23N, IE03. 4. Check whether there is a maintenance schedule (preventive/regular) for equipment and its




12.TA.4 Issuance of spare items Control Objective Avoiding stock out situation, adequate approvals for issuance, inventory

controls Nature of Work Step Analysis / Verification Risk No process monitoring over obsolete/ slow/ non- moving spares. Nature of Control Manual / Automated


2. Check about availability of proper storage system.

Audit Checklist

369







12.TA.5 Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material / service









delays.

Audit Checklist

370

13. Field Engineering – Technical Audit

Scope

Audit Areas



3 PR tracking


5 Manpower planning

6 SOP Compliance






12 Safety


14 Security


16 Tools, spares and other Expenses

17 HSE Compliances

18 Projects

Audit Checklist

371

13.TA.1 P&A - Creation of Service Entry Sheet (SES) Control Objective Exploiting the best option available Nature of Work Step Analysis / Verification Risk 1. Delays in payments.









13.TA.2 P&A - Manpower Planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Analysis / Verification Risk 1. Over/Under-utilization of manpower.




13.TA.3 CWS, IC Field & Water Injection (ICE-F & WI), Project and Tank Farms, Water

Supply and Injection – SOP Compliance Control Objective Compliance of SOP Nature of Work Step Verification Risk Non compliance to SOP. Nature of Control Manual

1. Check that company has a well defined SOP for servicing. 2. To check that all process are being followed as per SOP. 3. To check any deviation from SOP and document the reason given for same. Analyze its

reasonability and quote. 4. Check that ISO standards have been met with.

Audit Checklist

372


Supply and Injection – Services - Operations Control Objective Effective distribution of work and timely completion Nature of Work Step Verification / Analysis Risk Inefficiency in work completion and delays. Nature of Control Manual / Automated

1. To check whether service is availability 24*7 to ensure timely service. 2. Check for delay in providing maintenance services resulting in loss of operational efficiency. 3. To check that manpower are allocated as per plan only so as to avoid any delay. 4. Check that adequate maintenance is carried out on timely basis to avoid power breakdown. Use

T-code IP24 and enter machine / job number to see the maintenance schedule. 5. Check that energy audit is conducted on time. 6. Check if controls are in place to ensure efficient utilization of power. 7. Check that recommendations of energy audits are complied with. 8. Check that statutory compliance checklist is analyzed and updated regularlyand quote.


Supply and Injection – Preventive maintenance Control Objective Effective distribution of work and timely completion Nature of Work Step Analysis / Verification Risk Inefficiency in work completion and delays. Nature of Control Automated/Manual

1. To check whether preventive maintenance plan is prepared. Use T-code IP24 and enter machine / job number to see the maintenance schedule.

2. To check if the preventive maintenance plan is followed in all cases. UseT-code IW23 and IW39 to see maintenance details.

3. To check the reasons and approvals for deviations are documented. 4. To check if the equipment's/ machines not covered as per plan are re-scheduled for maintenance

using IP24. 5. To check if the past breakdowns and machine conditions are considered while preparing the

maintenance plan using IP24. 6. Check whether monitoring is done for compliance to OEM guidelines for operating equipment.

Use T-Code IE03 to view the equipment details.


Supply and Injection – Breakdown maintenance Control Objective Effective distribution of work and timely completion Nature of Work Step Analysis / Verification Risk Inefficiency in work completion and delays. Nature of Control Automated/Manual

1. To check whether service is availability 24*7 to ensure timely service of any breakdown in the plant.

2. Check for delay in providing maintenance services resulting in loss of operational efficiency. 3. To check that manpower are allocated as per plan only so as to avoid any delay. 4. Check that adequate maintenance is carried out on timely basis to avoid power breakdown.

Use T-code IP24 and enter machine / job number to see the maintenance schedule. 5. Check that statutory compliance checklist is analyzed and updated regularly. 6. Check downtime and breakdown due to the maintenance issues. Use T-code - IK07, IK17,

S_ALR_87013421.

Audit Checklist

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7. To check that necessary equipment's are always available in stores for unplanned malfunctioning of machines.

8. To check for any delays in maintenance due to non-availability of critical instruments and spares.


Supply and Injection – Cost control analysis Control Objective Minimum cost and maximum productivity Nature of Work Step Analysis / Verification Risk 1. Cost overruns.

2. Inadequate productivity. Nature of Control Automated/Manual

1. To check the budget is allocated and utilized in effective manner. The relevant T-code in SAP- S_ALR_87013559.

2. To check the cost incurred for maintenance and compare the same with budget. The relevant T-code in SAP- S_ALR_87013557.

3. To check if there are repetitive accidents for employees working in the department and corrective actions taken by department to minimize such cases.

4. To check extra expense incurred due to obsolete equipment's by analyzing the equipment-wise maintenance cost. The relevant T-code in SAP- S_ALR_87013557.


Supply and Injection – New project and achievements Control Objective Timely completion of task Nature of Work Step Verification Risk 1. Untimely completion of task.

2. Penalties. Nature of Control Manual

1. To check annual report for the new assignments undertaken and completed during the year and compare the same with their expected date of completion.

2. To check the financial impact of delay in completion of task.


Supply and Injection – Safety Control Objective Availability of protective devices, strict adherence to safety measures Nature of Work Step Verification Risk Accident prone Nature of Control Manual

1. Check the maintenance service schedule of lines. 2. Check whether safety devices are kept for maintenance people and no one is allowed entry

without them. 3. Check whether safety guidelines are defined for maintenance function and the same are

followed. 4. Check permit is issued and approved by designated authority before performing critical

maintenance activity.

Audit Checklist

374


Supply and Injection – Training to workers Control Objective Providing on site and off site training Nature of Work Step Verification Risk 1. Untrained employees.

2. Employee dissatisfaction. Nature of Control Manual

1. To check if the training is scheduled for all employees based on need identification. 2. To check steps taken to update workers with new machinery and technology. 3. To check if all mandatory and statutory trainings are provided to all workers. 4. To check if performance is analyzed and training needs are identified on the basis of same.


Supply and Injection – Security Control Objective To minimize risk of thefts and prevent financial losses Nature of Work Step Verification Risk 1. Risk of thefts.

2. Financial Risk. Nature of Control Manual

1. To check that management has identified critical areas in terms of thefts. 2. To check the management has a plan of action to stop any theft. 3. To check that CCTV's are in place to track any such case and is monitored by a security person. 4. To check any major theft reported during the audit period.


Supply and Injection – Statutory Compliances Control Objective To ensure compliance to various statutory requirements Nature of Work Step Verification Risk Non-compliance to statutory framework. Nature of Control Manual

1. Check that a checklist is maintained for all statutory compliances along with the due dates of complying the same.

2. Check that license related to power has been obtained and updated regularly. 3. Check that statutory compliance checklist is analyzed and updated regularly.4. Check whether all

the statutory compliances are ensured by the department.


Supply and Injection – Tools, spares and other Expenses Control Objective To ensure adequate controls over expenses Nature of Work Step Verification / Manual Risk Excess financial cost. Nature of Control Manual / Automated

1. To check if expenses are incurred within the approved budget. The relevant T-code in SAP- S_ALR_87013557, FBL3N.

2. To check if all indenting is approved as per DOP. The relevant T-code in SAP- ME53N, ME5A. 3. To check if all the material issues are duly approved and recorded. The relevant T-code in SAP-

MMBE, MB52, MB5B. 4. To check all procurement is carried out as per defined company policy. 5. To check if amount spent is adequately utilized for the purpose.

Audit Checklist

375


Supply and Injection – HSE Compliances Control Objective Compliance with HSE laws Nature of Work Step Verification Risk Non-compliance to HSE laws. Nature of Control Manual

1. To check that all HSE norms are complied with. 2. To check that health of workers is not compromised on any count. 3. To check that adequate safety measures are available within the premise and workers are asked

to adhere to the same.


Supply and Injection – Projects Control Objective To avoid any time and cost overrun in the projects Nature of Work Step Verification Risk Time and cost overruns. Nature of Control Manual

1. Check if the adequate planning is done for timely completion of the project within allocated budget. The relevant T-code in SAP- KSBL to see the budget.

2. Check if the periodic monitoring is done to avoid any time and cost overrun. The relevant T-code in SAP- CJ20N.

3. Check if proper quality checks are performed for all input material, equipment and jobs carried out.

4. Check if the project commission and installation tests are performed and documented. The relevant T-code in SAP- CV03N to see the documents.

Audit Checklist

376

15. Geology & Reservoir – Technical Audit Scope

Audit Areas


2 Exploration & Development

3 Operations

4 Reservoir

5 Reserve appraisal

6 PR tracking


8 Manpower planning

Audit Checklist

377

15.TA.1.2 Exploration and Development

Control Objectives Minimizing or avoiding Risk of drilling dry hole


Risk Drilling dry hole.


1. To check whether all the steps as planned are followed while analyzing the data for generating

a exploratory/ development location.

2. To check whether the drilling is done for priority locations to minimize dry wells.

3. To check whether there is a process for revalidation of results by peer groups (within the

Company) in case of exploratory/ development locations.

15.TA.1.3 Exploration and Development Control Objectives Techno-economic viability


Risk Incurring high cost.


1. To check whether techno-economic analysis is conducted before proposing a location.

15.TA.1.4 Exploration and Development Control Objectives Compliance to DOP for release of a location




1. To check whether necessary approvals are obtained as per DOP for release of a location for

drilling.

15.TA.1.5 Exploration and Development Control Objectives Compliance to SOP


Risk Non-compliance to SOP.


1. To check whether the procedures mentioned in Standard Operating Procedures (SOP) are

complied with while carrying out exploration activities.


Control Objectives Identification of activities chart and effective monitoring

thereof


Risk Non-compliance to activity schedule.


1. To check whether an activity schedule is prepared, and its compliance is monitored. Any

diversification from the plan and delays, should be reported to the management with reasons.

Use T-code CN47N.

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378

2. To ensure the achievement of the MOU parameter(s).

15.TA.1.7 Exploration and Development Control Objectives Tracking of annual targets


Risk No check on planned v/s actual.


1. To check whether actual exploration meets planned targets on annual basis.

2. To check whether expected returns from exploration blocks are optimized/ actualized.

15.TA.1.8 Exploration and Development Control Objectives Timeliness


Risk Non adherence to timeliness.


1. To check that there is adherence to annual drilling program especially with respect to

timeliness. Use SAP T-code CNE5, S_ALR_87015124.

15.TA.1.9 Exploration and Development Control Objectives Adoption of suitable applications so as to get desired results

from analysis


Risk Use of outdated technology.


1. To check whether the applications (Software) in use are appropriate in terms of present

technology.


Control Objectives Techno-economic analysis




1. To check whether cost benefit analysis is performed before proposing new applications or

technologies. Use SAP T-code KSBL and enter cost center to check planning over view.

2. To check whether extensive quality analysis is done for the vendors hired for various purposes

(conducting surveys, recording of special logs etc.).

15.TA.2.1 Operations Control Objectives Land acquisition


Risk Delay in land acquisition.


Audit Checklist

379

1. To check whether Land Acquisition Form LAF - 1 and LAF-3 are timely issued by the department.

2. To check whether regular follow-ups are done for timely receipt of LAF-2.

3. To check whether timely approval is obtained for selection of an alternative location as per DOP

in case the desired location cannot be stacked.

15.TA.2.2 Operations Control Objectives Planning , budgeting and costs


Risk Inadequate planning and budgeting.


1. To check whether there is adequate planning process (e.g. no delays in regulatory approval

process).

2. To check whether there is adequate tracking of costs of exploration vs. targets or the standards

defined in SOP (e.g. budget vs. actual). Use SAP T-code S_ALR_87013532.

3. To check whether there is delay in work completion or cost overruns due to planning process.

15.TA.2.3 Operations Control Objectives Data analysis


Risk 1. Drilling dry hole.

2. Insufficient data.


1. To check there is integration of all surface and subsurface geoscientific data and lab analyses,

including flush sample analysis.

2. To ensure that the risk of dry wells due to insufficient data and neighboring well evidence is

averted.

15.TA.2.4 Operations

Control Objectives Minimizing or avoiding drilling risk


Risk Risk of drilling in a stacked location.


1. To check whether there is a validation process to check if the exact location requested has been

stacked.

15.TA.2.5 Operations Control Objectives Timely abandonment and restoration of well


Risk Delay in abandonment /restoration of abandoned well sites.


1. To ensure that there is timely abandonment of dry/non-producing well have been done.

2. To ensure timely restoration of abandoned well sites.

15.TA.2.6 Operations Control Objectives Identification of activity chart and effective monitoring

thereof

Audit Checklist

380


Risk 1. Delays in activities.

2. Non-monitoring of activities.


1. To check that timely and complete plan of drilling/testing program is made and ensure that

approval is taken as per DOP.

15.TA.2.7 Operations Control Objectives Tracking of actual vis a vis planned drilling program


Risk No tracking of drilling activities as per planned vs. actual.


1. To check whether the drilling plan is monitored regularly and modified, if required.


Control Objectives Compliance to SOP




1. To check whether the procedures mentioned in SOP are complied with while preparing the

drilling program.

15.TA.2.9 Operations Control Objectives Identifying areas of improvements by performing root cause

analysis


Risk Operation failures.


1. To check if root cause analysis is done for operational problems/ failures and steps taken for

improvement.

15.TA.2.10 Operations Control Objectives Adequate approvals




1. To check whether approvals as required by DOP are obtained.


Control Objectives Sick wells


Risk Delay in identification of upcoming work over.


Audit Checklist

381

1. To check whether the sick wells are diagnosed for work over.

2. To check whether there is timely identification of upcoming work over candidates.

3. To check whether there is effective knowledge sharing so that well logs are properly

interpreted.

15.TA.2.12 Operations Control Objectives Maintaining a well completion history report with adequate

supporting data


Risk Delay in submitting completion report.


1. To ensure that the well completion report is submitted timely along with root cause analysis in

case of failure, by the Geologist responsible for the well and distributed as per policy.

2. To check whether there is any data loss of well history due to inadequate data management

(e.g. Data Security, Disaster Planning etc.).

15.TA.3.1 Reservoir

Control Objectives Data Acquisition


Risk Delay in data acquisition.


1. To ensure timeliness of data acquisition process i.e. data request must be sent in advance and

follow-up should be done regularly.

15.TA.3.2 Reservoir

Control Objectives Accuracy of data to be used for analysis


Risk Inaccurate data.


1. To check whether there is a process to analyze the quality and accuracy of the data received by

the Reservoir department.

15.TA.3.3 Reservoir

Control Objectives Performance Analysis


Risk Low performance.


1. To check whether data acquired is fully used for carrying out Performance analysis of a

well/field for optimum results.

15.TA.3.4 Reservoir

Control Objectives Optimum utilization of applications used for data analysis and

interpretation


Risk Underutilization Of applications.

Audit Checklist

382


1. To check the optimum utilization of applications used for data analysis and interpretation.

2. To check whether there is integration of all surface and subsurface geoscientific data and lab

analyses with pressure and production data.

3. To check whether mapping of geologically complex data is done in detail after adequate quality

control of data.

15.TA.3.5 Reservoir

Control Objectives Increasing efficiency of applications


Risk 1. Low maintenance.

2. Non-compliance to maintenance schedule.


1. To check whether there is a maintenance schedule for the applications used for data analysis

and ensure its compliance. Use SAP T-code IP24.

15.TA.3.6 Reservoir

Control Objectives Data storage


Risk Loss of data.


1. To check there is proper archiving so that there is no loss of data in case of software/hardware

failure.

15.TA.3.7Reservoir

Control Objectives Techno-economic analysis




1. To verify the process followed for conducting cost benefit analysis to optimize production.

15.TA.3.8 Reservoir

Control Objectives Increasing efficiency of carrying out various activities


Risk Low efficiency.


1. To check whether there is a process for lead time analysis and monitoring of various activities

carried out by Reservoir Section.

2. To check the choice of proper risk margins for selection of reservoir parameters.

15.TA.3.9 Reservoir

Control Objectives Improvement measures


Risk Process failure.


Audit Checklist

383

1. To ensure whether analysis is done to identify the short falls in the process and improvement

measures taken.

15.TA.3.10 Reservoir

Control Objectives Compliance to SOP




1. To check whether the procedures mentioned in SOP are complied with while performing

Reservoir activities.

15.TA.3.11 Reservoir

Control Objectives Adequate approvals




1. To check whether approvals as required by DOP are obtained.

15.TA.4.1 Reserve appraisal Control Objectives Compliance to SPE-PRMS


Risk Non-compliance to SPE-PRMS.


1. Check whether estimation, categorization / classification of oil, condensate & gas reserves are

in compliance with the Society of Petroleum Engineers (SPE) -Petroleum Resources

Management System (PRMS) reserve definition and guidelines. Refer Reserve Audit standards.

15.TA.4.2 Reserve appraisal Control Objectives Compliance to DOP




1. To check whether estimation, categorization/ classification of oil, condensate & gas reserves are

reviewed and approved as per DOP.

15.TA.4.3 Reserve appraisal Control Objectives Adequate documentation


Risk Inadequate documentation.


1. To check whether necessary documentation is maintained as required by SPE-PRMS guidelines.

Use SAP T-code CV03N.

15.TA.4.4 Reserve appraisal Control Objectives Planning

Audit Checklist

384


Risk Delays in monitoring


1. To ensure timely monitoring of the reserves. Use SAP T-code CJ31, CJ33, S_ALR_87013558.

2. To ensure the estimation of reserves is accurate. Use SAP T-code CJ31, CJ33, S_ALR_87013558.

15.TA.4.5 Reserve appraisal Control Objectives Technology


Risk Use of outdated technology.


1. To ensure that the technology used is new and check the reasons for reliance on old

technology.

15.TA.4.6 Reserve appraisal Control Objectives Timely submission of reports


Risk Delay in submission of reports.


1. To check whether monthly/quarterly/annual reports are submitted as per the requirement.

15.TA.5 Creation of Service Entry Sheet (SES)

Control Objectives Timely and accurate receipt of material


Risk 1. Delays in payments.

2. Incorrect payments.


1. To check whether status of work completion in manual records is updated as per contract

terms. Use T-code ME2S/MSRV1.

2. To check whether confirmation or acknowledgement of work completed is taken from

contractor on manual records.

3. To check whether the manual records are verified and approved by concerned authority.

4. Use T-Code ML84 to view the list of SES's and ML81N to view the details of specific SES. Check

whether the SES for the services received is timely prepared.

5. Check whether proper technical survey/inspection is carried out for quality assurance before

creation of SES.

6. Check whether the inspection carried out is approved as per DOP.

7. Check whether there is a process of monitoring the date of completion as mentioned in the

contract w.r.t the actual date of completion/creation of SES.

8. Check whether reasoning analysis is done for the delays and steps are taken to avoid similar

delays.

Audit Checklist

385

15.TA.6 Manpower planning

Control Objectives To ensure manpower is adequate for all the departmental

activities


Risk 1. Over/Under utilization of manpower

2. Operational delays caused due to low manpower


1. Check whether there is adequate manpower to carry out all the operations of the department -

administrative and technical.

2. Ensure manpower requisition forms are raised timely and approved as per DOP.

3. Check whether there is a follow up process in place to ensure timely conversion of MPR.

Audit Checklist

386

16. Geophysics – Technical Audit

Scope

Audit Areas


2 Interpretation

3 Planning and execution of seismic and related data acquisition


5 Instruments management and maintenance

6 Buy vis a vis hiring of instruments / equipment

7 Seismic data processing and archival of data

8 Technical upgradation

9 PR tracking



Audit Checklist

387

16.TA.1 Interpretation Control Objective Accuracy of interpretation Nature of Work Step Verification Risk Incorrect interpretation.

Nature of Control Manual 1. To ensure that there is correct interpretation of data. 2. To check that there is correct processing of data based on correct interpretation. 3. To ensure that there is quality review process of validating the interpretation workflow / cycle

followed. 4. To check that there is timely study for interpretations. 5. To verify that the receipt of processed seismic data & well data along with other related

information. 6. To verify that there is a quality control check for authenticity of the data. 7. To verify that there is no corruption of seismic/ well/ petro physical data set. 8. To ensure adequate storage capacity of hardware. 9. To verify that there is proper selection of workflow and choice of optimum parameters. 10. To verify that people involved have knowledge of entire exploration cycle. 11. To verify that there is a timeline decided for each study. 12. To cross check with previous interpretation if available, available well data set, local geology

reports.

16.TA.2.1 Planning and execution of seismic and related data acquisition Control Objective Accuracy in planning and adequate controls in execution of seismic and

related data acquisition, database management, availability of supply of explosives etc., logistics, and substitute sources, timeliness of activities

Nature of Work Step Verification / Analysis Risk Delay in execution. Nature of Control Automated/ Manual

1. To ensure there is adequate planning so that regular operation of geophysics activities is not affected.

2. To check the acquisition process of seismic data for both 2D and 3D operational areas.

3. To check that there is a proper process for recording of data and submission of recorded data to processing section.

4. To check that there is proper database for consumption and availability of explosives and detonators. SAP T-codes reference for reports / verification MMBE, MB51, MMBE.

5. To check whether there is monitoring of receiving, consumption, stock of explosives on daily basis. SAP T-codes reference for reports / verification MMBE, MB51, MMBE.

6. To check the availability of substitute sources in case of unexpected breakdown of survey and recording equipment, tools, ground electronics etc.

7. To check the availability of substitute sources(Gen sets) in case of breakdown of electrical power supply in camp and field.

8. To ensure proper logistics in the area i.e. customized design for recording and drilling activities put in practice for logistically difficult areas.

9. To ensure proper logistics between the storage location and area of blast. 10. To ensure that there is timely procurement & uninterrupted supply of explosives and detonators.

SAP T-codes reference for reports / verification ME5A, MB5B, ME5A. 11. To ensure timely awarding of seismic contracts/ hiring of vehicles. SAP T-codes reference for

reports / verification ME53N, ME23N, ME5A and ME2N.

Audit Checklist

388

12. To ensure that seismic survey contractors comply with the terms and conditions of the contract. 13. To ensure there is no situation of non-performance by the contractor/ in-house team to acquire

quality seismic data. 14. To check there is liasoning with forest officials, district authorities, police station, tea estates,

and village heads etc. 15. To ensure that sensors are properly laid, as otherwise if even one of the sensor is uprooted the

measurement cannot be taken. 16. To check that there is no delay in execution due to ineffective liasoning and inadequate follow-

up with district authorities, police station, tea estates, and village heads etc. to get approval for survey before proceeding for it.

16.TA.2.2 Planning and execution of seismic and related data acquisition Control Objective Statutory Compliances


Risk Non-compliance to statutory requirements. Nature of Control Manual

1. To verify whether there is timely submission of annual return (online) report on explosives and detonators consumed.

2. To ensure that no explosives are blasted after sunset. Ensure that any unused material is stored in designated space / bunker as defined in the SOP.

16.TA.3 Environment, health and safety compliance Control Objective Safeguarding interest of Company / employees / public and environment


Risk Non-compliance to EH&S regulations. Nature of Control Manual

1. To check whether there is a compliance framework related to statutory requirement for EH&S. 2. To check whether EH&S compliance framework is monitored and reviewed on regular basis. 3. To check that there is safe handling of explosives under the supervision of licensed shot fired

and SOP should be followed for geophysical activities. 4. To check whether compliance of Safety Operating Procedures is ensured and documented. 5. To check whether required documents/report/returns are filed on monthly/quarterly/annually

basis to Govt./State Govt./Authorities/Atomic Energy Regulatory Board (AERB). 6. To check that process exists to mitigate risks arising from explosive handling, shot hole drilling

for safe loading and blasting operations, equipment malfunctioning and data quality. 7. To check that there is deployment of security on time in case of any emergency. 8. To ensure that short firer has a valid license for handling and operation of explosives. 9. To check that forest area permission is taken for seismic survey.

16.TA.4 Instruments management and maintenance Control Objective Efficient utilization and increased life of the instruments/ equipment/ ground

electronics Nature of Work Step Verification / Analysis Risk 1.Non-compliance to OEM guidelines.

2.Inefficient utilization of equipment. Nature of Control Manual / Automated

1. To check whether cost benefit analysis is done for buying vis a vis hiring of equipment. 2. To check there is proper maintenance of instruments/ ground electronics. 3. To check there is proper AMC in place. Use T-code ME2S and ME33K. 4. To verify there is proper AMC For hardware and software in place.

Audit Checklist

389

5. To ensure proper maintenance of hardware or software used for processing of seismic data. 6. To check whether there is a maintenance schedule (preventive/regular) for equipment/

instrument and its compliance. 7. To check whether monitoring over turn around time as per schedule and actual time taken for

maintenance of equipment is done. 8. To check whether the equipment/ instruments are calibrated regularly. 9. To check whether monitoring is done for compliance to OEM guidelines for operating

equipment.

16.TA.5 Buy vis a vis hiring of instruments / equipment Control Objective Exploiting the best option available Nature of Work Step Verification Risk Increase in cost. Nature of Control Manual

1. To check whether cost benefit analysis is done for buying vis a vis hiring of equipment.

16.TA.6 Seismic data processing and archival of data Control Objective Accuracy in data processing and archival Nature of Work Step Verification / Analysis Risk Delay and non-accuracy in data processing and archival process Nature of Control Manual

1. To verify there is no delay in seismic data processing due to ineffective scheduling. 2. To ensure the presence of base maps/topographical maps for field surveys activities or for

processing purpose. 3. To ensure proper receipt of raw field data set and other related information. 4. To check the maintenance of history of raw field data set and processed data. 5. To ensure the archival of raw field data set and processed outputs in relevant media for safe

storage. 6. To ensure proper loading, geometry (coordinate) assignment and navigation QC of field data. 7. To ensure that selection of processing parameters/ processing work flow of seismic data is as

per defined procedures. 8. To ensure there is generation of report and delivery of processed output to concerned section. 9. To ensure archival of raw dataset in relevant media for safe storage. 10. To verify that there exists a process for proper resource management. 11. To ensure that redundancy in input data sets are predicted timely. 12. To ensure there is a process of monitoring progress and periodic review of projects.

16.TA.7 Technical upgradation Control Objective Absorption of new technologies Nature of Work Step Verification Risk Operational inefficiency. Nature of Control Manual

1. To check whether there is appropriate application in terms of present technology. 2. To check if there is late adoption of technology. 3. To check the pay back period for adopted new technology. 4. To ensure there are special projects undertaken for the advanced studies to support proposed

locations and identify new technologies. 5. To ensure that equipment used are as per international standards and best practices. 6. To review and to obtain present technology and new technology on the basis of cost -benefit

analysis and also its overall success ratio.

Audit Checklist

390














Audit Checklist

391

19. Instrumentation – Technical Audit

Scope Audit Areas


2 Operations

3 Maintenance

4 Projects


6 PR Tracking

7 Manpower Planning

Audit Checklist

392

19.TA.1 Operation Control Objective 1. Automation & Control for all Process Equipment & Installations.

2. Effective implementation of activities Nature of Work Step Verification Risk Ineffective implementation of activities. Nature of Control Manual

1. To check that repairing and calibration of field instruments is done in Lab wherein there is receipt of material from fields, necessary repair is carried out and calibration of the equipment is done against a laboratory standard.

2. To check the generation of calibration report. 3. To check that the activities are recorded. 4. To check if training is provided to the available manpower to develop skill. 5. To check if training is provided on safety awareness. 6. To check that there is proper handling of equipment and there is sufficient availability of spares. 7. To check that there is timely deployment and adequate team mobilization. 8. To check that there is effective utilization of available infrastructure. 9. To check that before calibration all the fittings attached to the drilling instruments/ main

equipment should also be able to withstand same high pressure. 10. To check that for calibrations at site, instrument is Intrinsically Safe (IS) approved by CIMFR. 11. To check that in all new OCS installations PMCS (Process monitoring control system) is being

planned. 12. To verify that before commissioning any PLC/DCS, a detailed analysis is done to identify key risks. 13. To check that there is no delay in utilization due to non availability of required commissioning

site.

19.TA.2 Maintenance Control Objective Timely closure of maintenance requests to avoid operational delays

Efficient utilization and increased life of the equipment Effective implementation of activities

Nature of Work Step Verification Risk Inefficient utilization of equipment. Nature of Control Manual

1. To check whether PM schedule has been displayed for every equipment/vehicle. The T-code reference for reports/verification is IP10 to display the scheduled maintenance plan and use IP24 to display the plan defined based on overview.

2. To check that there is display of the PM checklist in the workplace near vehicle. 3. To check whether there is a maintenance schedule for equipment and its compliance. The T-code

reference for reports/verification is IP10, IP24. 4. To check whether monitoring over turn around time as per schedule and actual time taken for

maintenance of equipment is done. 5. To check whether the equipment are calibrated regularly. The T-code reference for

reports/verification is IP10, IP24. 6. To verify that equipment are ready for reinstallation in fields. 7. To check whether the services equipment/vehicle is tested under appropriate conditions and in

presence/by experience individual. 8. To check whether monitoring is done for compliance to OEM guidelines for operating

equipment. To check for timely receipt of notifications. 9. To check for timely deployment of manpower. The T-code reference for reports/verification is

IW23or IW29 to display the PM notifications. Ensure that a proper manpower plan has been

Audit Checklist

393

drafted to deploy the resources timely. 10. To check whether there are frequent breakdowns due to inadequate maintenance. The T-code

reference for reports/verification is IW23,IW29,IW39 to check for frequent breakdowns. Analyze the reasons for the same and ensure that the same did not occur due to non-maintenance of equipment.




insurance cover, if required. 15. To check if adequate maintenance measures are adopted as usage of gas instead of air affects

the life of instruments. 16. To ensure proper utilization of the assets. 17. To check that AMC of relevant equipment is done on time. 18. To ensure utmost care of customer satisfaction and attending grievances effectively. 19. To check if there is liasoning with contractors to procure spares on urgent basis. 20. To ensure timely services to other departments like Hospital, LPG, Chemical, Fire, Safety etc. 21. To check there is safety from hazards due to working conditions in the lab.

19.TA.3 Projects Control Objective Effective implementation of activities Nature of Work Step Verification Risk Delays in project and ineffective monitoring. Nature of Control Manual

1. Check whether project planning has been done and adhered to. 2. Check before start of project feasibility study has been done to evaluate all available

technologies. 3. Check delays in projects on sample basis and verify root cause analysis is done for deviations

and whether appropriate approvals have been obtained.

19.TA.4 Environment, Health & Safety and Statutory Compliance Control Objective Safeguarding interest of Company / employees / public / creatures Nature of Work Step Verification Risk Interest of the company is threatened. Nature of Control Manual

1. To check whether there is a compliance framework related to statutory requirement for EH&S. 2. To check whether EH&S compliance framework is monitored and reviewed on regular basis. 3. To check whether compliance of Safety Operating Procedures (SOP) is ensured and documented. 4. To check whether required documents/report/returns are filed on monthly/quarterly/annually

basis to Govt. /State Govt./Authorities/Atomic Energy Regulatory Board (AERB). 5. Verify procedure around approval & review of following by Operating & management committee:

a. Minimum work program. b. Annual Budget. c. Revision of Budget. d. Authorization for Financial Expenditure / Authorized Expenditure Request.

Audit Checklist

394

e. Progress of the work. f. Cash call. g. Costing basis. h. Preparation & Circulation of MIS.

19.TA.5 Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material / service









delays.

19.TA.6 PR tracking Control Objective Timely raising of PR and monitoring






Audit Checklist

395

20. Land – Technical Audit

Scope Audit Areas

1 Planning and assessment

2 Acquisition of land through Bipartite Negotiation / Settlement

3 Acquisition of land through Land Acquisition Act, 1894

4 Acquisition of land under Provision of Forest (Conservation) Act, 1980

5 Land records

6 Restoration of land

7 PR tracking


9 Manpower planning

Audit Checklist

396

20.TA.1.1 Planning and assessment Control Objective Appropriate decision making in terms of acquiring the land Nature of Work Step Verification Risk Non-compliance. Nature of Control Manual

1. Check whether land acquisition forms (LAF) are issued by the respective departments: a. LAF 1 - issued by Geology & Reservoir (G&R). b. LAF 2 - issued by Civil and Land. c. LAF 3 - issued by G&R.

20.TA.1.2 Planning and assessment Control Objective Completeness of the details required to be filled up in forms Nature of Work Step Verification Risk Incomplete Details. Nature of Control Manual

1. Check whether LAFs issued by the respective departments are complete as per the defined format.

20.TA.1.3 Planning and assessment Control Objective Compliance to DOP Nature of Work Step Verification Risk Non-compliance to DOP. Nature of Control Manual

1. Check whether LAFs are approved by competent authority as per DOP.

20.TA.1.4 Planning and assessment Control Objective Alignment between Land Map and survey, pillaring, demarcation, plot

measurement conducted by Civil Department Nature of Work Step Verification Risk Non-compliance and delay. Nature of Control Manual

1. Check whether a Land Map is prepared and issued by Civil Engineering (Survey section) after issuance of LAF

2. Check whether detailed survey, pillaring, demarcations and individual plot measurement are conducted by the Civil Department as per the land map received.

20.TA.2 Restoration of land Control Objective Site restoration and timely transfer of custody Nature of Work Step Analysis / Verification Risk 1. Statutory Non-Compliance.

2. Excess payment. Nature of Control Automated / Manual

1. Check whether the land department conducts regular inspection of land restored by drilling department.

2. Check whether a policy exists for treatment of land after drilling of dry holes or the wells from which have been shut down. Ensure the compliance to the same.

Audit Checklist

397

23. LPG Plant - Technical Audit

Scope Audit Areas


2 Policy and procedures

3 LPG extraction

4 Identification and evacuation of defective cylinders

5 LPG filling and bottling

6 Dispatch of cylinders

7 PR tracking


9 Manpower planning


11 Training of employees




15 Handling safety issues

16 SOP Compliance



19 Safety


21 Security



24 HSE compliances

Audit Checklist

398

23.TA.1 LPG - Policy and procedures Control Objective Documentation of process, identifying deviations and mode of improvements Nature of Work Step Verification Risk 1. Non Compliance to SOP.

2. Non Compliance to ISO Standard. Nature of Control Manual

1. To check the SOP for LPG production is available and strictly followed.

2. To check if the operating guidelines are defined and followed for all operations involved in

production.

3. Check if system is in place to regularly review and update the documented process in line with

changing requirements.

4. Check if the ISO standard procedure is documented and followed for all operating activities.

23.TA.2 LPG - LPG extraction Control Objective Extraction of LPG with appropriate quality standards Nature of Work Step Verification Risk Non Standard quality of LPG. Nature of Control Manual/Automated

1. To check that procedure for removing impurities is strictly followed in line with defined

guidelines. Use T-Code QP08.

2. To check if the planned level of impurities are monitored for removal from the actual input. Use

T-Code QP08.

3. To check that system is in place to ensure correct compression ratio. Also ensure that the same

is maintained as per the defined requirements. Use T-Code QP08.

4. Check if system is in place to identify the gas leakages on timely basis so that corrective action is

taken.

5. Review the reported instances in the past to ensure timely action is taken by the department.

6. Check if root cause analysis is done for all the reported instances and action plan is decided to

avoid the same in future.

7. To check if the guidelines for maintenance of temperature in boiler are followed and monitored.

Use T-code IA07.

8. Check if the regular quality check is performed for both incoming gas and extracted LPG. Use T-

Code QDH2, QGC2.

9. Check if all quality deviations are adequately documented and approved by designated

authority. Use T-Code MCXB and MCXD.

Audit Checklist

399

23.TA.3 LPG - Identification and evacuation of defective cylinders Control Objective Identifying leaky cylinders, damaged cylinders and final disposal of Gas in

such identified cylinders Nature of Work Step Verification Risk Non identification of defective, damaged and leaking cylinder causing filling

and dispatch of gas in defective cylinders. Nature of Control Manual/Automated

1. To check whether defined procedure is followed for identification of defective cylinders at the

floor. Use T-Code MCXE, MCXC.

2. To check the number of return cases due to over filling causing leakage of Gas and verify

whether the adequate quality control procedures were followed for such cases. Use T-Code

VL06I.

3. To check the disposal plan for defective cylinders so that they do not get mixed with other

cylinders.

4. To check whether the gas is removed on timely basis from all defective cylinders.

23.TA.4 LPG - LPG filling and bottling Control Objective Ensuring filling of correct quantity Nature of Work Step Analysis/Verification Risk Incorrect quantity of LPG filling and LPG is not having any odor. Nature of Control Manual/Automated

1. Check that the process of cross checking the unloading advice with number of cylinders to

identify difference is followed.

2. To check that a person has been designated at gate for counting purpose, each time a truck

comes for unloading.

3. Check if the validity date and physical condition of cylinders is verified and cylinders with

deviations are rejected. Use T-Code MCXE, MCXG.

4. To check whether tare weight has been mentioned on each cylinder.

5. To check whether tare weight is measured and cylinders with deviations are rejected.

6. To check whether cut off point is fixed at 14.2 kg to limit extra Gas filling. Tolerance as per the

defined guidelines are allowed and no excess/ short filling is accepted.

7. Sample check the measurement of few filled cylinders to check accuracy of the process

followed.

8. Check if the tare weight is adequately checked and monitored for all cases of LPG dispatched

through tankers.

9. Check if adequate records are maintained for tare weight and gross weight for each dispatch.

Use T-Codes IK07, IK17, S_ALR_87013421.

10. Verify if the tare weight of the same vehicle has major differences in multiple visits.

11. Check if the billing information is tallied with the difference of gross weight and tare weight.

Use T-Code VF03.

12. Check if all the tests, as defined in the process, are carried out to identify leakage and other

quality issues. Use T-Code MCXG, QDH2.

13. Check if the tanker is moved inside after proper verification of tanker and statutory

documents.

14. Check if physical safety checking and weight verification of tankers are carried out by

competent authority randomly.

Audit Checklist

400

15. Check if in all cases ethyl mercaptan is mixed with LPG before filling of LPG. Use T-Code MCXB,

MCXD.

23.TA.5 LPG - Dispatch of cylinders Control Objective Number of cylinders dispatched, proper monitoring and checking of cylinder

weights and caps Nature of Work Step Verification Risk Improper monitoring while cylinder is dispatched. Nature of Control Manual/Automated

1. To check the number of cylinders dispatched against the order and pack list available for

dispatch. Use T-Codes VL03N and enter the sample delivery number.

2. To check if adequate verification and counting is performed before loading of cylinders for

dispatch.

3. Check if the delivery slips are duly authorized and verified by security.

4. Check if all the cylinders being dispatched are properly capped.

5. Check if proper calibration and maintenance of weigh bridge is ensured on timely basis. Use T-

Code IP23, IW33, IW39.

23.TA.6 LPG - Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Verification/Analysis Risk 1. Over/Under Utilization of manpower.




23.TA.7 LPG - Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material/services Nature of Work Step Verification Risk 1. Delays in payments.








delays.

Audit Checklist

401

23.TA.8 Safety- Compliances with HSE standards Control Objective Checklist of HSE norms, compliances of same on time Nature of Work Step Verification Risk Non Compliance with HSE Standards. Nature of Control Manual/Automated

1. To check if the comprehensive checklist of various HSE compliances is maintained. Use T-code

S_SH8_72000033.

2. To check if there exist approved Safety policy and employees are aware of the same. Use T-code

S_SH8_72000033.

3. To check if the checklist of compliances is monitored and updated on continuous basis.

4. To check if there exists the mechanism of ensuring the compliances to all statutory

requirements.

5. To check if the action plan is documented and adhered for the identified non compliances.

6. To check if various statutory reports and MIS are correctly prepared.

7. To check if various statutory reports and MIS are submitted timely to various statutory

authorities.

23.TA.9 Safety- Training of employees Control Objective Employees are trained, aware of the safety equipment, zero accidents Nature of Work Step Verification Risk 1. Untrained employees.

2. Accidents. Nature of Control Manual/Automated

1. To check whether employees are trained for compliance to safety requirements. Use T-code

S_SH8_72000013.

2. To check accidents due to lack of training with respect to operation and maintenance of

equipment. Use T-code S_ALN_01001346.

3. To check the number of accidents occurred during the year and the reasons for same are

documented and analyzed for not repeating in future. Use T-code S_ALN_01001346, CBIH83.

4. To check whether any personal injury was caused due to lack of proper training. Use T-code

S_SH8_84000003.

5. To check whether any loss to asset was made due to improper training. Use T-code CG54,

CBIH83.

6. To check whether all the statutory training required under any act are planned and conducted.

Use T-code CG54.

7. To check if the control measures are adapted to control any incident in future. Use T-code

S_SH8_84000007.

23.TA.10 Safety- Periodic audits & inspections Control Objective To avoid Pollution complaints, statutory penalties and other

environmental losses Nature of Work Step Verification Risk Statutory penalties. Nature of Control Manual/Automated

1. To check if any complaint has been registered against the Company for causing pollution of any

kind like air, water etc.

2. To check whether periodic audits regarding environment safety has been conducted and the

observations of such audits are monitored and complied.

Audit Checklist

402

3. To check whether periodic inspection has been conducted internally and results are monitored.

4. To check if checklist / manual of compliances is updated with the deviations noted during

various audits. Use T-code S_SH8_72000033.

23.TA.11 Safety- Statutory clearances and permission Control Objective Availability of all Statutory Clearances and permission Nature of Work Step Verification Risk Non availability of statutory clearances and permission. Nature of Control Manual/Automated

1. To check if the tracker is maintained to monitor the clearances to be obtained by the

department. Use T-code S_SH8_72000033.

2. To check if all the required clearances have been obtained by the department. Use T-code

S_SH8_72000033.

3. To check if there exists a checklist of the documents required to be filed for the required

clearances. Use T-code S_SH8_72000033.

4. To check if there is adequate follow up done to ensure time receipt of all clearances.

5. To check if the renewal process is started in timely basis for the clearances nearing expiry.

23.TA.12 Safety- Disposal of waste, hazardous chemicals and other by products

Control Objective Disposal of waste, Hazardous chemicals and other by products as per

statutory requirements Nature of Work Step Verification Risk Non Compliance to statutory requirement. Nature of Control Manual/Automated

1. To check that Company has a well-defined disposal plan for disposal of hazardous waste. Use T-

code S_SH8_72000789.

2. To check that waste is processed before disposal, so as to cause minimum damage. Use T-code

WAE03.

3. To check compliance with ISO manual to prevent water and air pollution. Use T-code WAE03.

4. To check whether a disposal is done as per the statutory requirements and guidelines

prescribed for disposal. Use T-code S_SH8_72000023, CG54.

5. To check whether company has obtained all required approvals and clearances for disposal. Use

T-code CG54.

23.TA.13 Safety- Handling safety issues Control Objective Ensuring least safety concerns and timely action over incidents Nature of Work Step Verification Risk Non Compliance to safety norms. Nature of Control Manual/Automated

1. To check if adequate systems are installed to identify leakages on timely basis.

2. To check if defective cylinders are removed and not used for filling the LPG.

3. To check if condition and weight of the cylinder is duly verified before filling.

4. To check if over filling is not done in the cylinders/tanker.

5. To check first aid box is available and necessary medicines are available in same. Use T-code

CBIH13.

6. To check the expiry dates of medicines.

Audit Checklist

403

7. To check the number of accident occurred during the audit period and the loss suffered due to

same. Use T-code CBIH83.

8. To check the reason for such accident and whether it was due to poor maintenance or other

uncontrollable factor. Use T-code CBIH83.

9. To check the steps taken to avoid any possibility of any such future risk. Use T-code CBIH83.

10. To check that safety equipment like fire detectors, gas leakage alarms are installed.

11. To check that equipment are regularly serviced. Also check the maintenance/calibration due

dates of equipment. Use T-code IW33, IW39.

12. To check whether CCTV cameras have been installed in the production area and also check

whether security person is available to monitor the same.

13. To check whether fire audit has been carried out for the installations.

23.TA.14 Maintenance- SOP Compliance Control Objective Compliance of SOP Nature of Work Step Analysis/Verification Risk 1. Non-compliance to SOP.

2. Non-Compliance to ISO guidelines. Nature of Control Manual

1. Check that company has a well defined SOP for LPG Plant.

2. Check that all process are being followed as per SOP.

3. Check any deviation from SOP and document the reason given for same.

4. Check that ISO standards have been met with.

23.TA.15 Maintenance- Preventive maintenance Control Objective Completion of maintenance on time Nature of Work Step Analysis/Verification Risk Unavailability of equipment. Nature of Control Manual

1. To check whether preventive maintenance plan is prepared and approved. Use T-code IP23,

IW33, IW39.

2. To check if the preventive maintenance plan is followed in all cases. Use T-code IP23, IW33,

IW39.

3. To check the reasons and approvals for deviations from approved maintenance plan.

4. To check if the equipment/ machines not covered during actual maintenance as per plan are re-

scheduled for maintenance. Use T-code IP23, IW33, IW39.

5. To check if the past breakdowns and machine conditions are considered while preparing the

maintenance plan. Use T-code IP23, IW29, IW33, IW39.

Audit Checklist

404

23.TA.16 Maintenance- Breakdown maintenance Control Objective Completion of maintenance on time Nature of Work Step Analysis/Verification Risk Unavailability of equipment. Nature of Control Manual

1. To check whether service is availability 23*7 to ensure timely service of any breakdown in the

plant. Use T-code IP23, IW29, IW33, IW39.

2. To check for delay in providing maintenance services resulting in loss of production.

3. To check that manpower are allocated as per plan only so as to avoid any delay.

4. To check that adequate maintenance is carried out on timely basis to avoid breakdown. Use T-

code IP23, IW33, IW39.

5. To check that statutory compliance checklist is analyzed and updated regularly. Use T-code

IA07, IW33, IW39.

23.TA.17 Maintenance- Safety Control Objective Availability of protective devices, strict adherence to safety measures Nature of Work Step Verification Risk Loss to asset and life. Nature of Control Automated/Manual

1. To check the maintenance service schedule. Use T-code IW33, IW39.

2. To check whether safety devices are kept for maintenance people and no one is allowed entry

without them.

3. To check whether safety guidelines are defined for maintenance function and the same are

followed.

4. To check permit is issued and approved by designated authority before performing critical

maintenance activity. Use T-code IPMD.

23.TA.18 Maintenance- Training to workers Control Objective Providing on site and off site training Nature of Work Step Verification/Analysis Risk Lack of training to workers. Nature of Control Automated/Manual

1. To check if the training is scheduled for all employees based on need identification.

2. To check steps taken to update workers with new machinery and technology.

3. To check if all mandatory and statutory trainings are provided to all workers.

4. To check if performance is analyzed and training needs are identified on the basis of same.

23.TA.19 Maintenance- Security Control Objective To minimize risk of thefts and prevent financial losses Nature of Work Step Verification Risk Financial loss. Nature of Control Manual

1. Check that management has identified critical areas in terms of thefts.

2. Check the management has a plan of action to stop any theft.

3. Check that CCTV's are in place to track any such case and is monitored by a security person.

4. Check any major theft reported during the audit period.

Audit Checklist

405

23.TA.20 Maintenance- Statutory compliances Control Objective To ensure compliance to various statutory requirements Nature of Work Step Verification Risk Statutory non-compliance. Nature of Control Manual


complying the same.



4. Check whether all the statutory compliances are ensured by the department.

23.TA.21 Maintenance- Tools, spares and other expenses Control Objective To ensure adequate controls over expenses Nature of Work Step Verification Risk Inadequate control over expenses. Nature of Control Automated/Manual

1. Use T-Code S_ALR_87013542 to check if expenses are incurred within the approved budget.

2. Use T-Code ME53N, ME5A to check if all indenting is approved as per DOP.

3. Use T-Code MB52 to check if all the material issues are duly approved and recorded.

4. Use T-Code ME53N, ME5A, ME23N, ME2N to check all procurement is carried out as per

defined company policy.

5. Check if amount spent is adequately utilized for the purpose.

23.TA.22 Maintenance- HSE compliances Control Objective Compliance with HSE laws Nature of Work Step Verification Risk Non-Compliance to HSE laws. Nature of Control Automated/Manual

1. Use T-Code S_ALN_01001342 to check that all HSE norms are complied with.

2. Use T-Code S_SH8_72000002 to check that health of workers is not compromised on any count.

3. Use T-Code S_ALN_01001342 to check that adequate safety measures are available within the

premise and workers are asked to adhere to the same.

Audit Checklist

406

24. Materials Management- Technical Audit

Scope Audit Areas

1 Budgeting

2 Material planning & monitoring

3 Operations


5 Purchase order

6 Vendor development and enlistment

7 Notice Inviting Tender (NIT)


9 Bid security


11 BEC/BRC

12 Two-bid system

13 Open tendering

14 Limited tendering/ Single tendering/ Emergency procurement

15 Spot purchases

16 Annual rate contract

17 Procurement of medicines

18 Receipt of bid

19 Opening of bid

20 Evaluation of bids, preparation of Tender Tabulation / Purchase Proposal Committee Resolution (TCR) and award & signing of the PO contract

21 Placement of order


23 Amendment to order

24 Follow-up

25 Replacement Supply

26 Receipt of material

27 Issuance of material

28 Demurrage

29 Storage

30 Scrap disposal

31 Insurance

32 DGCA permit and Explosives license

33 Monitoring of lead times from PR to PO issuance.

34 PR tracking



Audit Checklist

407

24.TA.1 BEC/BRC Control Objectives Approved BEC/BRC




1. Check whether BEC/BRC have been approved before issuing notice for tender. 2. Check if standard BEC/BRC have been used in the tender as per Purchase Manual. 3. Check if BEC/BRC have been approved as per DOP in case of any deviation. 4. Check whether changes made, if any have been approved as per DOP and communicated to

bidders timely.

24.TA.2.1 Storage

Control Objectives Avoid pilferage/spoilage/ damage of inventory


Risk Inefficient usage of resources.


1. Check whether the storage space requirement has been monitored and changed as per the business needs.

2. To conduct a walkthrough of the storage and issuance of materials process and identify gaps, if any.

3. Check whether there is a process to monitor pilferages/damage/spoilage of stored inventory. 4. Check whether reasoning analysis is done to analyze reasons for pilferages /damage /spoilage

and steps are taken to avoid he same in future. 5. Check whether there is a process to ensure FIFO process in material issuance. 6. Check whether the materials are stored in appropriate bins/racks to avoid mixing/

misplacement of materials. 7. Check whether the godowns are in compliance with the statutory storage norms applicable. 8. Check whether the godowns have adequate security and fire protection system. 9. Check whether adequate insurance cover has been obtained for the stored inventory. 10. Check whether there is a process of monitoring the value of inventory and obtaining extra

insurance cover, if required. 11. Check whether there is a schedule for carrying out physical verification. 12. Check whether the physical verification schedule is complied with. 13. Check if reasoning analysis is done for variances observed. 14. Check if the difference are written off timely after taking approval as per DOP. 15. To ensure that there are strong storage/stacking and segregation norms so as to avert

inventory loss. The SAP T-code is MB52. 16. Check if maker-checker control exists between the person responsible for inventory

management and the person conducting physical verification. 17. Check if any license is required from designated authority for storage of specific goods. Check

the validity of the licenses and ensure there is no delay in renewal or expiry of various licenses.

Audit Checklist

408

24.TA.2.2 Storage Control Objectives To verify that the policies and procedure for warehouse

management is clearly defined and communicated.


Risk Distortion of inventory records, which may lead to: 1. Over stocking of inventory may result in blockage of working

capital. 2. Under stocking of inventory may result in disruption of operations

due to non-availabilityof required items. 3. Pilferage may occur in absence of proper controls.


1. Understand the policies and procedures defined for issuance and consumption of material, stores, spares and consumables.

2. Obtain listing of goods issued and consumed during the audit period. Use T-Code MB51. 3. On sample basis check whether the records of the goods issued, consumed, obsolete etc. are

maintained are per the defined policies and procedures. 4. Obtain the list of access rights for receipt and issuance of material analyze if same person has

performed different functions in same transactions.

24.TA.2.3 Storage

Control Objectives To verify that the preservation procedures and schedules are implemented to maintain the material in storage facility.


Risk Material getting damaged due to inadequate preservation mechanism, finally resulting in financial losses / property damage.


1. Obtain a list of equipment, spares & other items in warehouse. 2. Verify for availability for maintenance schedule of equipment, spares & other items in

warehouse. Use T-Code IP10/IP24 and IW29/IW39. 3. Check adherence to preservation schedule for other items through documents and by doing a

physical verification. 4. Discuss and report any observation.

24.TA.2.4 Storage

Control Objectives To verify that obsolete, defective and damaged items are properly identified, physically segregated and counted separately.


Risk Blockage of working capital in obsolete inventory.


1. Check if the obsolete stock is bifurcated physically and in the system from fresh stock. 2. Check for adequacy of provision for obsolete inventory and existence of a disposal plan. 3. Verify timely disposal of obsolete material. 4. Discuss reason for exception and report the same.

Audit Checklist

409

24.TA.2.5 Storage

Control Objectives To verify that the slow moving materials are identified and physically segregated.


Risk Blockage of working capital in slow moving inventory due to continuous procurement.


1. Review the inventory ageing report to highlight obsolete and non-moving inventory. 2. Check for the existence of a disposal plan. 3. Check for adequacy of provision for old and obsolete inventory. 4. Use T-code MC46 and MC50 for inventory ageing and check whether there is a process for

monitoring over obsolete / slow / non-moving / materials or spares and appropriate decisions are taken for the same. Check whether details of rejected/ obsolete/ non-moving inventory are reported as part of MIS.

5. Discuss reason for exception and report the same.

24.TA.3 Scrap disposal

Control Objectives Pilferage of scrap


Risk 1. Inappropriate approval for disposal. 2. Non-compliance to safety norms.


1. Check whether there is process for identifying scrap items. 2. Check the compliance of the process for identification of scrap, if any. 3. Check whether the scrap items are disposed/auctioned timely after taking adequate approval as

per DOP. 4. To ensure that there is authorized disposal of scrap. The SAP T-Code is SUIM. 5. 5. Check whether environment and safety norms are complied with in case of scrapping of

materials containing chemical/radioactive materials etc.

24.TA.4 Creation of Service Entry Sheet (SES) Control Objectives Timely and accurate receipt of material/services



Nature of Control

Manual / Automated

Audit Checklist

410







delays.

Audit Checklist

411

26. Pipe Line Fields – Technical Audit

Scope Audit scope

1 Planning, preparation and budget


3 Construction of Crude Oil Flow lines and Crude Oil Delivery (COD) Lines

4 Maintenance of Crude Oil Delivery (COD) lines

5 Construction of Natural Gas Flow lines and Transportation Lines

6 Maintenance of Natural Gas, transportation lines

7 Construction of formation water disposal lines

8 Maintenance of formation water disposal lines

9 Installation of Indirect Heater

10 Operation

11 PR Tracking

12 Creation of Service Entry Sheet


Audit Checklist

412

26.TA.1 Environment, Health and Safety Compliance Control Objective Safeguarding interest of Company / employees / public / environment Nature of Work Step Verification Risk Non Compliance to EH&S. Nature of Control Manual

1. To check whether there is a compliance framework related to statutory requirement for EH&S.

2. To check whether EH&S compliance framework is monitored and reviewed on regular basis.

3. To check whether compliance of Safety Manual is ensured and documented.

4. To check whether required documents/report/returns are filed on monthly/ quarterly/annually

basis to Govt./State Govt./Authorities/ Atomic Energy Regulatory Board (AERB).

5. To ensure adequate measures are undertaken to mitigate the risk in case of pipeline burst.

26.TA.2 Construction of Crude Oil Flow lines and Crude Oil Delivery (COD) Lines Control Objective Proper process undertaken for construction of pipelines Nature of Work Step Analysis/Verification Risk Inadequacies in construction of pipeline. Nature of Control Manual

1. To check the integrity of the pipeline i.e. construction of pipeline should be as per ASME B 31.4,

API 1104, & coating as per AWWA 203C.

2. To check that radiography, X-ray test has been conducted for welding done on pipelines as per

defined procedures.

3. Check that the welders involved in welding have certification for Welders Qualification Test

(WQT).

4. To check if peel test and holiday test has been undertaken for coating and wrapping.

5. To verify whether hydro tests are conducted to check the continuity of the pipeline.

6. To check that leak detection, pilferage, encroachment, asset lifecycle management,

replacement policy are checked by the user department and timely informed to the PLF

department.

7. To check if tests are carried out through the length of the pipeline during construction and

commissioning.

26.TA.3 Maintenance of Crude Oil Delivery (COD) Lines Control Objective Choke free and free flow of delivery lines Nature of Work Step Analysis/Verification Risk Interruption in delivery lines. Nature of Control Manual

1. To check that pressure is relieved from the pipeline before commencing of repair to ensure that

there is no fire during the leak repair of the pipeline.

2. To check that pigging operation of pipeline is conducted as per defined schedule.

3. To check whether there are delays / difficulties in identification of choked line.

4. To check that pressure test is carried out after the repair of the pipeline.

Audit Checklist

413

26.TA.4.1 Maintenance of Crude Oil Delivery (COD) Lines Control Objective Safety Nature of Work Step Verification Risk No safety/ precautionary measures. Nature of Control Manual

1. To check that precautionary safety measures are undertaken like using proper PPEs, requisition

of Fire Service on standby duty at site.

26.TA.4.2 Construction of Natural Gas Flow lines and Transportation Lines Control Objective Proper process undertaken for construction of pipelines Nature of Work Step Analysis/Verification Risk Inadequacies in construction of pipeline. Nature of Control Manual




defined procedures.


(WQT).





department.


commissioning.

26.TA.5.1 Maintenance of Natural Gas, transportation lines Control Objective Choke free and free flow of delivery lines Nature of Work Step Analysis/Verification Risk Interruption in delivery lines. Nature of Control Manual



2. To check that leak test is carried out after repair of the pipeline.



26.TA.5.2 Maintenance of Natural Gas, transportation lines Control Objective Safety Nature of Work Step Verification Risk No safety/ precautionary measures. Nature of Control Manual


of Fire Service on standby duty at site.

Audit Checklist

414

26.TA.6 Construction of formation water disposal lines Control Objective Proper process undertaken for construction of pipelines Nature of Work Step Verification Risk Inadequacies in construction of pipeline. Nature of Control Manual




defined procedures.


(WQT).





department.


commissioning.

26.TA.7.1 Maintenance of formation water disposal lines Control Objective Repair and replacement Nature of Work Step Analysis/Verification Risk Delay in repairs. Nature of Control Manual

1. To check whether there is timely repair of pipeline as and when asked by the user department.


3. To check that there is timely replacement of corroded portion of pipeline.

26.TA.7.2 Maintenance of formation water disposal lines Control Objective Choke free and free flow of delivery lines Nature of Work Step Analysis/Verification Risk Interruption in delivery lines. Nature of Control Manual



2. To check that leak test is carried out after repair of the pipeline.


26.TA.7.3 Maintenance of formation water disposal lines Control Objective Safety Nature of Work Step Verification Risk No safety/ precautionary measures. Nature of Control Manual

1. To check that precautionary safety measures are undertaken like using proper PPEs,

requisition of Fire Service on standby duty at site.

Audit Checklist

415

26.TA.8.1 Installation of Indirect Heater Control Objective Proper Installation Nature of Work Step Analysis/Verification Risk Improper installation and no integrity check. Nature of Control Manual

1. To check there is correct laying of foundation casting and installation of 2"" fuel lines and 4""

flow lines.

2. To check the integrity of the pipeline.

3. To ensure adequate measures are undertaken to mitigate the risk unforeseen social and local

problems.



commissioning.

6. To check if there is daily progress reporting by the contractors and departmental engineers.

26.TA.9.2 Installation of Indirect Heater Control Objective Safety Nature of Work Step Verification Risk No safety/ precautionary measures. Nature of Control Manual

1. To check that precautionary safety measures are undertaken like using proper PPEs,

requisition of Fire Service on standby duty at site.

26.TA.10.1 Operation Control Objective Budget approval Nature of Work Step Analysis/Verification Risk Unauthorized expenditure. Nature of Control Manual

1. To check that route survey and land acquisition of the track are carried out after the user

department gets the budget approval and same is intimated to the respective department

timely.

26.TA.10.2 Operation Control Objective Timely update of Contracts Nature of Work Step Verification Risk Inadequate parameters or unfavorable conditions in the contracts. Nature of Control Manual

1. To check that the running contract for laying pipeline/installing in following areas of OIL's

operations are properly updated in the best interest of the Company:

a. Laying of crude oil flow lines,

b. Laying of Natural Gas flow lines,

c. Laying of formation water flow lines,

d. Installation of Indirect Heaters.

Audit Checklist

416

26.TA.10.3 Operation Control Objective Land acquisition Nature of Work Step Verification Risk Delay in land acquisition. Nature of Control Manual

1. To check if proper liasoning exists to acquire the complete land.

2. To check whether there is delay in handover of land.

3. To check that in case of encroachment of ROW, the same is informed to user and Land

department for proper action from their end.

26.TA.10.4 Operation Control Objective Availability of Material Nature of Work Step Analysis/Verification Risk Non material availability. Nature of Control Automated/Manual

1. Use T-Code CO09 to check whether there are delays in availability of material.

2. To check if there is unutilized material. Use T-Code MB52.

3. To check whether there is timely execution of the requisition from other departments. Use T-

code ME5A.

26.TA.10.5 Operation Control Objective Effective implementation of activities Nature of Work Step Analysis/Verification Risk Ineffective implementation of activities. Nature of Control Manual

1. To check if the user department send the requirement to PLF department on time.

2. To check if there is any requirement of PLF department after work over.

3. To check if cost benefit analysis is undertaken before outsourcing is undertaken for new

pipelines.

4. To check if timely measures are undertaken to overcome the problems that monsoon season

might pose.

5. To check whether health checkup of pipelines is done timely.

6. To check if intelligent pigging is done before carrying out pigging operation to save cost.

26.TA.10.5 Operation Control Objective Disposal of scrapped pipe Nature of Work Step Verification Risk Inappropriate disposal of scrap pipe. Nature of Control Manual

1. To check disposal action of scrapped pipe is done as per Company policy.

Audit Checklist

417

26.TA.11 Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Verification/Analysis Risk 1. Over/Under Utilization of manpower.




26.TA.12 Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material/services Nature of Work Step Verification Risk 1. Delays in payments.








delays.

Audit Checklist

418

27. Planning – Technical Audit

Scope Audit Areas

1 Budgeting and business plan

2 Budget monitoring

3 Pre-requisites for operations

4 MIS Reporting

5 Annual plan / MOU Targets

6 Inter departmental co-ordination

7 PR Tracking


9 Manpower Planning

Audit Checklist

419

27.TA.1 Budgeting and business plan Control Objective To ensure timely finalization of appropriate budget Nature of Work Step Verification/Analysis Risk Delay in finalization of budget. Nature of Control Manual/Automated

1. Check if the budget calendar is finalized in advance and circulated to all departments for

ensuring timely inputs.

2. Check if the monitoring is done to ensure timely receipt of departmental budgets.

3. Check if the verification of the inputs received from the departments is conducted to weed out

inaccuracies, if any.

4. Check the whether budgets are compiled and prepared on timely basis as per defined timelines

(Capital / Special Revenue / Revenue).

5. Check the timelines in receiving the budget proposals from the various departments.

6. Check the approvals over the budgets as per DOP. Use T-Code KSBL and enter cost center.

7. For special sanction for expenditure (special budget), check the request from the concerned

user department and approval from competent authority.

8. Check if the assumptions taken for the budgeting purpose are adequately documented and

approved. Use T-Code CV03N and enter document number.

9. Map the targets set with Memorandum of Understanding (MoU) and minutes of the board

meeting. Use T-Code KSBL.

27.TA.2 Pre-requisites for operations Control Objective Safeguard interest of the Company Nature of Work Step Verification Risk Non Compliance to mandatory requirements. Nature of Control Manual

1. Check whether all the mandatory lease and license have been obtained / renewed as per

statutory requirements (Exploration License, explosives storage license & Mining lease etc.).

2. Check if a tracker is maintained to ensure timely renewal of required licenses and clearances.

3. Check if proper documentation and follow up is ensured for delays in obtaining the required

clearances.

27.TA.3 MIS Reporting Control Objective Communication of right information at right time to facilitate decision

making. Nature of Work Step Verification/Analysis Risk Inadequacy of MIS reported. Nature of Control Manual

1. Check if the all type of MIS are prepared and Circulated in timely basis.

2. Check if the MIS prepared is verified for ensuring accuracy before circulating.

3. Check if adequate control is in place to prevent leakage of confidential and sensitive

information. (E.g. Access control and dedicated responsible persons)

4. Check sample figures from the input data to ensure accuracy of MIS. (Also verify with data from

SAP wherever applicable)

5. Check if the SOP of collection, processing and presentation of information is defined.

27.TA.4 Annual plan / MOU Targets Control Objective To ensure correct recording and reporting of information

Audit Checklist

420

Nature of Work Step Verification Risk Inaccurate information. Nature of Control Manual

1. Check if the information circulated for the purpose of Annual Plan / MOU is accurately

calculated and reported.

2. Check if the monitoring of Annual Plan/ MOU targets is performed in a defined manner and

figures reported are accurately estimated.

27.TA.5 Inter departmental co-ordination Control Objective To ensure timely communication to Government authorities Nature of Work Step Verification Risk Delay in approval of plan from respective Government authorities. Nature of Control Manual

1. Check whether a tracker has been prepared for queries given by Government departments.

2. Check whether a tracker has been prepared for information to be furnished to Government

departments.

3. Review whether documents were submitted to the respective departments on timely basis.

4. Review whether the information provided was accurate.









delays.

Audit Checklist

421

28. Production Gas – Technical Audit

Scope Audit Areas

Production Gas -P & D


2 Monitoring



5 PR tracking


7 Manpower planning


Production Gas - Projects

1 SOP compliance

2 Projects


4 Operations



7 Safety


9 Security



12 HSE compliances

Production Gas - SCADA

1 Monitoring through SCADA

2 Projects


4 Calibration



7 Maintenance

8 PR tracking


Production Gas - NAGFD



3 Manpower planning


5 Well stimulation services

6 Commissioning and work over

Audit Checklist

422

7 Gas flaring

Production Gas -Admin & MSO





5 Administration

Production Gas -O & M

1 SOP Compliance


3 Maintenance




7 Safety




11 HSE compliances

Production Gas -GCS

1 SOP compliance

2 Operations

3 Safety



6 Maintenance

Production Gas -Gas Field



3 Work over operation

4 Dehydration of Natural Gas

5 Gas flaring

6 Resource planning and monitoring

Audit Checklist

423

28.TA.1 P & D - Contracting and receiving Control Objective Ensure effectiveness of contracting activities Nature of Work Step Analysis/Verification Risk Inefficient implementation of activities. Nature of Control Automated/Manual

1. Use T-Code ME23N, ME33K to ensure proper process exists for awarding and monitoring of

contracts.

2. Use T-Code ME23N, ME33K to check if all contracts are done after due assessment and

approvals as per DOP.

3. Use T-Code FBL1N, ME33K to check for approval of any deviation observed while executing the

contract and/or any action taken (e.g. imposition of LD/revision of contract cost etc.).

4. Use T-Code FBL1N to check whether price escalation, if any, was paid as per contract.

5. Use T-Code FBL1N to check whether Retention money is deducted from each running bill as per

Contract terms.

6. Use T-Code ME33K to verify that the contract is approved by a competent authority.

7. Check the number of incidents of contractor’s failure to provide promised services.

8. Use T-Code ML84 to check that SES entries are done based on bill certification by respective

user section.

9. Check whether there is existence of dual documentation/ dual record maintenance on account

of existence of manual as well as online entry in SAP.

28.TA.2 P & D - Billing and sales accounting Control Objective Ensure adequate and timely billing Nature of Work Step Analysis/Verification Risk Delay/ incorrect billing. Nature of Control Automated/Manual

1. Use T-Code VF03 to check that the quantities for invoicing are received from authorized person

of Production department.

2. Use T-Code VF03, VF05 to check whether invoices were raised as per defined timeliness.

3. Use T-Code FBL5N to check whether payment received from customer on time and interest

charged in case of delayed payment.

4. Use T-Code FBL3N to check whether reconciliation of Annual Returns has been done.

5. Use T-Code FBL3N to check whether reconciliation of return and payment of royalty, sales tax

etc. has been done.

28.TA.3 P & D - Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material/services Nature of Work Step Verification Risk 1. Delays in payments.




3. To check whether the manual records are verified and approved by concerned authority.

Audit Checklist

424

4. Use T-Code ML84 to view the list of SES's and ML81N to view the details of specific SES. Check whether the SES for the services received is timely prepared.

5. Check whether proper technical survey/inspection is carried out for quality assurance before creation of SES.

6. Check whether the inspection carried out is approved as per DOP. 7. Check whether there is a process of monitoring the date of completion as mentioned in the


delays.

28.TA.4 P & D - Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Verification/Analysis Risk 1. Over/Under Utilization of manpower.




28.TA.5 P & D - New project and achievements Control Objective Timely completion of task Nature of Work Step Verification Risk Delay may lead to excess cost and loss of goodwill. Nature of Control Manual

1. Check annual report for the new assignments undertaken and completed during the year and

compare the same with their expected date of completion.

2. Check the financial impact due to delay in completion of task.

28.TA.6 Projects - SOP compliance Control Objective Compliance of SOP Nature of Work Step Analysis/Verification Risk 1. Non-compliance to SOP.


1. Check that company has a well-defined SOP for servicing.




28.TA.7 Projects Control Objective Avoid Cost and Time Overruns Nature of Work Step Verification Risk 1. Cost overrun.

2. Delay in completion of project. Nature of Control Automated/Manual

Audit Checklist

425

1. Use T-Code KSBL to check if the adequate planning is done for timely completion of the project

within allocated budget.

2. Use T-Code CJ31, CJ33, S_ALR_87013558 to check if the periodic monitoring is done to avoid

any time and cost overrun.

3. Use T-Code KSBL to check if liquidation plan is available to catch up project delays (if any).

4. Use T-Code QGA2, QDH2 to check if proper quality checks are performed for all input material

and installations.

5. Check if the project commission and installation tests are performed and documented.

28.TA.8 Projects - Contract monitoring Control Objective To ensure contractual terms are followed by the contractor Nature of Work Step Verification Risk Breach of contractual terms. Nature of Control Automated/Manual

1. Check if there is a process to ensure regular monitoring of compliance of contractual terms by

contractor.

2. Check whether SES is created timely and after appropriate inspection of the service procured. Use

T-code ME33K, ME23N, ML81N.

3. Check whether the action for renewal of maintenance contracts are initiated timely.

28.TA.9 Projects - Operations Control Objective Completion of work on time in effective manner Nature of Work Step Verification Risk 1. Loss of operational efficiency.

2. Statutory non-compliance. Nature of Control Automated/Manual

1. Use T-Code ME53N, ME2S to check whether service is available all time to ensure timely service.

2. Use T-Code IW23, IW28, IW33, IW39 to check for delay in providing maintenance services

resulting in loss of operational efficiency.

3. Check that manpower are allocated as per plan only so as to avoid any delay.


28.TA.10 Projects - Cost control analysis Control Objective Minimum cost and maximum productivity Nature of Work Step Verification Risk Low productivity and excess cost incurred. Nature of Control Automated/Manual

1. Use T-Code CJ31, CJ33, S_ALR_87013558 to check whether the budget allocated for Projects is

utilized in effective manner.

2. Use T-Code S_ALR_87013532 to check the cost incurred for Projects and compare the same

with the allocated budget.

3. Use T-Code S_ALR_87013532 to check costs incurred due to accidents or injuries sustained

while performing project work.

4. Use T-Code IE03, IW33, S_ALR_87013532 to check extra expense incurred due to obsolete

equipment.

Audit Checklist

426

28.TA.11 Projects - New project and achievements Control Objective Timely completion of task Nature of Work Step Verification Risk Delay may lead to excess cost and loss of goodwill. Nature of Control Manual




28.TA.12 Projects - Safety Control Objective Availability of protective devices, strict adherence to safety measures Nature of Work Step Verification Risk Non- compliance to safety procedures and guidelines. Nature of Control Automated/Manual

1. Use T-Code IP24 to check the maintenance service schedule.

2. Use T-Code IE03, IH08 to check whether safety devices are kept for maintenance people and no

one is allowed entry without them.

3. Use T-Code IA07 to check whether safety guidelines are defined for maintenance function and

the same are followed.

4. Use T-Code IPMD to check permit is issued and approved by designated authority before

performing critical maintenance activity.

28.TA.13 Projects - Training to workers Control Objective Providing on site and off site training Nature of Work Step Verification Risk Untrained employees may lead to delay in completion of projects/

accidents at site. Nature of Control Manual

1. Check if the training is scheduled for all employees based on need identification.

2. Check steps taken to update workers with new machinery and technology.

3. Check if all mandatory and statutory trainings are provided to all workers.

4. Check if performance is analyzed and training needs are identified on the basis of same.

28.TA.14 Projects - Security Control Objective To minimize risk of thefts and prevent financial losses Nature of Work Step Verification Risk Financial loss. Nature of Control Manual





28.TA.15 Projects - Statutory compliances Control Objective To ensure compliance to various statutory requirements Nature of Work Step Verification Risk Statutory non-compliance.

Audit Checklist

427


complying the same.




28.TA.16 Projects - Tools, spares and other expenses Control Objective To ensure adequate controls over expenses Nature of Work Step Verification Risk Inadequate control over expenses. Nature of Control Automated/Manual







28.TA.17 Projects - HSE compliances Control Objective Compliance with HSE laws Nature of Work Step Verification Risk Non-Compliance to HSE laws. Nature of Control Automated/Manual





28.TA.18 SCADA - Monitoring through SCADA Control Objective Cost of acquisition, obsolete machinery Nature of Work Step Analysis/Verification Risk Weak budgetary control over cost of machinery. Nature of Control Automated/Manual

1. Use T-Code KSBL to check the cost of procuring assets and obtaining the cost benefit analysis.

2. Use T-Code S_ALR_87013542 to check any extra cost incurred due to obsolete machinery.

3. Check any loss of production or injury to person due to any external activity.

4. Use T-Code IP24, IW33, IW39 to check any delay in providing maintenance services resulting in

operational inefficiency.

5. Check any case of incorrect meter readings due to mechanical flow meters.

6. Check any wrong reporting due to inadequate controls on production reading.

28.TA.19 SCADA - Projects Control Objective Avoid Cost and Time Overruns Nature of Work Step Verification

Risk 1. Cost overrun.

2. Delay in completion of project.

Audit Checklist

428

Nature of Control Automated/Manual 1. Use T-Code KSBL to check if the adequate planning is done for timely completion of the project






and installations.


28.TA.20 SCADA - Tools, spares and other expenses Control Objective To ensure adequate controls over expenses Nature of Work Step Analysis/Verification Risk Weak budgetary control over expenses. Nature of Control Automated/Manual







28.TA.21 SCADA - Calibration Control Objective Ensure effectiveness of calibration process and activities Nature of Work Step Analysis/Verification Risk Incorrect calibration. Nature of Control Automated/Manual

1. Use T-Code IP24, IW33, IW39 to check if calibration plan is prepared.

2. Check if calibration plan is approved as per defined procedure.

3. Use T-Code IP24, IW33, IW39 to check if timely calibration is ensured for all equipment.

4. Check if there is any incorrect measurement due to non-calibration of tools and equipment.

28.TA.22 SCADA - Equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Analysis/Verification Risk Decreased life of equipment. Nature of Control Automated/Manual

1. Use T-Code IK07, IK17, S_ALR_87013422 to check whether the utilization of equipment is

reviewed regularly.

2. Use T-Code IP24 to check whether there is a maintenance schedule (preventive/regular) for

equipment and its compliance.

3. Use T-Code IP24, IW33, IW39 to check whether monitoring over turnaround time as per

schedule and actual time taken for maintenance of equipment is done.

4. Use T-Code QA33 to check whether the equipment are calibrated regularly.

5. Use T-Code IW23, IW28, IW33, IW39 to verify that minor repairs are handled on a timely basis

at the site by appropriate staff.

6. Use T-Code MMBE, MB52, MB5B to verify that adequate spares are maintained at the site to

facilitate repairs and maintenance.

Audit Checklist

429

7. Use T-Code IE03, IH08 to verify that replacements of equipment are undertaken timely before

the specified life expires.

8. Use T-Code IA07 to check whether monitoring is done for compliance to OEM guidelines for

operating equipment.

28.TA.23 SCADA - Maintenance Control Objective Timely closure of maintenance requests to avoid operational delay Nature of Work Step Analysis/Verification Risk Operational delays. Nature of Control Automated/Manual

1. Conduct a walkthrough of the process of getting requests for maintenance and identify gaps, if

any.

2. Check whether there is a maintenance schedule (preventive/regular) for equipment and its

compliance. Use T-Code IW39 to display the PM orders and IP24 to display the scheduling

overview list form.

3. Use T-Code IW23, IW28 to check whether the requests received only through SAP.

4. Use T-Code IW23, IW28 to check whether there is a creation of maintenance order.

5. In case of manual request, check the process of recording and monitoring the requests received.

6. Use T-Code IW23, IW28 to check whether an analysis is done for the time taken for closing a

request.

7. Use T-Code IW23, IW28 to see that proper notification is given about defects.

8. Check if root cause analysis is done for delays and steps are taken to avoid the same in future.

28.TA.24 SCADA - Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material/services Nature of Work Step Verification Risk 1. Delays in payments.








delays.

Audit Checklist

430

28.TA.25 NAGFD - Planning, budgeting & monitoring Control Objective Adequate planning and approvals, effective tracking of annual plan,


2. Delays in preparation of budget. Nature of Control Manual/Automated

1. Check whether the annual plan of Production Gas (NAGFD) department is complete and all-






a. Linked to the requirement





28.TA.26 NAGFD - Gas transportation Control Objective Ensure effectiveness of process Nature of Work Step Analysis/Verification Risk Ineffective transportation process leading to incurring of excess

expenses. Nature of Control Manual/Automated

1. Check that Gas is transferred for pumping only after the sample sent to laboratory for analysis is

found to be acceptable.

2. Check that formation water at all installations is disposed as per standards.

3. Use T-Code IP24 to verify flow Assurance from well head to Processing Installations to prevent

downtime.

4. Ensure that there is round the clock monitoring of well head equipment to prevent any form of

sabotage/pilferage.

5. Check if remedial action is undertaken against activities such as pilferage of condensate by

miscreants.

6. Use T-Code IK07,IK17, S_ALR_87013421 to ensure there is proper Primary Separation of

Reservoir Fluid (Crude Oil, Formation Water, Associated & Non Associated Gas).

7. Use T-Code IK07,IK17, S_ALR_87013421 to check whether water content is being measured.

8. Use T-Code MCUF, MCUC to verify uninterrupted logistics support for operations onshore.

9. Use T-Code QGA1, QGC1, QGC2, QGC2, QGA2 to check there is adequate QA / QC process

during Production (e.g. BS&W Issues).

10. Use T-Code MCUF, MCUC to check that there is effective monitoring of Gas transportation.

11. To ensure proper checks are being maintained on quantity at loading point and unloading point.

12. Check that a mechanism exists for monitoring of pilferages/ leakages while transportation.

13. Use T-Code QDH2 to check if quality sampling is being done (Daily/ Fortnightly).

28.TA.27 NAGFD - Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities

Audit Checklist

431

Nature of Work Step Verification/Analysis Risk 1. Over/Under Utilization of manpower.




28.TA.28 NAGFD - Training to workers Control Objective Providing on site and off site training Nature of Work Step Verification Risk Untrained employees may lead to delay in completion of projects/






28.TA.29 NAGFD - Commissioning and work over Control Objective Effective implementation of activities Nature of Work Step Verification Risk Inefficient implementation of activities. Nature of Control Manual

1. Check there is existence of defined plan for carrying out the commissioning of central gas

station

2. Check that specifications are available for material utilized.

3. Use T-Code S_ALR_87015125, S_ALR_87015124 to check whether the work is carried out as per

defined plan and completed in timely manner.

4. Use T-Code S_ALR_87013558 to check if the budget is monitored and no excess expenditure is

incurred.

5. Check if the reasons for any deviations are identified timely and action plan made.

28.TA.30 NAGFD - Commissioning and work over Control Objective Effective implementation of activities Nature of Work Step Verification Risk Inefficient implementation of activities. Nature of Control Manual

1. Check there is existence of defined plan for carrying out the commissioning of central gas

station

2. Check that specifications are available for material utilized.




incurred.


Audit Checklist

432

28.TA.31 NAGFD - Gas flaring Control Objective To ensure effectiveness of the monitoring process Nature of Work Step Analysis/Verification Risk Ineffective monitoring. Nature of Control Automated/Manual

1. Use T-Code MCXD, MCXX to verify the quantity of gas flared. To verify if gas flaring is on account

of customer not accepting gas and if charges for non–acceptance have been accounted for as

per agreement/MOU.

2. Use T-Code S_SH8_72000033 to verify if gas flared meets environmental norms.

3. Use T-Code S_ALN_01001342 to check if plans exist to reduce gas flaring.

4. Use T-Code S_SH8_72000033 to verify that adequate safety provisions are maintained for gas

flaring.

5. Use T-Code IK07,IK17, S_ALR_87013421 to verify whether proper maintenance is carried

whether maintenance schedule for equipment and instruments used for measuring the

quantum of gas flared were prepared and circulated.

28.TA.32 Admin & MSO - Health, safety and environment compliances Control Objective Safeguarding interest of Company / employees / public / environment Nature of Work Step Analysis/Verification Risk Non-compliance to HSE regulations. Nature of Control Manual

1. Verify that appropriate contingency plans and disaster recovery plans exists.

2. Check there is HSE compliances by contractors.

3. Check there is existence of adequate breakdown analysis and timely action over breakdowns.

4. Check whether compliance of Safety Manual is ensured and documented.



6. Check if the comprehensive checklist of various HSE compliances is maintained.

7. Check if there exist approved Safety policy and employees are aware of the same.

8. Check if the checklist of compliances is monitored and updated on continuous basis.

9. Check if there exists the mechanism of ensuring the compliances to all statutory requirements

(including but not limited to):

a. Mines Act.

b. Oils and Mines Regulations

c. Explosive Act and Rules.

d. OISD Standards.

e. Environment Protection Act

f. Water & Air Act.

g. Water Cess Act.

h. Hazardous Waste Management Act.

i. E. Waste.

j. Petroleum Act.

k. Explosive Act and Rules etc.

10. Check if the action plan is documented and adhered for the identified non compliances.

11. Check if various statutory reports and MIS are correctly prepared and submitted timely to

various statutory authorities as required.

Audit Checklist

433

28.TA.33 Admin & MSO - Periodic audits & inspections Control Objective Pollution complaints, statutory penalties and other environmental

losses Nature of Work Step Verification Risk Statutory non-compliance. Nature of Control Automated/Manual

1. Check if any complaint has been registered against the company for causing pollution of any

kind like Air, water etc.

2. Check whether adequate steps are taken by Company against the complaints filed against the

Company.

3. Check whether periodic audits regarding environment, safety has been conducted and the

observations of such audits are complied.

4. Use T-Code CBIHMR05 to check whether periodic inspection has been conducted internally and

results are monitored.

5. Check if checklist / manual of compliances is updated with the deviations noted during various

audits.

28.TA.34 Admin & MSO - Statutory clearances and permission Control Objective Availability of all Statutory Clearances and permission Nature of Work Step Analysis/Verification Risk Statutory non-compliance. Nature of Control Automated/Manual

1. Use T-Code IPMD to check if the tracker is maintained to monitor the statutory clearances to be

obtained.

2. Check if all the required clearances have been obtained by the department.

3. Use T-Code S_SH8_720000033 to check if there exists a checklist of the documents required to

be filed for the required clearances.

4. Check if there is adequate follow up done to ensure timely receipt of all clearances.

5. Check if the renewal process is started on timely basis for the clearances nearing expiry.

28.TA.35 Admin & MSO - Disposal of waste, hazardous chemicals and other by products

Control Objective Disposal of waste, Hazardous chemicals and other by products as per

statutory requirements. Nature of Work Step Analysis/Verification Risk Statutory non-compliance. Nature of Control Automated/Manual

1. Use T-Code CG54 to check that Company has a well-defined disposal plan for disposal of

hazardous waste.

2. Use T-Code CG54 to check that waste is processed before disposition so as to cause minimum

damage.

3. Check compliance with ISO manual for disposal of waste causing water and air pollution.

4. Use T-Code CG54 to check whether a disposal is done as per the statutory requirements and

guidelines prescribed for disposal.

5. Use T-Code CG54 to check whether company has obtained all required certificate and

clearances for disposal.

Audit Checklist

434

28.TA.36 Admin & MSO - Administration Control Objective To ensure timely and cost effective administrative procurement Nature of Work Step Analysis/Verification Risk 1. Inadequate cost incurred on administrative procurement.

2. Delay in administrative procurement. Nature of Control Automated/Manual

1. Use T-Code KSBL to check that budgets have been prepared in line with the future requirement

and duly approved as per DOP.

2. Use T-Code 'S_ALR_87013558 to check separate budgets have been prepared for CAPEX and

OPEX and monitored on regular basis.

3. Use T-Code 'S_ALR_87013532 to check whether there is process of ensuring actual performance

against the budgeted performance.

4. Check the reason for deviation, if any. Check whether adequate steps have been taken to

mitigate such deviation.

5. Check on sample basis whether the procurement process followed for admin procurement is in

line with company policy.

6. Use T-Code MMBE to check whether distribution of admin items is properly recorded.

7. Use T-Code MMBE, MB52, MB5B to check if procurement is done on need basis and proper

controls are in place to avoid wastages.

28.TA.37 O & M - SOP compliance Control Objective Compliance of SOP Nature of Work Step Analysis/Verification Risk 1. Non-compliance to SOP.






28.TA.38 O & M - Equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Analysis/Verification Risk Decreased life of equipment. Nature of Control Automated/Manual


reviewed regularly.










Audit Checklist

435





28.TA.39 O & M - Maintenance Control Objective Timely closure of maintenance requests to avoid operational delays Nature of Work Step Analysis/Verification Risk Operational delays. Nature of Control Automated/Manual


any.





request.



28.TA.40 O & M - Maintenance of pipelines Control Objective Timely maintenance for least damage Nature of Work Step Analysis/Verification Risk Decreased life of equipment. Nature of Control Automated/Manual

1. Use T-Code IP24, IW33, IW39 to check that timely maintenance of pipelines is done.

2. Use T-Code IP24 to check whether control is present in SAP to prompt due date of maintenance.

3. Use T-Code IP03,QA33 to check the periodicity and results of maintenance works performed.

4. Use T-Code IP24, IW33, IW39 to check any delay in maintenance schedule due to non-

availability of manpower.

28.TA.41 O & M - Issuing material for replacement Control Objective Minimum downtime during replacement Nature of Work Step Analysis/Verification Risk Operational delays. Nature of Control Automated/Manual

1. Use T-Code IE03, IH08 to check that pipelines are replaced on time.

2. Use T-Code IW23, IW28 to check the time taken from lodging a complaint to actual replacement

of pipelines.

3. Check the number of cases of leakage and financial loss suffered due to it.

4. Use T-Code MB52, MB5B, MMBE to check whether spares are issued on FIFO basis and no new

spare has been purchased which was already present in store.

28.TA.42 O & M - Breakdown analysis Control Objective No downtime or breakdown Nature of Work Step Analysis/Verification Risk Operational delays. Nature of Control Automated/Manual

Audit Checklist

436

1. Use T-Code IW39 to check the total number of hours of downtime.

2. Check the action taken to avoid frequent breakdowns.

28.TA.43 O & M - Safety Control Objective Availability of protective devices, strict adherence to safety measures Nature of Work Step Verification Risk Non- Compliance to Safety Procedures and Guidelines. Nature of Control Automated/Manual








28.TA.44 O & M - Training to workers Control Objective Providing on site and off site training Nature of Work Step Verification Risk Untrained employees may lead to delay in completion of projects/






28.TA.45 O & M - Statutory compliances Control Objective To ensure compliance to various statutory requirements Nature of Work Step Verification Risk Statutory non-compliance Nature of Control Manual


complying the same.




5.

28.TA.46 O & M - Tools, spares and other expenses Control Objective To ensure adequate controls over expenses Nature of Work Step Verification Risk Inadequate control over expenses. Nature of Control Automated/Manual




Audit Checklist

437




28.TA.47 O & M - HSE compliances Control Objective Compliance with HSE laws Nature of Work Step Verification Risk Non-compliance to HSE Laws. Nature of Control Automated/Manual





28.TA.48 GCS - SOP compliance Control Objective Compliance of SOP Nature of Work Step Analysis/Verification Risk 1. Non-compliance to SOP.






28.TA.49.1 GCS - Operations Control Objective Collection of Gas Nature of Work Step Analysis/Verification Risk Leakage of gas. Nature of Control Automated/Manual

1. Use T-Code MCPD to verify if the daily production reports are being maintained on regular basis

for the wells.

2. Verify if production targets are planned and the details communicated to the respective GCS.

3. Use T-Code S_ALR_87013142, S_ALR_87013143 to verify actual production meets planned

targets on daily/monthly/quarterly/annual basis.

28.TA.49.2 GCS - Operations Control Objective Pumping to Customer Nature of Work Step Analysis/Verification Risk Leakage of gas. Nature of Control Automated/Manual

1. Use T-Code VL06C to verify if gas is pumped to the customers as per the agreed time schedule /

MOU.

2. Use T-Code QC31 to verify that the gas intake certificate is obtained from the customer.

3. Verify that product reconciliation is regularly carried out with customers.

Audit Checklist

438

28.TA.49.3 GCS - Operations Control Objective Other operations Nature of Work Step Analysis/Verification Risk Leakage of gas. Nature of Control Automated/Manual

1. Use T-Code IK07, IK17, S_ALR_87013421 to verify that gas received at the gas compression plant

is compressed to required pressure.

2. Verify that the LPG plant extracts LPG from the gas supplied to it.

3. Verify the availability of the agreed upon custody transfer procedures in customer agreements.

4. Check if calibration of custody transfer meters are done in presence of customer representative.

28.TA.50 GCS - Safety Control Objective Availability of protective devices, strict adherence to safety measures Nature of Work Step Verification Risk Non- Compliance to safety procedures and guidelines. Nature of Control Automated/Manual








28.TA.51 GCS - Testing of flow lines Control Objective Ensure effectiveness of testing procedures Nature of Work Step Analysis/Verification Risk Leakage of gas. Nature of Control Automated/Manual

1. Use T-Code QP08 to verify if that inspection plans exist for maintenance of flow lines and lines

are regularly tested and inspected for damage or blockages.

2. Use T-Code IP24, IW23, IW39 to verify if maintenance of feeder and collector lines is done by

designated personnel.

3. Verify losses during transmission in the feeder lines.

28.TA.52 GCS - Equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Analysis/Verification Risk Decreased life of equipment. Nature of Control Automated/Manual


reviewed regularly.






Audit Checklist

439









28.TA.53 GCS - Maintenance Control Objective Timely closure of maintenance requests to avoid operational delays Nature of Work Step Analysis/Verification Risk Operational delays Nature of Control Automated/Manual


any.





request.



28.TA.54 Gas Field - Gas transportation Control Objective Ensure effectiveness of process Nature of Work Step Analysis/Verification Risk Ineffective transportation process leading to incurring of excess expenses. Nature of Control Automated/Manual

1. Check that Gas is transferred for pumping only after the sample sent to laboratory for analysis is

found to be acceptable.

2. Check that formation water at all installations is disposed as per standards.

3. Use T-Code IP24 to verify flow Assurance from well head to Processing Installations to prevent

downtime.

4. Ensure that there is round the clock monitoring of well head equipment to prevent any form of

sabotage/pilferage.

5. Check if remedial action is undertaken against activities such as pilferage of condensate by

miscreants.

6. Use T-Code IK07,IK17, S_ALR_87013421 to ensure there is proper Primary Separation of

Reservoir Fluid (Crude Oil, Formation Water, Associated & Non Associated Gas).

7. Use T-Code IK07,IK17, S_ALR_87013421 to check whether water content is being measured.

8. Use T-Code MCUF, MCUC to verify uninterrupted logistics support for operations onshore.

9. Use T-Code QGA1, QGC1, QGC2, QGC2, QGA2 to check there is adequate QA / QC process

during Production (e.g. BS&W Issues).

10. Use T-Code MCUF, MCUC to check that there is effective monitoring of Gas transportation.

11. To ensure proper checks are being maintained on quantity at loading point and unloading point.

12. Check that a mechanism exists for monitoring of pilferages/ leakages while transportation.

Audit Checklist

440

13. Use T-Code QDH2 to check if quality sampling is being done (Daily/ Fortnightly).

28.TA.55 Gas Field - Work over operation Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Analysis/Verification Risk 1. Decreased life of equipment.

2. Inefficient utilization of equipment. Nature of Control Automated/Manual

1. Check there is existence of defined plan for carrying out the commissioning and works over

activities.

2. Check that use of materials with adequate specifications is being done.

3. Check if down hole information is available before the start of work over.

4. Use T-Code IE03, IH08 to check that surface and sub-surface equipment is available.

5. Check for the condition of surface production facilities.




incurred.


28.TA.56 Gas Field - Dehydration of Natural Gas Control Objective Complete dehydration, maintaining the pressure Nature of Work Step Analysis/Verification Risk Loss of natural gas. Nature of Control Automated/Manual

1. Check the process of dehydration.

2. Use T-Code IK07, IK17, S_ALR_87013421 to check that adequate pressure required for

dehydration is maintained.

3. Check whether the company is having a backup plan to be executed in case of emergency.

28.TA.57 Gas Field - Gas flaring Control Objective To ensure effectiveness of the monitoring process Nature of Work Step Analysis/Verification Risk Ineffective monitoring. Nature of Control Automated/Manual

1. Use T-Code MCXD, MCXX to verify the quantity of gas flared. To verify if gas flaring is on account

of customer not accepting gas and if charges for non–acceptance have been accounted for as

per agreement/MOU.

2. Use T-Code S_SH8_72000033 to verify if gas flared meets environmental norms.

3. Use T-Code S_ALN_01001342 to check if plans exist to reduce gas flaring.

4. Use T-Code S_SH8_72000033 to verify that adequate safety provisions are maintained for gas

flaring.

5. Use T-Code IK07,IK17, S_ALR_87013421 to verify whether proper maintenance is carried

whether maintenance schedule for equipment and instruments used for measuring the

quantum of gas flared were prepared and circulated.

28.TA.58 Gas Field - Resource planning and monitoring Control Objective Ensure effective monitoring and supervision of manpower

Audit Checklist

441

Nature of Work Step Analysis/Verification Risk 1. Over/Under Utilization of manpower.

2. Operational delays caused due to low manpower. Nature of Control Automated/Manual

1. Verify that monitoring and evaluation of the performance of outsourced Operations/ works at

the installations is done.

2. Verify that adequate staff as per policy is available at the installations for effective performance

of operations.

3. Use T-Code IH08 to verify availability & effectiveness of communications devices.

4. Use T-Code S_ALR_87015125, S_ALR_87015124 to verify that all the operations required at the

platform are regularly monitored and carried out efficiently.

5. Verify co-ordination between installations and the base office.

Audit Checklist

442

29. Production Oil – Technical Audit Scope

Audit Areas

Production Oil -P & D


2 Monitoring



5 PR tracking


7 Manpower planning


Production Oil - Projects

1 SOP compliance

2 Projects


4 Operations



7 Safety


9 Security



12 HSE compliances

Production Oil - Administration & Contracts





5 Administration

6 Contracts

Production Oil - Operations

1 SOP Compliance


3 Maintenance




7 Safety




Audit Checklist

443

11 HSE compliances

Production Oil - Installations (ITF/OCS/EPS/WPS)

1 SOP compliance

2 Operations

3 Safety



6 Maintenance

7 ITF

Production Oil - Water Injection

1 Water Injection

Production Oil - Utility

1 Utility

Production Oil - WSS

1 Well Stimulation Services

2 Work over Operations

Audit Checklist

444

29.TA.1 P & D - Contracting and receiving Control Objective Ensure effectiveness of contracting activities Nature of Work Step Analysis/Verification Risk Inefficient implementation of activities. Nature of Control Automated/Manual

1. Use T-Code ME23N, ME33K to ensure proper process exists for awarding and monitoring of

contracts.

2. Use T-Code ME23N, ME33K to check if all contracts are done after due assessment and

approvals as per DOP.

3. Use T-Code FBL1N, ME33K to check for approval of any deviation observed while executing the

contract and/or any action taken (e.g. imposition of LD/revision of contract cost etc.).

4. Use T-Code FBL1N to check whether price escalation, if any, was paid as per contract.

5. Use T-Code FBL1N to check whether Retention money is deducted from each running bill as per

Contract terms.

6. Use T-Code ME33K to verify that the contract is approved by a competent authority.

7. Check the number of incidents of contractor’s failure to provide promised services.

8. Use T-Code ML84 to check that SES entries are done based on bill certification by respective

user section.

9. Check whether there is existence of dual documentation/ dual record maintenance on account

of existence of manual as well as online entry in SAP.

29.TA.2 P & D - Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material/services Nature of Work Step Verification Risk 1. Delays in payments.








delays.

29.TA.3 P & D - Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Verification/Analysis Risk 1. Over/Under Utilization of manpower.

Audit Checklist

445




29.TA.4 P & D - New project and achievements Control Objective Timely completion of task Nature of Work Step Verification Risk Delay may lead to excess cost and loss of goodwill. Nature of Control Manual




29.TA.5 Projects - SOP compliance Control Objective Compliance of SOP Nature of Work Step Analysis/Verification Risk 1. Non-compliance to SOP.






29.TA.6 Projects Control Objective Avoid Cost and Time Overruns Nature of Work Step Verification Risk 1. Cost overrun.


1. Use T-Code KSBL to check if the adequate planning is done for timely completion of the project






and installations.


29.TA.7 Projects - Contract monitoring Control Objective To ensure contractual terms are followed by the contractor Nature of Work Step Verification Risk Breach of contractual terms. Nature of Control Automated/Manual

Audit Checklist

446

1. Check if there is a process to ensure regular monitoring of compliance of contractual terms by

contractor.

2. Check whether SES is created timely and after appropriate inspection of the service procured.

Use T-code ME33K, ME23N, ML81N.

3. Check whether the actions for renewal of maintenance contracts are initiated timely.

29.TA.8 Projects - Operations Control Objective Completion of work on time in effective manner Nature of Work Step Verification Risk 1. Loss of operational efficiency.

2. Statutory non-compliance. Nature of Control Automated/Manual

1. Use T-Code ME53N, ME2S to check whether service is available all time to ensure timely service.

2. Use T-Code IW23, IW29, IW33, IW39 to check for delay in providing maintenance services

resulting in loss of operational efficiency.

3. Check that manpower are allocated as per plan only so as to avoid any delay.


29.TA.9 Projects - New project and achievements Control Objective Timely completion of task Nature of Work Step Verification Risk Delay may lead to excess cost and loss of goodwill. Nature of Control Manual




29.TA.10 Projects - Safety Control Objective Availability of protective devices, strict adherence to safety measures Nature of Work Step Verification Risk Non- compliance to safety procedures and guidelines. Nature of Control Automated/Manual








29.TA.11 Projects - Training to workers Control Objective Providing on site and off site training Nature of Work Step Verification Risk Untrained employees may lead to delay in completion of projects/


Audit Checklist

447





29.TA.12 Projects - Security Control Objective To minimize risk of thefts and prevent financial losses Nature of Work Step Verification Risk Financial loss. Nature of Control Manual





29.TA.13 Projects - Statutory compliances Control Objective To ensure compliance to various statutory requirements Nature of Work Step Verification Risk Statutory non-compliance. Nature of Control Manual


complying the same.




29.TA.14 Projects - Tools, spares and other expenses Control Objective To ensure adequate controls over expenses Nature of Work Step Verification Risk Inadequate control over expenses. Nature of Control Automated/Manual







Audit Checklist

448

29.TA.15 Projects - HSE compliances Control Objective Compliance with HSE laws Nature of Work Step Verification Risk Non-Compliance to HSE laws. Nature of Control Automated/Manual





29.TA.16 Administration and contracts - Health, safety and environment compliances Control Objective Safeguarding interest of Company / employees / public / environment Nature of Work Step Analysis/Verification Risk Non-compliance to HSE regulations. Nature of Control Manual

1. Verify that appropriate contingency plans and disaster recovery plans exists.

2. Check there is HSE compliances by contractors.

3. Check there is existence of adequate breakdown analysis and timely action over breakdowns.




6. Check if the comprehensive checklist of various HSE compliances is maintained.

7. Check if there exist approved Safety policy and employees are aware of the same.

8. Check if the checklist of compliances is monitored and updated on continuous basis.

9. Check if there exists the mechanism of ensuring the compliances to all statutory requirements

(including but not limited to):

a. Mines Act.

b. Oils and Mines Regulations

c. Explosive Act and Rules.

d. OISD Standards.

e. Environment Protection Act

f. Water & Air Act.

g. Water Cess Act.

h. Hazardous Waste Management Act.

i. E. Waste.

j. Petroleum Act.

k. Explosive Act and Rules etc.

10. Check if the action plan is documented and adhered for the identified non compliances.

11. Check if various statutory reports and MIS are correctly prepared and submitted timely to

various statutory authorities as required.

Audit Checklist

449

29.TA.17 Administration and contracts - Periodic audits & inspections Control Objective Pollution complaints, statutory penalties and other environmental

losses Nature of Work Step Verification Risk Statutory non-compliance. Nature of Control Automated/Manual

1. Check if any complaint has been registered against the company for causing pollution of any


2. Check whether adequate steps are taken by Company against the complaints filed against the

Company.

3. Check whether periodic audits regarding environment, safety has been conducted and the

observations of such audits are complied.

4. Use T-Code CBIHMR05 to check whether periodic inspection has been conducted internally and

results are monitored.

5. Check if checklist / manual of compliances is updated with the deviations noted during various

audits.

29.TA.18 Administration and contracts - Statutory clearances and permission Control Objective Availability of all Statutory Clearances and permission Nature of Work Step Analysis/Verification Risk Statutory non-compliance. Nature of Control Automated/Manual

1. Use T-Code IPMD to check if the tracker is maintained to monitor the statutory clearances to be

obtained.

2. Check if all the required clearances have been obtained by the department.

3. Use T-Code S_SH8_720000033 to check if there exists a checklist of the documents required to

be filed for the required clearances.

4. Check if there is adequate follow up done to ensure timely receipt of all clearances.

5. Check if the renewal process is started on timely basis for the clearances nearing expiry.

29.TA.19 Administration and contracts - Disposal of waste, hazardous chemicals and

other by products Control Objective Disposal of waste, Hazardous chemicals and other by products as per

statutory requirements. Nature of Work Step Analysis/Verification Risk Statutory non-compliance. Nature of Control Automated/Manual

1. Use T-Code CG54 to check that Company has a well-defined disposal plan for disposal of

hazardous waste.

2. Use T-Code CG54 to check that waste is processed before disposition so as to cause minimum

damage.

3. Check compliance with ISO manual for disposal of waste causing water and air pollution.

4. Use T-Code CG54 to check whether a disposal is done as per the statutory requirements and

guidelines prescribed for disposal.

5. Use T-Code CG54 to check whether company has obtained all required certificate and

clearances for disposal.

Audit Checklist

450

29.TA.20 Administration and contracts - Administration Control Objective To ensure timely and cost effective administrative procurement Nature of Work Step Analysis/Verification Risk 1. Inadequate cost incurred on administrative procurement.

2. Delay in administrative procurement. Nature of Control Automated/Manual

1. Use T-Code KSBL to check that budgets have been prepared in line with the future requirement

and duly approved as per DOP.

2. Use T-Code 'S_ALR_87013558 to check separate budgets have been prepared for CAPEX and

OPEX and monitored on regular basis.

3. Use T-Code 'S_ALR_87013532 to check whether there is process of ensuring actual performance

against the budgeted performance.

4. Check the reason for deviation, if any. Check whether adequate steps have been taken to

mitigate such deviation.

5. Check on sample basis whether the procurement process followed for admin procurement is in

line with company policy.

6. Use T-Code MMBE to check whether distribution of admin items is properly recorded.

7. Use T-Code MMBE, MB52, MB5B to check if procurement is done on need basis and proper

controls are in place to avoid wastages.

29.TA.21 Administration and contracts - Contracts Control Objective Formulation and execution of contracts Nature of Work Step Verification Risk 1. Unauthorized awarding of contracts

2. Non-monitoring of contractual terms Nature of Control Manual

1. To check the contracts for Crude oil transportation, Labor Supply (Listed / Unlisted), Services,

Major global contract (For services)

2. To ensure proper process exists for awarding and monitoring of contracts

3. Use transaction code ME3J, ME5A to check that contracts are being effectively implemented

4. Use ME3N to check for approval of any deviation observed while executing the contract and/or

any action taken (e.g. imposition of LD/revision of contract cost etc.).

5. To check whether there was any price escalation, if any, was paid as per contract.

6. Use S_ALR_87012167 to check whether Retention money is deducted from each running bill as

per Contract terms

7. To verify that the contract is approved by a competent authority.

8. To check the number of incidents of contractors failure to provide promised services

29.TA.22 Administration and contracts - Contracts Control Objective Effective implementation of activities Nature of Work Step Verification Risk Non- monitoring may lead to delay in implementation or ineffective

implementation Nature of Control Manual

1. Use transaction code VL04 to check that there is effective monitoring of crude oil transportation

2. To check if hindrance register has been maintained

3. Use transaction code VL06O to ensure proper checks are being maintained on quantity at

loading point and unloading point

Audit Checklist

451

4. Use transaction code VL06O to ensure that a check is maintained on crude oil pilferages/

leakages while transportation

5. Use transaction code MCXB, MCXD to check if quality sampling is being done (Daily/ Fortnightly)

6. To check that SES entries are done based on bill certification by respective user section

7. To check the existence of dual documentation/ dual record maintenance on account of

existence of both SAP and manual processes.

29.TA.23 Operations - SOP compliance Control Objective Compliance of SOP Nature of Work Step Analysis/Verification Risk 1. Non-compliance to SOP.


1. Check that company has a well defined SOP for servicing.




29.TA.24 Operations - Equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Analysis/Verification Risk Decreased life of equipment. Nature of Control Automated/Manual


reviewed regularly.














29.TA.25Operations - Maintenance Control Objective Timely closure of maintenance requests to avoid operational delays Nature of Work Step Analysis/Verification Risk Operational delays. Nature of Control Automated/Manual


any.



Audit Checklist

452



request.



29.TA.26 Operations - Maintenance of pipelines Control Objective Timely maintenance for least damage Nature of Work Step Analysis/Verification Risk Decreased life of equipment. Nature of Control Automated/Manual

1. Use T-Code IP24, IW33, IW39 to check that timely maintenance of pipelines is done.

2. Use T-Code IP24 to check whether control is present in SAP to prompt due date of maintenance.

3. Use T-Code IP03,QA33 to check the periodicity and results of maintenance works performed.

4. Use T-Code IP24, IW33, IW39 to check any delay in maintenance schedule due to non-

availability of manpower.

29.TA.27 Operations - Issuing material for replacement Control Objective Minimum downtime during replacement Nature of Work Step Analysis/Verification Risk Operational delays. Nature of Control Automated/Manual

1. Use T-Code IE03, IH08 to check that pipelines are replaced on time.

2. Use T-Code IW23, IW29 to check the time taken from lodging a complaint to actual replacement

of pipelines.

3. Check the number of cases of leakage and financial loss suffered due to it.

4. Use T-Code MB52, MB5B, MMBE to check whether spares are issued on FIFO basis and no new

spare has been purchased which was already present in store.

29.TA.28 Operations - Breakdown analysis Control Objective No downtime or breakdown Nature of Work Step Analysis/Verification Risk Operational delays. Nature of Control Automated/Manual

1. Use T-Code IW39 to check the total number of hours of downtime.

2. Check the action taken to avoid frequent breakdowns.

29.TA.29 Operations - Safety Control Objective Availability of protective devices, strict adherence to safety measures Nature of Work Step Verification Risk Non- Compliance to Safety Procedures and Guidelines. Nature of Control Automated/Manual


2. Use T-Code IE03, IH08 to check whether safety devices are kept for maintenance people and

no one is allowed entry without them.



Audit Checklist

453



29.TA.30 Operations - Training to workers Control Objective Providing on site and off site training Nature of Work Step Verification Risk Untrained employees may lead to delay in completion of projects/






29.TA.31 Operations - Statutory compliances Control Objective To ensure compliance to various statutory requirements Nature of Work Step Verification Risk Statutory non-compliance Nature of Control Manual


complying the same.




29.TA.32 Operations - Tools, spares and other expenses Control Objective To ensure adequate controls over expenses Nature of Work Step Verification Risk Inadequate control over expenses. Nature of Control Automated/Manual







29.TA.33 Operations - HSE compliances Control Objective Compliance with HSE laws Nature of Work Step Verification Risk Non-compliance to HSE Laws. Nature of Control Automated/Manual


2. Use T-Code S_SH8_72000002 to check that health of workers is not compromised on any

count.



Audit Checklist

454

29.TA.34 Installations - SOP compliance Control Objective Compliance of SOP Nature of Work Step Analysis/Verification Risk 1. Non-compliance to SOP.


1. Check that company has a well defined SOP for servicing.




29.TA.35.1 Installations - Operations Control Objective Collection of Gas Nature of Work Step Analysis/Verification Risk Leakage of gas. Nature of Control Automated/Manual

1. Use T-Code MCPD to verify if the daily production reports are being maintained on regular

basis for the wells.

2. Verify if production targets are planned and the details communicated to the respective GCS.

3. Use T-Code S_ALR_87013142, S_ALR_87013143 to verify actual production meets planned

targets on daily/monthly/quarterly/annual basis.

29.TA.35.2 Installations - Operations Control Objective Pumping to Customer Nature of Work Step Analysis/Verification Risk Leakage of gas. Nature of Control Automated/Manual

1. Use T-Code VL06C to verify if gas is pumped to the customers as per the agreed time schedule

/ MOU.

2. Use T-Code QC31 to verify that the gas intake certificate is obtained from the customer.

3. Verify that product reconciliation is regularly carried out with customers.

29.TA.35.3 Installations - Operations Control Objective Other operations Nature of Work Step Analysis/Verification Risk Leakage of gas. Nature of Control Automated/Manual

1. Use T-Code IK07, IK17, S_ALR_87013421 to verify that gas received at the gas compression

plant is compressed to required pressure.

2. Verify that the LPG plant extracts LPG from the gas supplied to it.

3. Verify the availability of the agreed upon custody transfer procedures in customer agreements.

4. Check if calibration of custody transfer meters are done in presence of customer

representative.

29.TA.36 Installations - Safety Control Objective Availability of protective devices, strict adherence to safety measures Nature of Work Step Verification Risk Non- Compliance to safety procedures and guidelines.

Audit Checklist

455

Nature of Control Automated/Manual 1. Use T-Code IP24 to check the maintenance service schedule.

2. Use T-Code IE03, IH08 to check whether safety devices are kept for maintenance people and

no one is allowed entry without them.





29.TA.37 Installations - Testing of flow lines Control Objective Ensure effectiveness of testing procedures Nature of Work Step Analysis/Verification Risk Leakage of gas. Nature of Control Automated/Manual

1. Use T-Code QP08 to verify if that inspection plans exist for maintenance of flow lines and lines

are regularly tested and inspected for damage or blockages.

2. Use T-Code IP24, IW23, IW39 to verify if maintenance of feeder and collector lines is done by

designated personnel.

3. Verify losses during transmission in the feeder lines.

29.TA.38Installations - Equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Analysis/Verification Risk Decreased life of equipment. Nature of Control Automated/Manual


reviewed regularly.














Audit Checklist

456

29.TA.39 Installations - Maintenance Control Objective Timely closure of maintenance requests to avoid operational delays Nature of Work Step Analysis/Verification Risk Operational delays Nature of Control Automated/Manual


any.



4. In case of manual request, check the process of recording and monitoring the requests

received.


request.



29.TA.40 Installations - ITF Control Objective ITF Nature of Work Step Verification Risk 1. Supply of oil not as per standards defined

2. Delay in supply Nature of Control Manual

1. Use transaction code MCXB, MCXD to check that oil is transferred to pumps only after the

sample sent to laboratory for analysis is found to be acceptable.

2. To check that formation water at all installations is disposed as per standards.

3. Use transaction code VL04 to check that dispatch of crude oil is not delayed by more than 24

hours then BS&W content increases.

4. Use transaction code IP24, IW23, IW39 to check that NDT (Non-destructive test) is done

frequently to avoid corrosion of tanks.

5. To check that oil is collected at ITF, before pumping to pipeline, to improve the quality (BS & W

content) of the oil.

29.TA.41 Water Injection Control Objective Effective implementation of activities Nature of Work Step Verification Risk Non-Monitoring may lead to delay in implementation or ineffective


1. To check that there are no procedural delays

2. To verify pilferage / losses of water during transmission

3. Use transaction code IP23 to check if inspection plans exist for maintenance of flow lines and

lines are regularly tested and inspected for damage or blockages.

4. To verify if there is surveillance, servicing, inspection of flow lines

5. To verify onshore operations team has a water injection plan and if the same has been

communicated to the WIP In charge.

6. Use transaction code MCXB, MCXD To verify that water to be pumped into the well is properly

treated prior to pumping

7. Use transaction code CO09 To verify availability of potable water

Audit Checklist

457

8. To verify that the equipment in use are appropriate in terms of present technology and new

technology is proposed on the basis of cost-benefit analysis.

9. To verify availability of chemicals & consumables while conducting operations

10. Use transaction code COOIS to verify that the demulsifying agents being used in the process are

of the right quality and have been quality checked prior to usage.

11. To verify losses during transmission in the feeder lines.

12. Use transaction code MCXB, MCXD to verify whether water is treated properly before its

discharge into sea water.

13. Use KSBL to check that planning on new water injection stations is done in advance.

29.TA.42 Utility Control Objective Effective implementation of activities Nature of Work Step Verification Risk Non-Monitoring may lead to delay in implementation or ineffective


1. Use MD04 To ensure that there are sufficient vehicles to supply steam

2. To ensure that appropriate licenses are obtained to run BB / Mobile vans

29.TA.43 WSS - Well stimulation services Control Objective Effective implementation of activities Nature of Work Step Verification Risk Non-Monitoring may lead to delay in implementation or ineffective


1. To verify that the WSS work is carried out in a systematic and scientific way.

2. To verify that the choice of the stimulation technique and capacity of the equipment to enable

the job is the best in given circumstances

3. To ensure there is compliance to the safety requirement

4. To verify that there is minimum time lag between receiving of an indent from project personnel

and actual start of WSS

5. To verify that there exist a seamless coordination between different departments for effectively

performing the WSS jobs.

6. To verify that there is an inbuilt system to enable constant monitoring of the performance of

WSS.

7. To verify that the services to third parties is undertaken without affecting the in-house

requirement

8. Use CO09 to verify availability of consumables/stores while conducting operations.

9. Use MCXB, MCXD to verify that consumables/stores used in operations is of good quality and as

per the need of the operation being conducted.

10. To verify that adequate insurance is obtained wherever necessary to cover risks.

11. To check that there is no loss of tool string inside the well bore

12. To ensure that no logistics issues emerge

13. Use MB52 To ensure there is no shortage of nitrogen or critical spares

14. Use VL06O To check that there are no delays in deployment of the vehicles

Audit Checklist

458

29.TA.44 WSS - Work over operation Control Objective Effective utilization and increased life of the equipment Nature of Work Step Analysis/Verification Risk Inefficient utilization of equipment Nature of Control Automatic/Manual

1. To check if down hole information is available before the start of work over

2. Use transaction code IE03 To check that surface and sub-surface equipment is available.

3. To check for the condition of surface production facilities

Audit Checklist

459

30. Production Projects – Technical Audit

Scope Audit Areas

1 Preparation of surface plan / layout

2 Preparation of detailed equipment layout & piping drawings


4 Statutory clearances and compliance

5 Equipment & materials design & procurement

6 Contractor / Vendor

7 Contract procedures


9 Project implementation/ Project execution

10 Commissioning




14 PR tracking



Audit Checklist

460

30.TA.1 Preparation of surface plan / layout

Control Objective Adequate planning, Accuracy in making the surface Layout, appropriate approvals, inputs from user department


2. Non compliance to DOP. Nature of Control Manual

1. Check whether surface plan / layout is prepared for a production project activities.

2. Check whether such surface plan / layout is reviewed and approved as per the DOP.

3. Check whether such surface plan / layout is monitored on regular basis and changes, if any are

made after obtaining approvals as per DOP.

4. Check whether provisions of additional space are made considering statutory requirements for

any future expansion.

5. Check whether the adequate contractor selection evaluations are carried out before selection

and awarding of contract.

6. Ensure that alteration to project plan/design during and after the installation is not very

frequent as it results in impacting cost, time and effectiveness of the project.

7. Check whether user department's feedback is obtained before finalization of surface plan /

layout.

30.TA.2 Preparation of detailed equipment layout & piping drawings Control Objective Adequate planning, Avoiding any reconstruction cost Nature of Work Step Analysis/Verification Risk 1. Inappropriate approvals.


3. Cost Over runs. Nature of Control Automated/Manual

1. Use T-Code IH08 to check whether detailed equipment layout & piping drawings are prepared

and list of equipment, instruments, fittings etc. to be used are identified.

2. Use T-Code IE03, IH08 to display equipment details to ensure correct specifications are given for

equipment.

3. Check whether such equipment layout plan & piping drawings are reviewed and approved as

per the DOP.

4. Check whether any changes made in equipment layout plan & piping drawings are approved as

per the DOP.

5. Check whether user department's feedback is obtained before finalization of detailed

equipment layout & piping drawings etc.

Audit Checklist

461

30.TA.3 Environment, Health and Safety Compliance Control Objective Safeguarding interest of Company / employees / public / environment Nature of Work Step Analysis/Verification Risk Non- Compliance to HSE laws. Nature of Control Manual

1. Check whether there is a compliance framework related to statutory requirement for EH&S.

2. Check whether EH&S compliance framework is monitored and reviewed on regular basis.


4. Check whether required documents/report/returns are filed on monthly/ quarterly/ annually

basis to Govt./State Govt. authorities.

5. Check whether necessary approvals/clearances (e.g. DGMS, MOEF) were obtained before start

of construction activities.

30.TA.4 Equipment & materials design & procurement Control Objective Adequate planning, efficient utilization and increased life of the equipment Nature of Work Step Analysis/Verification Risk 1. Inappropriate approvals.


3. Inefficient utilization of equipment. Nature of Control Automated/Manual

1. Use T-Code KSBL to display plan and check whether the plan of Production project department

is complete and all-inclusive for man, materials, equipment.

2. To ensure timely procurement/ ordering.

3. Use T-Code KSBL to check whether such plan is approved by competent authority as per DOP.

4. Use T-Code KSBL to check whether any amendments in such plan is approved by competent


5. Use T-Code S_ALR_87013532 to view actual vs. budget analysis and check whether actual

expenses are monitored / compared with planned expenses on periodic basis against such plan.

6. Use T-Code IE03, IH08 to view equipment characteristics and check whether equipment used

for are in line with crude characteristics & Operating Conditions or to check whether equipment

are allocated as per project requirement.

7. Use T-Code IK17 and enter the equipment code to check whether the utilization of equipment is

reviewed regularly.

8. Use T-Code IP24 and enter equipment number to check whether there is a maintenance

schedule (preventive/regular) for equipment and its compliance.

9. Use T-Code IP24, IW33/IW39 to display the PM orders and check whether monitoring over turn-

around time as per schedule and actual time taken for maintenance of equipment is done.

10. Use T-Code IW33 and enter equipment number and check whether the equipment are

calibrated regularly.

11. Check whether monitoring is done for compliance to OEM guidelines for operating equipment.

30.TA.5 Issuance of materials/spares items Control Objective Avoiding stock out situation, adequate approvals for issuance, inventory

controls Nature of Work Step Analysis/Verification Risk 1. Stock-out situation.

Audit Checklist

462

2. Inadequate approvals as per DOP. Nature of Control Automated/Manual

1. Use T-Code MB52 to view stock on posting date, MMBE to view stock overview, MB5B to view

stocks at various warehouses and ensure whether inventory levels of materials/spares items are

monitored and for materials below threshold levels and the required PR has been raised.

2. To conduct a walkthrough of the issuance process of materials/spares items from stores and

identify gaps.

3. Use T-Code MB5B, MB52 to check whether approvals for issue of materials/spares items are

taken as per DOP.

4. Use T-Code MC46 to view the slow moving items and ensure whether there is a process for

monitoring over obsolete / slow / nonmoving / materials or spares and appropriate decisions

are taken for the same.

30.TA.6.1 Project implementation/ Project execution Control Objective Adequate monitoring over execution, timely completion of execution,

Reducing mobilization time of contractor Nature of Work Step Analysis/Verification Risk 1. Inadequate monitoring leading to cost overrun.

2. Delay in execution.

3. Low quality of deliverable. Nature of Control Automated/Manual

1. Use T-Code CJ20N to check whether project activity chart/project execution schedule is

prepared and its compliance is ensured.

2. Use T-Code S_ALR_87015124, S_ALR_87015125 to check whether progress report is prepared

and shared with the concerned stakeholders on a regular basis.

3. Use T-Code S_ALR_87015124, S_ALR_87015125 to check whether quality inspection of project

executed is performed as per laid down procedures/contract.

4. Use T-Code S_ALR_87015124, S_ALR_87015125 to check whether project execution is

performed as per agreed terms and conditions of contract agreed with the contractor.

5. Check whether contract was awarded to the contractor within a reasonable time.

6. Use T-Code MB52 to check that there is adequate stock of materials and supplies to avert

material shortage.

7. Use T-Code ME4S to view service sheet dump for the audit period to check the delivery of the

services by the contractor.

8. Check whether project is executed as per approved surface plan / layout and detailed

equipment layout & pipeline drawings etc.

9. Check whether approvals as per DOP are obtained if project is executed with some change in

approved surface plan / layout and detailed equipment layout & pipeline drawings etc.

Audit Checklist

463

30.TA.6.2 Project implementation/ Project execution Control Objective Locality/ Public Problems Nature of Work Step Verification Risk Operational delays. Nature of Control Manual

1. Check whether there is liaison with local public and initiatives are taken to maintain cordial

relations.

2. Check CSR activities are performed in relation to the project as per company policies and

decisions time to time.

30.TA.6.3 Project implementation/ Project execution Control Objective Cost and Time Overruns Nature of Work Step Analysis / Verification Risk 1. Cost Overrun.


1. Use T-Code CJ20N to check whether adequate Man, Material, Equipment is deployed by

contractor as per contract. Also check whether there is adequate monitoring done by Oil on the

same.

2. Use T-Code CJ20N to check whether there is levying of LD etc. as per Contract Clause.

3. Check whether there is adequate project planning and monitoring to avert cost and time

overruns.

4. Use T-Code CJ20N to check whether the time overruns are due to delays in obtaining the

required approvals.

5. Use T-Code MB52 and CJ20N to check whether time overruns are due to delays in material

availability and ineffective monitoring of project.

30.TA.6.4 Project implementation/ Project execution Control Objective Cost recovery Nature of Work Step Analysis / Verification Risk Inadequate cost recovery. Nature of Control Automated/Manual

1. Use T-Code S_ALR_87013562 to check whether there is effective project monitoring for

execution of turnkey project.

2. Check if the material/services supplied by the Company for the Turnkey projects are adequately

and timely recovered.

30.TA.6.5 Project implementation/ Project execution Control Objective Insurance claim

Nature of Work Step Verification Risk Delay in insurance claims. Settlement for all type of insured losses. Nature of Control Manual

1. Check whether there is any delay in filing the insurance claims and ensuring timely settlement.

2. Check whether insurance claim is filed for all material lost/damaged/stolen and third party

claims.

Audit Checklist

464

30.TA.6.6 Project implementation/ Project execution Control Objective Project management

Nature of Work Step Verification Risk Weak project management may lead to cost and time over runs. Nature of Control Manual

1. Check whether Governance and escalation framework are defined to ensure that there is not

weak control over project execution and management.

30.TA.7.1 Commissioning Control Objective Avoid defects and faulty work

Nature of Work Step Analysis / Verification Risk Defects and faults in work completed. Nature of Control Automated/Manual

1. Use T-Code CJ20N and enter WBS code to view project details to check whether there is

adequate testing, inspection & monitoring.

2. Use T-Code CJ20N to check whether there is deduction for faulty work as per contract clause.

3. Check the adequacy of process of issuing commissioning certificate.

30.TA.7.2 Commissioning Control Objective Avoid equipment Failure

Nature of Work Step Analysis / Verification Risk Equipment failure. Nature of Control Automated/Manual

1. Use T-Code CJ20N to check whether proper inspection of equipment is carried out.

2. Use T-Code CJ20N to check whether Hydro testing is done prior to commissioning of equipment

and pipelines.

3. Use T-Code MB52 to check whether adequate spares including warranty spares and supplies are

maintained.

4. Use T-Code IE03 to view equipment details to check whether there is warranty provided by

equipment supplier.

30.TA.8 Handing over of project Control Objective Timely handing over of project, documentation, certifications etc.

Nature of Work Step Analysis / Verification Risk 1. Delay in completion.

2. Cost over-run. Nature of Control Automated/Manual

1. Check whether a certification of commissioning is obtained from the concerned department/

contractor.

2. Check whether user department clearance is obtained for project handing over.

3. Use T-Code CJ20N to check whether completion report is prepared for the project and the same

is documented and reviewed.

4. Use T-Code CJ20N to check whether there is adequate testing / inspection at the time of

handing over of project.

5. Use T-Code CJ20N to check whether project work is handed over as per schedule and reasons

are documented and approved in case of delay.

Audit Checklist

465

30.TA.9.1 Monitoring framework Control Objective Quality of execution.

Nature of Work Step Analysis / Verification Risk Low quality work. Nature of Control Automated/Manual

1. Use T-Code MCXB and MCXD to view quality results to check whether there are adequate

specifications, good quality material and monitoring to ensure that quality of execution is good.

2. Use T-Code CJ20N to check whether the reporting is correct and there is adequate process of

recording and monitoring of project expenditure.

30.TA.9.2 Monitoring framework Control Objective Reducing financial loss

Nature of Work Step Analysis / Verification Risk Financial Loss. Nature of Control Automated/Manual

1. Use T-Code CJ20N to check whether there are adequate controls on project material

accounting, recording, reconciliation and monitoring.

30.TA.9.3 Monitoring framework Control Objective Material Reconciliation

Nature of Work Step Analysis / Verification Risk Pilferage of materials. Nature of Control Automated/Manual

1. Use T-Code CJ20N to check whether there is before start and after completion monitoring.

2. Check whether material reconciliations are prepared and monitored on timely basis to identify

any material losses.

30.TA.9.4 Monitoring framework Control Objective HSE

Nature of Work Step Verification Risk Non-Compliance to HSE laws. Nature of Control Manual

1. Check whether there is monitoring of HSE compliance by contractors / internal staff during

execution.







Audit Checklist

466



delays.

Audit Checklist

467

31. Projects – Technical Audit

Scope Audit Areas


2 Statutory approvals


4 Contracting

5 Project Implementation/ Project Execution

6 Commissioning




10 PR tracking



Audit Checklist

468

31.TA.1.1 Project Implementation/ Project Execution Control Objective Adequate monitoring over execution, timely completion of execution,

Reducing mobilization time of contractor Nature of Work Step Analysis / Verification Risk 1. Inadequate monitoring leading to cost overrun.

2. Delay in execution.

3. Low quality of deliverable. Nature of Control Automated / Manual

1. Use T-Code CJ20N to check whether project activity chart/project execution schedule is

prepared and its compliance is ensured.

2. Use T-Code S_ALR_87015124, S_ALR_87015125 to check whether progress report is prepared

and shared with the concerned stakeholders on a regular basis.

3. Use T-Code S_ALR_87015124, S_ALR_87015125 to check whether quality inspection of project

executed is performed as per laid down procedures/contract.

4. Use T-Code S_ALR_87015124, S_ALR_87015125 to check whether project execution is

performed as per agreed terms and conditions of contract agreed with the contractor.

5. To check whether contract was awarded to the contractor within a reasonable time.

6. Use T-Code MB52 to check that there is adequate stock of materials and supplies to avert

material shortage.

7. Use T-Code ME4S to view service sheet dump for the audit period to check the delivery of the

services by the contractor.

8. To check whether project is executed as per approved surface plan / layout and detailed

equipment layout & pipeline drawings etc.

9. To check whether approvals as per DOP are obtained if project is executed with some change in

approved surface plan / layout and detailed equipment layout & pipeline drawings etc.

31.TA.1.2 Project Implementation/ Project Execution Control Objective Locality/ Public Problems Nature of Work Step Verification Risk Operational delays. Nature of Control Manual

1. To check whether there is liaison with local public and initiatives are taken to maintain cordial

relations.

2. To check CSR activities are performed in relation to the project as per company policies and

decisions time to time.

Audit Checklist

469

31.TA.1.3 Project Implementation/ Project Execution Control Objective Cost and Time Overruns Nature of Work Step Analysis / Verification Risk 1. Cost overrun.


1. Use T-Code CJ20N to check whether adequate Man, Material, Equipment is deployed by

contractor as per contract. Also check whether there is adequate monitoring done by Oil on the

same.

2. Use T-Code CJ20N to check whether there is levying of LD etc. as per Contract Clause.

3. Check whether there is adequate project planning and monitoring to avert cost and time

overruns.

4. Use T-Code CJ20N to check whether the time overruns are due to delays in obtaining the

required approvals.

5. Use T-Code MB52 and CJ20N to check whether time overruns are due to delays in material

availability and ineffective monitoring of project.

31.TA.1.4 Project Implementation/ Project Execution Control Objective Cost recovery Nature of Work Step Analysis / Verification Risk Inadequate cost recovery. Nature of Control Automated/Manual

1. Use T-Code S_ALR_87013562 to check whether there is effective project monitoring for

execution of turnkey project.

2. To check if the material/services supplied by the Company for the turnkey projects are

adequately and timely recovered.

31.TA.1.5 Project Implementation/ Project Execution Control Objective Insurance claim Nature of Work Step Verification Risk Delay in insurance claims and settlement for all type of insured losses. Nature of Control Manual

1. Check whether there is any delay in filing the insurance claims and ensuring timely settlement.

2. Check whether insurance claim is filed for all material lost/damaged/stolen and third party

claims.

31.TA.1.6 Project Implementation/ Project Execution Control Objective Project management Nature of Work Step Verification Risk Weak project management may lead to cost and time over runs. Nature of Control Manual

1. Check whether Governance and escalation framework are defined to ensure that there is not

weak control over project execution and management.

Audit Checklist

470

31.TA.2.1 Commissioning Control Objective Avoid defects and faulty work Nature of Work Step Analysis/Verification Risk Defects and faults in work completed. Nature of Control Automated/Manual

1. Use T-Code CJ20N and enter WBS code to view project details to check whether there is

adequate testing, inspection & monitoring.

2. Use T-Code CJ20N to check whether there is deduction for faulty work as per contract clause.

3. Check the adequacy of process of issuing commissioning certificate.

31.TA.2.2 Commissioning Control Objective Avoid equipment Failure Nature of Work Step Analysis/Verification Risk Equipment Failure. Nature of Control Automated/Manual

1. Use T-Code CJ20N to check whether proper inspection of equipment is carried out.

2. Use T-Code CJ20N to check whether Hydro testing is done prior to commissioning of equipment

and pipelines.

3. Use T-Code MB52 to check whether adequate spares including warranty spares and supplies are

maintained.

4. Use T-Code IE03 to view equipment details to check whether there is warranty provided by

equipment supplier.

31.TA.3 Handing over of project Control Objective Timely handing over of project, documentation, certifications etc. Nature of Work Step Analysis/Verification Risk 1. Delay in completion.

2. Cost overrun. Nature of Control Automated/Manual

1. Check whether a certification of commissioning is obtained from the concerned department/

contractor.

2. Check whether user department clearance is obtained for project handing over.

3. Use T-Code CJ20N to check whether completion report is prepared for the project and the same

is documented and reviewed.

4. Use T-Code CJ20N to check whether there is adequate testing / inspection at the time of

handing over of project.

5. Use T-Code CJ20N to check whether project work is handed over as per schedule and reasons

are documented and approved in case of delay.

31.TA.4.1 Monitoring framework Control Objective Quality of execution Nature of Work Step Analysis/Verification Risk Low quality work. Nature of Control Automated/Manual

1. Use T-Code MCXB and MCXD to view quality results to check whether there are adequate

specifications, good quality material and monitoring to ensure that quality of execution is good.

2. Use T-Code CJ20N to check whether the reporting is correct and there is adequate process of

recording and monitoring of project expenditure.

Audit Checklist

471

31.TA.4.2 Monitoring framework Control Objective Reducing financial loss Nature of Work Step Analysis/Verification Risk Financial Loss. Nature of Control Automated/Manual

1. Use T-Code CJ20N to check whether there are adequate controls on project material

accounting, recording, reconciliation and monitoring.

31.TA.4.3 Monitoring framework Control Objective Material Reconciliation Nature of Work Step Analysis/Verification Risk Pilferage of materials. Nature of Control Automated/Manual

1. Use T-Code CJ20N to check whether there is before start and after completion monitoring.

2. To check whether material reconciliations are prepared and monitored on timely basis to

identify any material losses.

31.TA.4.4 Monitoring framework Control Objective HSE Nature of Work Step Verification Risk Non-Compliance to HSE laws. Nature of Control Manual

1. Check whether there is monitoring of HSE compliance by contractors / internal staff during

execution.





Audit Checklist

472

33. Research Development – Technical Audit

Scope Audit Scope

1 SOP Compliance

2 R&D budget

3 R&D activities

4 Procurement and AMC contracts

5 Testing & Inventory management


7 Statutory Requirements

8 Confidentiality

9 PR tracking



Audit Checklist

473

33.TA.1 SOP Compliance Control Objective Compliance of SOP

Nature of Work Step Analysis Risk Non compliance to SOP and internal policy may lead incorrect

practices.

Nature of Control Manual 1. Check that company has a well-defined SOP for R&D activities.

2. To check that all process are being followed as per SOP.

3. To check any deviation from SOP and document the reason given for same. Analyze its

reasonability and quote.


33.TA.2 R&D budget Control Objective Adequate monitoring and approval of budgets

Nature of Work Step Analysis / Verification Risk 1. Inappropriate approvals.

2. Non monitoring of budget.

Nature of Control Automated/Manual 1. Use T-Code KSBL to Check the approvals over budget sanctioned for research and development

work as per DOP.

2. Use of T-Code KSBL to Check whether any revision were initiated during the period of the

budget. Check for the approvals from the authorized personnel as per DOP.

3. Use of T-Code - S_ALR_87013557 to analyze the actual vs. budgeted expenditure for research

and Development work. In case of any variation, check the deviation / exceptional approvals

from authorized personnel as per DOP.

4. Use of T-Code - CJ20N to check if R&D expenditure is spent as per the mandatory requirements.

5. Check if the reason of short/ excess expenditure are documented and approved.

6. Check if action plan is prepared to avoid deviations in future.

33.TA.2.1 R&D activities Control Objective Continuous R&D to support efficient operations

Nature of Work Step Analysis / Verification Risk Due to lack of R&D support it may hamper the overall operations which

may lead to loss.

Nature of Control Automated/Manual 1. Use of T-Code - KSBL to check the approvals and clearances for annual plans as per DOP.

2. Use of T-Code - KSBL to check if R&D activities are planned in advance considering the changing

needs and requirements of the business.

3. Check if the process exist for tracking of user requests for R&D and action plan formulated by

R&D to address those requests.

4. Use of T-Code - KSBL to check the status of the targets met against the annual plans formulated.

5. Use of T-Code - KSBL to check whether revisions in the annual plans were initiated considering

the changing business requirements.

6. Identify the R&D work obsoleted till date. Conduct the root cause analysis for obsoleting the

work done.

Audit Checklist

474

33.TA.3 Procurement and AMC contracts Control Objective Technologically upgraded, Cost effectiveness, Timely procurement of

lab equipment’s, Annual Maintenance of lab equipment

Nature of Work Step Analysis / Verification Risk 1. Delay in procurement may hamper the operations.

2. Lack of AMC can result break down of equipment which hamper

operations.

Nature of Control Automated/Manual 1. Use of T-Code - ME5A, ME2J, ME2S to extract the report and to check if all the procurement is

done in accordance to the procurement policy.

2. Check whether latest technology and developments are considered for procurement of

equipment.

3. Use of T-Code - MB52 to check the timelines for the receipt of the scheduled delivery /delivered

lab equipment.

4. Use of T-Code - ML95 to extract the report and to check the maintenance of a list of AMC

contracts in chronological order. Check the timely renewal of the AMC contracts.

5. Use of T-Code - ML95 to check the periodicity of AMC services provided and follow ups

conducted with the vendors.

33. TA.4 Issuance of materials/spares items Control Objective Avoiding stock out situation, adequate approvals for issuance,

inventory controls Nature of Work Step Analysis / Verification Risk 1. Stock-out situation.

2. Inadequate approvals as per DOP. Nature of Control Automated/Manual

1. Use T-Code MB52 to view stock on posting date, MMBE to view stock overview, MB5B to view

stocks at various warehouses and ensure whether inventory levels of materials/spares items are

monitored and for materials below threshold levels, the PR has been raised.


identify gaps.

3. Use T-Code MB5B, MB52 to check whether approvals for issue of materials/spares items are

taken as per DOP.

4. Use T-Code MC46 to view the slow moving items and ensure whether there is a process for

monitoring over obsolete / slow / nonmoving / materials or spares and appropriate decisions

are taken for the same.

33. TA.5 Statutory Requirements Control Objective Compliance with the Statutory Guidelines. Nature of Work Step Verification Risk Statutory Non-compliance. Nature of Control Manual

1. Check if the required approvals and clearances are obtained and renewed on timely basis for

carrying out the R&D activities.

2. Check if the tracking mechanism is in place to ensure timely renewal of all approvals.

3. Check if Central Pollution Control Board (CPCB) guidelines are monitored and followed. T-Code -

S_SH8_72000033.

Audit Checklist

475

33. TA.6 Confidentiality Control Objective Avoid leakage of confidential information. Nature of Work Step Verification Risk Possibility of sharing confidential information. Nature of Control Manual

1. Check if the critical and confidential R&D information/ documents are identified.

2. Check if the physical copies of the confidential information is stored in lock in key with access to

authorized person only.

3. Check if critical R&D data maintained in soft form is stored in encrypted form and access is

provided to authorized person only.

33. TA.7Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material/services Nature of Work Step Verification Risk 1. Delays in payments.








delays.

33. TA.8Manpower planning Control Objective To ensure manpower is adequate for all the departmental activities Nature of Work Step Verification/Analysis Risk 1. Over/Under Utilization of manpower.




Audit Checklist

476

34. Safety Environment – Technical Audit

Scope Audit Areas


2 Training of Employees

3 Periodic Audits & Inspections

4 Statutory Clearances and permission

5 Disposal of waste, Hazardous chemicals and other by products

6 PR Tracking


8 Manpower Planning

9 Fire Safety Plan

10 Fire Safety training

11 Fire fighting Equipments testing

12 Incident Management

13 Procurement of Fire safety equipments

Audit Checklist

477

34. TA.1 HSE - Compliances with HSE standards Control Objective Checklist of HSE norms, compliances of same on time Nature of Work Step Verification Risk Non Compliance to HSE Norms. Nature of Control Manual

1. To check if the comprehensive checklist of various HSE compliances is maintained.

2. To check if there exist approved HSE/ Safety policy and employees are aware of the same.

3. To check if the checklist of compliances is monitored and updated on continuous basis.

4. To check if there exists the mechanism of ensuring the compliances to all statutory

requirements (including but not limited to) :

a. Mines Act

b. Oils and Mines regulations

c. Explosive Act and Rules

d. OISD standards.

e. Environment protection Act

f. Water & Air Act.

g. Water cess Act

h. Hazardous waste management Act

i. E. Waste

j. Petroleum Act.

k. Explosive Act and rules etc.

5. To check if the action plan is documented and adhered for the identified non compliances.

6. To check if various statutory reports and MIS are correctly prepared.

7. To check if various statutory reports and MIS are submitted timely to various statutory

authorities.

34. TA.2HSE - Training of Employees Control Objective Employees are trained, aware of the safety equipment's, zero accidents Nature of Work Step Verification Risk Employee accidents and dissatisfaction. Nature of Control Manual

1. To check whether employees are trained for compliance to safety requirements.

2. To check accidents due to lack of training maintenance of equipment.

3. To check the number of accidents occurred during the year and the reasons for same are

documented and analyzed for not repeating in future.

4. To check whether any personal injury was caused due to lack of proper training.

5. To check whether any loss to asset was made due to improper training.

6. To check whether all the statutory training required under any act are planned and conducted.

7. To check control measures adapted to control any incident in future.

8. Ensure that the employees on field duty are provided with Personal Protection Equipment

(PPE).

Audit Checklist

478

34.TA.3 HSE - Periodic Audits & Inspections Control Objective Pollution complaints, statutory penalties and other environmental losses Nature of Work Step Verification Risk 1. Non-performance of periodic audits.

2. Legal problems. Nature of Control Manual

1. To check if any complaint has been registered against the company for causing pollution of any


2. To check whether adequate steps are taken by company against the complaints filed against the

Company.

3. To check whether periodic audits regarding environment safety has been conducted and the

observations of such audits.

4. To check whether periodic inspection has been conducted internally and results are monitored.

5. To check if checklist / manual of compliances is updated with the deviations noted during

various audits.

34.TA.4 HSE - Statutory Clearances and permission Control Objective Availability of all Statutory Clearances and permission Nature of Work Step Verification Risk Non-compliance to Statutory norms/permissions. Nature of Control Manual

1. To check if the tracker is maintained to monitor the clearances to be obtained by the

department.

2. To check if all the required clearances have been obtained by the department.

3. To check if there exists a checklist of the documents required to be filed for the required

clearances.

4. To check if there is adequate follow up done to ensure time receipt of all clearances.

5. To check if the renewal process is started in timely basis for the clearances nearing expiry.

34.TA.5 HSE - Disposal of waste, Hazardous chemicals and other by products Control Objective Disposal of waste, Hazardous chemicals and other by products as per

statutory requirements Nature of Work Step Verification Risk Inappropriate disposal of hazardous waste leading to legal problems. Nature of Control Manual

1. To check that company has a well defined disposal plan for disposal of hazardous waste.

2. To check that waste is processed before disposition so as to cause minimum damage.

3. To check compliance with ISO manual for water and air pollution.

4. To check whether a disposal is done as per the statutory requirements and guidelines

prescribed for disposal.

5. To check whether company has obtained all required certificate and clearances for disposal.

6. Check whether the invoicing of sale is as per the contract and revenue is recognized properly.

Audit Checklist

479

34.TA.6 HSE - Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material/services Nature of Work Step Verification Risk 1. Delays in payments.








delays.

34.TA.7 Fire Safety Department - Fire Safety Plan Control Objective Availability of fire safety plan and its display indicating the emergency

fire exits. Nature of Work Step Verification Risk Unavailability of fire safety plan. Nature of Control Manual

1. To check that company has a well defined fire safety plan in line with ISO policies.

2. To check that safety plan has been placed near the exits.

3. To check that fire exits are available and clearly indicated in the Company.

4. To check all statutory compliances have been complied like placing of fire extinguishers at

reasonable distances.

34.TA.8 Fire Safety Department - Fire Safety training Control Objective Register of training provided, occasional drills and awareness program. Nature of Work Step Verification Risk Lack of Fire Safety Training. Nature of Control Manual

1. To check that security guards are provided with regular training for being equipped with fire

fighting instruments.

2. To check that employees are provided with training and mock drills are conducted. Check that

dates of such drills are recorded in the register.

3. To check that employees are aware of the fire safety plan and fire exits.

Audit Checklist

480

34.TA.9 Fire Safety Department - Firefighting Equipment testing Control Objective Refilling of fire fighters, availability in critical areas Nature of Work Step Verification Risk Malfunctioning/ unavailability of fire fighting equipment. Nature of Control Manual

1. To check whether management has identified critical areas for fire like near the machinery.

2. To check that fire fighters are available in risk areas.

3. To check if there exist a mechanism to ensure upkeep of fire safety equipment.

4. To check that fire fighters are not expired and water pressure is maintained in water gauges.

34.TA.10 Fire Safety Department - Incident Management Control Objective Timely action to minimize loss Nature of Work Step Verification Risk Delay in minimizing loss. Nature of Control Manual

1. To check if there is a mechanism of recording all fire complaints.

2. To check if the action is taken on timely basis for all reported incidents.

3. To check if root cause analysis if done and action plan documented for past failures (if any).

4. To check if adequate documentation is maintained for all the incidents included the statutory

requirements for the same.

Audit Checklist

481

36. Transport – Technical Audit

Scope Audit Areas



3 Deployment of vehicles

4 Passenger vehicle

5 Inspection


7 Health, Safety & Environment

8 Maintenance


10 PR tracking



Audit Checklist

482

36.TA.1 Inspection Control Objective Statutory Compliance, Complete documentation

Nature of Work Step Analysis/Verification Risk 1. Non-Compliance to statutory framework.

2. Inadequate documentation.

Nature of Control Manual 1. To check whether there is a process of monitoring contractual compliance w.r.t. hired vehicles.

2. To check whether all the documents w.r.t statutory compliance e.g. insurance, driver's license,

pollution check etc. are checked regularly.

3. To check whether there is a database of monitoring all the above mentioned details.

4. To check whether Company initiates reminder process in case, the expiry/renewal date for

license/pollution check/insurance etc. is approaching.

5. For hired manpower, check whether the Company checks the ESI and PF payment made by the

contractor.

36.TA.2 Certification of bills of vendor Control Objective Authorized and appropriate payment, No duplicity payments

Nature of Work Step Analysis/Verification Risk Unauthorized payments.

Nature of Control Automated/Manual 1. Conduct a walkthrough of certification of bills of vendor.

2. To check whether vendor's invoices are paid only after proper supporting have been verified

and approval is taken as per DOP. Use T-Codes FBL1N, MIR4.


invoice, if applicable. Use T-Codes FBL1N, MIR4.

4. To check that there is no over payment/ duplicate payment/ unauthorized payment to the

vendors. Use T-Codes FBL1N.

5. To check that there is correct certification of contractor bills. Use T-Codes FBL1N, MIR4.

6. To check whether payment is made only against liability created in SAP. Use T-Codes FBL1N,

MIR4.

36.TA.3.1 Maintenance Control Objective Timely closure of maintenance requests to avoid operational delays

Nature of Work Step Analysis/Verification Risk Operational risk.

Nature of Control Automated/Manual 1. To conduct a walkthrough of the process of getting requests for maintenance of vehicles/buses

and identify gaps, if any. Use T-Codes IW29, IW23, IW33, IW39.

2. To check whether the requests received only through SAP. Use T-Codes IW29, IW23, IW33,

IW39.

3. To check whether there is a creation of maintenance order/MR/PR for the required spares. Use

T-Codes IW29, IW23, IW33, IW39, ME53N, ME5A.

4. In case of manual request, check the process of recording and monitoring of the requests

received.

5. To check whether an analysis is done for the time taken for closing a request.

6. To see that proper notification is given about defects. Use T-Codes IW29.

Audit Checklist

483

7. To check if root cause analysis is done for delays and steps are taken to avoid the same in

future.

36.TA.3.2 Maintenance Control Objective Efficient utilization and increased life of the equipment

Nature of Work Step Analysis/Verification Risk Inefficient utilization of equipment.

Nature of Control Automated/Manual 1. To check whether PM schedule has been displayed for every equipment/vehicle. Use T-Codes

IP24, IP10.

2. To check that there is display of the PM checklist in the workplace near vehicle. Use T-Codes

IA07.

3. To check whether there is a maintenance schedule for equipment and its compliance. Use T-

Codes IP24, IA07.

4. To check whether monitoring over turn around time as per schedule and actual time taken for

maintenance of equipment is done. Use T-Codes IP24 IW23, IW29, IW33, IW39.

5. To check whether the maintenance equipment are calibrated regularly. Use T-Codes IP24, IW33,

IW39.

6. To check whether the equipment/vehicles are tested under appropriate conditions and in

presence/by experience individual after completion of maintenance services. Use T-Codes

QA33, QGP2.

7. To check whether there is increase in fuel consumption due to delay in maintenance of vehicles.

8. To check whether monitoring is done for compliance to OEM guidelines for operating

equipment. Use T-Codes IA07.









delays.

Audit Checklist

484

37. Well logging – Technical Audit

Scope Audit Areas

1 Data collection and its storage

2 Interpretation

3 Planning and budgeting process (Equipment, manpower etc.)



6 Issuance of stores/spares items

7 Open hole/ cased hole

8 Logging equipment management and maintenance



11 Buy vis a vis Hiring of well logging equipment

12 Training



Audit Checklist

485

37.TA.1 Data collection and its storage Control Objective Timely and accurate data acquisition Nature of Work Step Analysis/Verification Risk Non-availability of desired data. Nature of Control Manual

1. To check whether the signed requisition for logs to be recorded is available with the

department.

2. To ensure there is timely receipt of data by the G&R department.

3. To check whether the timely planning is initiated for logging jobs in terms of man, materials,

logs required.

4. To check whether monitoring over plan for logging jobs in terms of man, materials, logs

required.

5. To check whether the logging equipment/spares/accessories are maintained and ready as per

schedule.

6. To check if there are any delays due to non-availability of equipment's/spares/accessories.

Ensure reasoning analysis is done for the same.

7. To check whether there are any delays in data collection. Ensure reasoning analysis is done for

the same.

8. To conduct a walk through of the data collection process Open hole/Cased hole and identify

gaps.

9. To check whether there exists a process of revalidating the accuracy of data collected.

10. To check whether there is a process for storage and back up process of log data.

37.TA.2 Interpretation Control Objective Accuracy of interpretation Nature of Work Step Analysis/Verification Risk Incorrect interpretation. Nature of Control Manual

1. To ensure there is correct interpretation of data.

2. To ensure correct logs are recorded.

3. To ensure security of data.

Audit Checklist

486

37.TA.4 Planning and administration Control Objective Procurement, production testing, stock, statutory compliance Nature of Work Step Analysis/Verification Risk 1. Non-adherence to statutory framework.

2. Non-availability of material.

Nature of Control Automated/Manual 1. Use T-Code ME5A to view the list of PRs and ME2N to view the list of POs. Check that there is no

delay in procurement of materials and oil well explosives.

2. Use T-Code MS04/MS05 to check whether planned production testing is carried out, so that

high consumption of explosives does not occur.

3. Use T-Code MB51, MMBE to check the movement of inventory at departmental storage

location.

4. To check there is monitoring of receiving, consumption, stock of explosives on monthly basis as

a measure of statutory compliance.

5. Check whether timely quarterly submission of return on explosives and detonators consumed

as a measure of statutory compliance is done.

37.TA.6 Issuance of stores/spares items Control Objective Avoid or minimize pilferage/loss, Avoid or minimize loss on account of

obsolete equipment's

Nature of Work Step Analysis/Verification Risk 1. Inefficient usage of resources.

2. Frequent breakdowns.

Nature of Control Automated/Manual 1. Check whether there is a process for review of inventory levels of stores/spares (maintenance)

items.

2. To conduct a walkthrough of the issuance process spares (maintenance) items from stores and

identify gaps.

3. Use T-Code MB5B to check whether there is timely availability of critical spares.

4. Use T-Code MB51 to check whether approvals for issue of stores/spares (maintenance) items

are taken as per DOP.

5. Analyze past quality issues and report to ensure that sub-quality spare parts are not used,

leading to frequent break downs.

6. Use T-Code MC46 and MC50 to check whether there is a process for monitoring over

obsolete/slow/non moving spares/materials and appropriate decisions are taken for the same.

Audit Checklist

487

37.TA.7 Open hole/ cased hole Control Objective Avoidance of financial loss

Nature of Work Step Analysis/Verification Risk Financial Risk.

Nature of Control Manual 1. To ensure that there are no delays in recording of data due to non-availability of

equipment's/spares/accessories.

2. To ensure that non utilization of logging unit/ tools does not occur.

3. To check if there is inaccurate reporting/ processing of information due to lack of interface

between applications and well logging equipment.

4. To ensure that there is segregation of duties so that there is no instance of inaccurate reporting.

37.TA.8 Logging equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment

Nature of Work Step Verification Risk Inefficient utilization of resources.

Nature of Control Automated/Manual 1. To check whether the utilization of equipment's if reviewed regularly.

2. To check whether there is a maintenance schedule (preventive/regular) for equipment and its

compliance.

3. Use T-Code IP10 and IP30 to ensure that tool breakdown is averted through maintenance and

no delay in operations is caused on this account.

4. Use T-Code IP10 and IP30 to check whether monitoring over turn around time as per schedule

and actual time taken for maintenance of equipment is done.

5. To check whether the equipment's are calibrated regularly.

6. Use T-Code IW29 and IW39 to check that there are no delays in providing maintenance services

which could otherwise impact operational efficiency.


equipment.

37.TA.9 Environment, Health and Safety Compliance Control Objective No penalties or imprisonment as applicable under the rules/provisions

Nature of Work Step Verification Risk Non-compliance to statutory requirements.

Nature of Control Manual 1. To check the compliance of the statutory requirements for radioactive/explosive items.

2. To check the compliance of the standard operating procedures of EHS.

3. To check whether monthly/quarterly/annual reports are timely filed with the Govt./State Govt.

Authorities/AERB etc.

Audit Checklist

488

37.TA.10 Certification of bills of vendor Control Objective Authorized payment, No duplicity payments

Nature of Work Step Verification Risk Unauthorized Payments, Duplicity of payments

Nature of Control Automated/Manual 1. Conduct a walkthrough of certification of bills of vendor.

2. Use T-Code FBL3N/FBL1N to view vendor payments. For sample invoices check whether

vendor's invoices are paid only after proper supporting's have been verified and approval is

taken as per DOP.

3. Use T-Code FBL3N/FBL1N to check whether advance payment made to the vendor is adjusted

while making payment of invoice, if applicable.

4. To ensure there is correct certification of bills leading to correct payments.

5. Use T-Code FBL3N/FBL1N to check whether payment is made only against liability created in

SAP.

37.TA.12 Training Control Objective Develop trained and skilled manpower

Nature of Work Step Analysis/Verification Risk Untrained Manpower.

Nature of Control Manual 1. To check whether there is a training schedule to train the employees on a regular basis.





3. To check whether the manual records are verified and approved by concerned authority. 4. Use T-Code ML84 to view the list of SES's and ML81N to view the details of specific SES.

Check whether the SES for the services received is timely prepared. 5. Check whether proper technical survey/inspection is carried out for quality assurance

before creation of SES. 6. Check whether the inspection carried out is approved as per DOP. 7. Check whether there is a process of monitoring the date of completion as mentioned in

the contract w.r.t the actual date of completion/creation of SES. 8. Check whether reasoning analysis is done for the delays and steps are taken to avoid

similar delays.

Audit Checklist

489





Audit Checklist

490

38. Business Development – Technical Audit

Scope Audit Areas

1 Asset acquisitions

2 New opportunities

3 Monitoring

4 PR tracking


6 Manpower planning

Audit Checklist

491

38.TA.1.1 Asset acquisitions Control Objective Approvals are obtained as per delegation Nature of Work Step Verification Risk Non Compliance to the delegation of authority matrix. Nature of Control Manual

1. Check whether the opportunity was evaluated as per the approved checklist.

2. Check whether approvals have been obtained to pursue the opportunity as per delegation of

powers.

38.TA.1.2 Asset acquisitions Control Objective Confidentiality of data is maintained Nature of Work Step Verification Risk Confidentiality of data is not maintained. Nature of Control Manual

1. Check whether confidentiality agreements are in place duly signed by appropriate authority

before data sharing.

2. Ensure that proper back-up procedures are there for any data in soft or hard form.

38.TA.1.3 Asset acquisitions Control Objective Hiring of consultants is as per contracts manual Nature of Work Step Verification Risk Consultant hiring is not as per contracts manual, CVC guidelines not followed

while hiring contractors. Nature of Control Manual

1. Check the procedures followed for appointment of any technical or commercial consultant to

evaluate opportunity is in line with Contracts Manual.

2. Ensure all CVC guidelines have been followed in hiring of contractor.

38.TA.2 New opportunities Control Objective Appropriate evaluation of opportunity Nature of Work Step Verification/Analysis Risk Opportunities not being evaluated appropriately. Nature of Control Manual

1. Check if approval of appropriate authority is available before finalization of opportunity.

2. Check whether proposed benefits have been identified and documented for opportunity.

3. Check whether payback period has been calculated and monitoring plan has been prepared.

Check suitability of the method applied for calculation of payback period.

4. In case of opportunity win or loss check that appropriate filing is done for the documents

pertaining to opportunity and same are readily accessible for any future reference.

5. Ensure that all legal and statutory requirements are considered while evaluating any

opportunity.

6. Ensure appropriate negotiations are done before finalizing the deal.

Audit Checklist

492

42. PHQ OIL Movement – Technical Audit

Scope Audit Areas


2 Costs


4 Forward transfers

5 Reverse transfers

6 Reconciliation

7 Maintenance

8 Oil Transportation Contract

9 Billing

10 Service contract management

11 Closure of service contract

12 PR tracking



Audit Checklist

493

42.TA.1 Environment, Health and Safety Compliance Control Objective Safeguarding interest of Company / employees / public / environment Nature of Work Step Verification Risk Non Compliance to EH&S. Nature of Control Manual





basis to Govt./State Govt./Authorities/ Atomic Energy Regulatory Board (AERB).

42.TA.2 Forward transfers Control Objective Custody transfers Nature of Work Step Analysis/Verification Risk 1. No monitoring on transit losses.

2. No monitoring on the internal/external transfers. Nature of Control Automated/Manual

1. To check whether internal/ external transfers are done as per proper guidelines/ process.

2. To check whether correct measurement is done during custody transfer.

3. To check whether ratio limit for oil transfer of OIL/ ONGC is entered into SAP.

4. To check whether pilferage of oil while transportation is monitored. Use T-Code VL06F.

5. To check whether the percentage of loss due to transport is monitored.

6. To check whether the percentage of oil is measured both before and after loss due to

evaporation, measurement, leakage etc.

7. To check whether transit losses are within approved limit.

8. To check whether joint samples are taken for BS&W and Custody transfers.

9. To check whether NSPL is able to offtake and deliver as per agreed MOU.

42.TA.3 Reverse transfers Control Objective Quantity reconciliations Nature of Work Step Verification Risk Incorrect quantity reconciliations. Nature of Control Manual

1. To check process of reverse transfer and quantity reconciliations for the same.

42.TA.4 Reconciliation Control Objective Loss minimization Nature of Work Step Verification Risk No measures to minimize losses. Nature of Control Manual

1. To check whether reconciliation is done at pipeline.

2. To check whether there is reconciliation done between production and off-take.

3. To check if there is penalty for raw material on reduced off take.

42.TA.5 Maintenance Control Objective Timeliness

Audit Checklist

494

Nature of Work Step Verification Risk Delay in maintenance of pipelines. Nature of Control Automated/Manual

1. To check whether blockages in pipelines are timely reported and unblocked. Use T-Codes IP24,

IW23, IW39.

42.TA.6 Oil Transportation Contract Control Objective Compliance to the terms of contract Nature of Work Step Verification Risk Non-compliance to contract terms. Nature of Control Automated/Manual

1. To check whether there is compliance to contractual terms. Use T-Code ME2N and ME33K.

2. To check whether the terms of the contract are reviewed periodically and corrective measures

are taken to ensure that cost benefits are achieved.

3. To check whether the contract is validated by Legal cell for checking Company's interest.

42.TA.7 Service contract management Control Objective Recording of justification in case of extension Nature of Work Step Analysis/Verification Risk Non-compliance as per DOP. Nature of Control Automated/Manual

1. To check whether the extension of the contract period and waiver of liquidated damage are

approved as per DOP. Use T-Code ME3J and ME33K.

2. To check whether reasons for extension of contract period are recorded and analyzed for any

further action.

3. To check whether in case any Approving committee finds it necessary to revise its own earlier

decision of imposing liquidated damages and to waive recovery thereof, ensure approval of the

next higher Authority is obtained as per DOP. Use T-Code ME3J.

42.TA.8 Closure of service contract Control Objective Full and final settlement before closure of contract Nature of Work Step Verification Risk Improper full and final closure. Nature of Control Automated/Manual

1. To check whether before closing of a Contract the following has been ensured:

a. Satisfactory completion of the work.

b. Payment reconciliation, Stores reconciliation, No dues/claims certificate from the Heads

of Department concerned, for the release of final payment.

c. Satisfactory completion of defects liability period and return of Security Deposit or

Performance Security. Use T-Codes CJ20N.



Audit Checklist

495







delays.

Audit Checklist

496

43. PHQ Pipeline – Technical Audit

Scope Audit Areas










10 Maintenance

11 Training

12 PR tracking


Audit Checklist

497









delays.

43.TA.2 Environment, Health and Safety Compliance Control Objective Safeguarding interest of Company / employees / public / environment Nature of Work Step Verification Risk 1. Delays in payments.

2. Incorrect payments. Nature of Control Manual


To check whether EH&S compliance framework is monitored and reviewed on regular basis.



basis to Govt./State Govt./Authorities/Atomic Energy Regulation Board (AERB).

4. To ensure adequate measures are undertaken to mitigate the risk in case of pipeline burst.

43.TA.3 Maintenance of sub surface pipelines including surface facilities (Routine jobs) Control Objective Entering into proper contracts Nature of Work Step Analysis/Verification Risk Absence of proper contracts. Nature of Control Manual

1. Ensure that conditions to the contracts are being complied. Report deviations if any.

Audit Checklist

498

43.TA.4 Maintenance of sub surface pipelines including surface facilities (Non routine

jobs) Control Objective Adequate internal handling Nature of Work Step Verification Risk Inadequate internal handling. Nature of Control Manual

1. To check whether non routine jobs are adequately and timely handled through internal

resources.

43.TA.5 Health inspection of pipelines Control Objective Inspection Nature of Work Step Verification Risk Non Compliance to OISD guidelines. Nature of Control Manual

1. To check whether the health inspection of pipeline is carried regularly as per OISD norms.

43.TA.6 Inventory control of maintenance / spares items Control Objective Avoiding stock out situation, adequate approvals for issuance,

inventory controls Nature of Work Step Verification Risk Ineffective inventory control. Nature of Control Automated/Manual

1. To check whether there is a process for review of inventory levels of materials/spares items.

Use SAP Transaction-code MMBE, MB52, MB5B.


identify gaps.

3. To check whether approvals for issue of materials/spares items are taken as per DOP.

4. To check whether there is a process for monitoring over obsolete / slow / non moving /

materials or spares and appropriate decisions are taken for the same. Use T-code MC46 and

MC50.

43.TA.7.1 Maintenance of Crude Oil Delivery (COD) Lines Control Objective Choke free and free flow of delivery lines

Nature of Work Step Verification Risk Stoppage of Crude Oil delivery.

Nature of Control Manual 1. To check that pressure is relieved from the pipeline before commencing of maintenance to

ensure that there is no fire.

2. To check that pigging operation of pipeline is conducted as per defined schedule.



43.TA.7.2 Safety Non Compliance to Environment, Health and Safety. Control Objective Safety

Nature of Work Step Verification Risk Non Compliance to Environment, Health and Safety.


Audit Checklist

499


of Fire Service on standby duty at site during maintenance and repairs.

43.TA.8.1 Maintenance Control Objective Timely closure of maintenance requests to avoid operational delays

Nature of Work Step Verification Risk Operational delays.

Nature of Control Automated/Manual 1. To conduct a walkthrough of the process of getting requests for maintenance of sub surface

pipelines and surface facilities. Use T-code IW29, IW39 if data is maintained in SAP.

2. To check that timely maintenance services are provided.

3. To check whether the requests received only through SAP Use T-Code ME5A This transaction is

use to take PR list generated through SAP.

4. To check whether there is a creation of maintenance order/MR/PR for the required spares. Use

T-Codes ME5A,IW29,IW39.

5. In case of manual requests, check the process of recording and monitoring of the requests

received.

6. To check whether an analysis is done for the time taken for closing a request. Use T-Code ME5A.

7. To see that proper notification is given about defects.

8. To check if root cause analysis is done for delays and steps are taken to avoid the same in

future.

43.TA.8.2 Maintenance Control Objective Efficient utilization and increased life of the equipment

Nature of Work Step Analysis/Verification Risk Inefficient utilization of equipment.

Nature of Control Automated/Manual 1. To check whether PM schedule has been displayed for every pipeline Use T-Code IP24 This

report gives the list of maintenance plans created for an equipment. To check that there is

display of the PM checklist in the workplace.

2. To check whether there is a maintenance schedule for equipment and its compliance Use T-

Code IP24.ERP. This report gives the list of maintenance plans created for an equipment.

3. To check whether monitoring over turn around time as per schedule and actual time taken for

maintenance of equipment is done. Use T-Code IW29, IW39, IP24 IW29 gives the complete

history of notification along with order. IW39 provides the entire history of equipment along

with maintenance details.

4. To check whether the equipment are calibrated regularly. Use T-code IW29, IW39, IP24. IW29

gives the complete history ho notification along with order. IW39 provides the entire history of

equipment along with maintenance details.

5. To check whether the services equipment are tested in presence/by experience individual.


equipment.

Audit Checklist

500

43.TA.8.3 Maintenance Control Objective Updating of equipment master

Nature of Work Step Analysis/Verification Risk Ineffective maintenance planning

Nature of Control Automated/Manual 1. Check whether equipment master has been updated in SAP. IH01-IH08

2. Compare equipment master maintained in excel sheet / hard copy with the equipment master

maintained in SAP.

3. Check on sample basis whether equipment available on site have been updated in SAP.

4. Check on sample basis, whether status and details maintained in equipment master is correct.

5. Check on site, if any inactive equipment is available. Compare with status in equipment master.

43.TA.9 Training Control Objective Trained workforce

Nature of Work Step Verification Risk Lack of training

Nature of Control Manual 1. To check whether training calendar/schedule for the workforce is planned.

2. To check whether planned training schedule for the workforce is complied with.


4. To check whether attendance is recorded for the workforce who attended the trainings.


6. To check that adequate training is provided to manpower.


training process.

Audit Checklist

501

44. PHQ – Pump Stations – Technical Audit

Scope Audit Areas










10 Maintenance

11 Training

12 PR tracking


Audit Checklist

502

44.TA.1 Third party custody transfer Control Objective Sampling, Handover Nature of Work Step Verification Risk Improper sampling, delay in handing over, error in measurement. Nature of Control Manual

1. To check sampling is done as per defined procedures.

2. To check whether there is adequate monitoring of defined parameters (pressure drop, etc.) for

the flow of crude oil in the pipeline.

3. To ensure that auto sampler is readily available.

4. To check that the handover is done within timelines so that pumping can start timely.

5. To check whether there is correct recording during custody transfer.

6. To check proper recording and certification by concerned officers from OIL, IOCL, Government

Authorities.

7. To check that proper joint inspection is done after the tank gets empty i.e. before handover to IOCL / NRL or taking delivery of ONGC crude at PS Moran / Jorhat.

44.TA.2.1 Assets/ Equipment Control Objective Utilization Nature of Work Step Verification Risk Non-utilization, underutilization. Nature of Control Manual

1. To ensure effective and efficient utilization of assets/ equipment.

44.TA.2.2 Assets/ Equipment Control Objective Breakdown support Nature of Work Step Verification Risk No breakdown support. Nature of Control Manual

1. To check whether there is timely support during breakdown.

44.TA.3 Equipment management and maintenance Control Objective Efficient utilization and increased life of the equipment Nature of Work Step Verification/Analysis Risk Inefficient utilization and decreased life of equipment. Nature of Control Manual/Automated

1. To check whether the utilization of equipment's if reviewed regularly.

2. To check whether there is a maintenance schedule (preventive/regular) for equipment and its

compliance.

3. Use T-Code IP10 and IP30 to ensure that tool breakdown is averted through maintenance and

no delay in operations is caused on this account.

4. Use T-Code IP10 and IP30 to check whether monitoring over turn around time as per schedule

and actual time taken for maintenance of equipment is done.

5. To check whether the equipment's are calibrated regularly.

6. Use T-Code IW29 and IW39 to check that there are no delays in providing maintenance services

which could otherwise impact operational efficiency.


equipment.

Audit Checklist

503

44.TA.4 Reporting Control Objective Timeliness Nature of Work Step Verification Risk Delay in reporting. Nature of Control Manual

1. To check that both administrative reporting and functional reporting is done.

2. To check whether there are delays due to dual reporting

44.TA.5 Environment, Health and Safety Compliance Control Objective Safeguarding interest of Company / employees / public / environment Nature of Work Step Verification Risk 1. Non-compliance to EHS guidelines.

2. Statutory Non-Compliance. Nature of Control Manual




4. To check whether required documents/report/returns are filed on monthly/quarterly/annually

basis to Govt. / State Govt. / Authorities/Atomic Energy Research Board (AERB).

5. To ensure compliance to the safety requirement.

44.TA.6 Security services Control Objective Effective implementation of activities Nature of Work Step Verification Risk Ineffective implementation may lead to pilferage, security lapse, accidents,

social pressures etc. Nature of Control Manual

1. To ensure there is appropriate security infrastructure and equipment.

2. To ensure there is no delay in providing security services.

3. To check whether the risk from anti-social elements was averted through liasoning with local

police, coordination with CISF and Assam Industrial Security Force (AISF) etc.

4. To check that there is issue of security passes on day to day basis and periodic basis by

CISF/Security department to labors and visitors with recommendations of the user departments

to enter in the restricted area.

5. To check whether inventory of arms and ammunitions are checked and maintenance done on

regular basis.

6. To check whether advance intelligence inputs are gathered.

7. To check whether mock drills of security alertness and preparedness are conducted, up

gradation of security gadgets, access and exit controls, proper documentations exist.

Audit Checklist

504

44.TA.7 Operations Control Objective Effective implementation of activities Nature of Work Step Verification Risk Ineffective implementation may lead to operational delays. Nature of Control Automated/Manual

1. To check whether there is presence of installation Manager/Site In-Charge.

2. To check whether verification of key personnel like technician, etc. is done as per manpower

contract.

3. To check whether existence of medical facilities within / nearby the pump stations etc.

4. To check availability of maintenance spares. Use transaction code MB52.

5. To verify compliance to pollution control board requirements.

6. To check and verify the deployment of WCLs as per the contract.

7. To verify unused/idle inventory. Use T-codes MC46 and MC50.

8. To check that pump station layout diagram and plan is approved.

9. To check and verify the imprest cash and its records as per DOP. Report deviations if any.

Audit Checklist

505

46. Wind Energy – Technical Audit

Scope Audit Areas

1 Accounting

2 Maintenance

3 Operations

4 Revenue generation


6 Manpower planning

Audit Checklist

506

46.TA.1 Maintenance Control Objective Adequate preventive maintenance mitigating the risk of undue breakdowns. Nature of Work Step Verification/Analysis Risk Preventive maintenance not undertaken as scheduled resulting in increased

downtime and production loss. Nature of Control Automated/ Manual

1. Use T-Code IP24 to review whether preventive maintenance schedule has been prepared and approved at the beginning of year.

2. Use T-Code IA07 to extract report and check whether preventive maintenance planned was as per the guidelines provided by machine manufacture.

3. Use T-Code IW23, IW29, IW33, IW39 to check whether timely corrective action taken on breakdowns in machines.

4. Ensure that proper analysis is performed for repeated breakdowns in same machinery due to identical reasons and corrective actions are taken against the same.

46.TA.2 Operations Control Objective Production is achieved up to maximum achievable capacity of plant. Nature of Work Step Verification/Analysis Risk 1. Underutilization of plant.

2. Diseconomies of scale. Nature of Control Manual

1. Use T-Code CM51, CM52, CM50 to ensure that the production capacity utilizations have been approved by the designated persons at the beginning of the year.

2. Review whether the capacity utilization limits have been derived on the basis of correct assumptions.

3. Ensure that the capacity utilization target is achieved. 4. Review whether the reasons for deviations in achieving the capacity utilization targets are

analyzed and proper / timely action is taken against the same.

46.TA.3 Creation of Service Entry Sheet (SES) Control Objective Timely and accurate receipt of material Nature of Work Step Verification Risk 1. Delays in payments.

2. Incorrect payments. Nature of Control Manual/ Automated

1. To check whether status of work completion in manual records is updated as per contract terms. Use T-code ME2S/MSRV1.






delays.

Audit Checklist

507

ERP

Audit Checklist

508

10. ERP – ERP

Scope Audit Areas


2 Access controls

3 SAP users and licence controls


5 Audit logs



8 PR tracking




Audit Checklist

509

10.ERP.1 SAP Change management Control Objective Authorized changes, reason for change are documented and can be tracked Nature of Work Step Verification Risk Unauthorized changes. Nature of Control Automated/Manual

1. Check whether Change Management Policy is available. 2. Obtain list of Change requests / transport requests made through Support Request Portal. If

uploaded in SAP then also use T-code SE10 (solman_workcenter) to check whether the Change Request Form is raised by the user containing the following information: a. Details of Change; b. T-codes impacted; c. Process flow impacted d. Comparison of existing and new process after change; e. Formats and exact details for change; f. Expected time by when changes to be done; g. Responsible person from User department; h. Responsible person from SAP Team

3. Check that Change Request Form is duly authorized as per DOP. (Also check availability of DOA)

4. Check whether change is analyzed and approved by SAP functional Lead and SAP ABAP lead. 5. Check whether testing is done by ERP team before moving to quality and also check it has

been signed off by user before moving to production. 6. Use T-code SE16N (solman_workcenter) to check whether all change requests are tracked

properly in Solman or Manual system. Tracking should contain: a. Ticket number; b. Description of Change; c. T-Code impacted; d. Responsible SAP lead both (Functional/ABAP); e. Expected resolution time; f. Actual resolution time.

7. On sample basis, check that adequate logical controls and processing controls are built in SAP and are working effectively.

8. Use T-codes OB52 and MMPV to check that controls that restrict post-dated or back-dated entries are available.

10.ERP.2 Access controls Control Objective Access to authorized person and authorized transaction Nature of Work Step Analysis / Verification Risk Unauthorized access leading to unauthorized transactions.

Nature of Control Automated / Manual 1. Use T-codes SU03, SUIM and PFCG to check that access controls are provided to authorized

personnel only. 2. Use T-code SUIM to check that access rights available to employees are closed after their

separation from the Company. Obtain HR master, and compare from Active and dormant SAP iD from HR master.

3. Use T-codes SU03, SUIM and PFCG to check the process of change in access at the time of transfer or change in role.

4. Use T-codes SU03, SUIM and PFCG to check that access rights granted to a person are transaction specific.

Audit Checklist

510

10.ERP.3 SAP users and license controls Control Objective Original SAP license, limited number of users and minimal cost

Nature of Work Step Analysis / Verification Risk Inefficient usage of SAP license. Nature of Control Automated/ Manual

1. Check that the SAP license has been purchased from authorized vendors and is updated regularly.

2. Use T-code SUIM to check the license and to ascertain the number of users for whom license has been obtained against the actual number of users.

3. Check if any extra cost is being incurred on SAP software due to extra or less users.

10.ERP.4 Master data maintenance Control Objective Authorized data creation or alteration in master Nature of Work Step Verification

Risk Unauthorized creation/ alteration of master data. Nature of Control Manual / Automated

1. Use T-codes SU03 and PFCG to check that master data has been duly authorized as per DOP. 2. Use T-code SUIM to check alterations in master data have been authorized as per DOP. 3. Use T-codes XK03, FK03 and SE16N to check the presence of compulsory fields like Party PAN

No. in SAP which restrict duplication of master data i.e. duplicate entry for same party.

10.ERP.5 Audit logs Control Objective Track changes and keeping change records Nature of Work Step Verification Risk No logs/ records available to verify critical transactions and changes in

master data. Nature of Control Automated / Manual

1. Use T-Code SM20 to check that audit logs are generated for all critical transactions and master data changes. Check whether SOP is maintained for review to be done by SAP team for audit logs.

2. Check if the audit logs are reviewed on periodic basis. 3. Check if audit logs are adequately backed up.

10. ERP.6 SAP budget and related expenses Control Objective Adherence to budget ensuring cost controls Nature of Work Step Verification / Analysis Risk Non-adherence to budget. Nature of Control Manual / Automated

1. Use T-code S_ALR_87013558 to check whether a budget has been prepared for costs to be incurred on SAP.

2. Use T-code S_ALR_87013558 to check whether costs incurred on SAP are as per budget and reason for deviation, if any.

3. Use T-code S_ALR_87013558 to check any costs incurred apart from the purposes mentioned in budget.

Audit Checklist

511

10. ERP.7 User training and SAP usage Control Objective Employee training and development Nature of Work Step Verification Risk Inadequate SAP support provided to employees. Nature of Control Manual

1. Check whether SAP training programs are conducted periodically to make employees more familiar with new changes or patch.

2. Check if the training manuals are documented and available to all employees for easy reference.

3. Check whether a helpdesk is available to provide employees with backup support for SAP related problems.

4. Check whether SLAs are defined and monitored to ensure timely resolution of user requests.

10. ERP.8 Contract monitoring Control Objective To ensure contractual terms are followed by the contractor. Nature of Work Step Verification Risk Breach of contractual terms. Nature of Control Manual / Automated

1. Check if there is a process to ensure regular monitoring of compliance of contractual terms by contractor.

2. Use T-code ML82 to check whether SES is created timely and after appropriate inspection of the service procured.

3. Ensure that all the contracts are renewed timely. A tracker is maintained to ensure that the renewal process is started timely keeping the lead time in mind.

10.ERP.9 Creation of Service Entry Sheet (SES) Control Objective Exploiting the best option available Nature of Work Step Analysis / Verification Risk 1. Delays in payments.









Audit Checklist

512

18. Information Technology – ERP

Scope

Audit Areas


2 Statutory Compliance

3 User request management

4 Disaster recovery site

5 Process documentation

6 Backup procedures

7 IT administration

8 PR tracking




12 Logical controls

13 IT applications

14 ERP solutions


16 IT infrastructure and environmental controls


18 Network security


20 Logical controls

21 IT applications

Audit Checklist

513

18.ERP.1 ITGC - User request management Control Objectives

Proper system for recording and handling complaints


Risk Delay in resolution of complaints and user dissatisfaction.


1. Check there is proper procedure of recording and resolution of IT complaint.

2. Check the SLAs for IT services are properly defined and monitored.

3. Check if user feedback is obtained and analyzed for future improvement.

18.ERP.2 ITGC - Disaster recovery site Control Objectives Maintenance of DRS, keeping of data in DRS and backup

files.


Risk Loss to data.


1. Check whether disaster recovery plan is in place for critical business processes.

2. Check whether disaster recovery site is available and away from the original building.

3. Check whether DRS is equipped with enough safety measures.

4. Check whether backup data is regularly updated at disaster recovery site.

5. Check whether process is in place to ensure the data backup completeness Vis a Vis the

production server.

18.ERP.3 ITGC - Process documentation Control Objectives Clarity of process, roles completely defined for IT personnel


Risk Risk to security of data and IT infrastructure.


1. Check whether standard operating procedure are available and are being followed.

2. Check whether IT policy is comprehensively defined to address all aspects of IT (e.g. Network

security, configurations, logical access controls, physical access controls, environmental

controls, licensing, antivirus, backup procedures and Disaster Recovery Plan etc.).

3. Check if the recommendations of various IT and security audits are implemented.

4. Check if there is any deviation in the process followed from the defined IT policy.

18.ERP.4 ITGC - Backup procedures Control Objectives Data backup, restoration and timely utilization

Nature of Work Step Analysis

Risk Data loss.


Audit Checklist

514

1. Check whether data backup is taken on periodic basis as per backup policy.

2. Check whether data backup are restored to confirm that entire data has been backed up and

is not corrupted.

3. Check if critical applications like SAP are timely backed up as per defined policy.

4. Check that data backup is kept at a safe place and away from manual or natural intrusions.

5. Check if proper logs are created and monitored for all backups and restoration tests.

6. Check that a set of data backup is kept at remote location.

18.ERP.5 ITGC - IT administration Control Objectives Adequacy of Budgeting, planning, AMCs and required approvals

Nature of Work Step Analysis

Risk Unauthorized expenditure and non availability of required AMCs

and insurance coverage.


1. Check whether proper budget is available and expenses are incurred in accordance.

2. Check whether all IT procurement is in line with company policy and adequately approved. Use

T-code ME23N and ME53N.

3. Check whether AMC for maintenance services is timely renewed.

4. Check if the SLAs are clearly defined and monitored for the services received from outside

vendors.

5. Check if all adequate insurance coverage is taken and timely renewed for all IT setup and

systems.

18.ERP.6 ITGC - Creation of Service Entry Sheet (SES) Control Objectives Timely and accurate receipt of material


Risk 1. Delays in payments.

2. Incorrect payments.


1. Check whether status of work completion in manual records is updated as per contract terms.

Use T-code ME2S/MSRV1.

2. Check whether confirmation or acknowledgement of work completed is taken from contractor

on manual records.

3. Check whether the manual records are verified and approved by concerned authority.

4. Use T-Code ML84 to view the list of SES's and ML81N to view the details of specific SES. Check

whether the SES for the services received is timely prepared.

5. Check whether proper technical survey/inspection is carried out for quality assurance before

creation of SES.

6. Check whether the technical inspection carried out is approved as per DOP.

7. Check whether there is a process of monitoring the date of completion as mentioned in the

contract w.r.t the actual date of completion/creation of SES.

8. Check whether reasoning analysis is done for the delays and steps are taken to avoid similar

delays.

Audit Checklist

515

18.ERP.7 ITGC - Manpower planning Control Objectives To ensure manpower is adequate for all the departmental activities


Risk 1. Over/Under Utilization of manpower.

2. Operational delays caused due to low manpower.


1. Check whether there is adequate manpower to carry out all the operations of the department -

administrative and technical.

2. Ensure manpower requisition forms are raised timely and approved as per DOP.

3. Check whether there is a follow up process in place to ensure timely conversion of MPR.

18.ERP.8 Commercial Systems - Logical controls Control Objectives Authorized access, password protection and original software's


Risk Unauthorized access to system and data.


1. Check whether access is granted after proper authorization and approval to prevent any

unauthorized access to Information System and Services.

2. Check if process is in place for periodic monitoring and timely removal of access which are not

required.

3. Check if internet access is controlled and adequate security measures are taken to prevent

unauthorized access through internet.

4. Check that strong password protection is provided for all applications.

5. Check that only original software's are installed on the system to protect from data getting

corrupted.

6. Check that whether systems are automatically locked after a fixed time when idle to restrict

unauthorized access.

7. Check if access to removable storage devices is restricted and granted only on exceptional basis

with adequate approvals.

8. Check if all IT systems are prevented with updated antivirus.

9. Check if audit logs for all critical transactions including, access, and denial, services used etc. are

generated, backed up and monitored.

10. Check if administrative password is available to authorized person only.

11. Check is the password policy is implemented and working in all IT systems.

12. Check if file and folder sharing is restricted and used on exceptional basis after adequate

approvals.

13. Check if service packs are timely updated and tested before updation.

Audit Checklist

516

18.ERP.9 Commercial Systems - IT applications Control Objectives Outward data, QC check and efficiency of SAP


Risk Inefficiency of IT application and threat to data security.


1. Check whether IT personnel is monitoring the outward data flow.

2. Check if only licensed applications are used and no unauthorized application is installed on any

IT system.

3. Check whether appropriate version control mechanisms are operating.

4. Check that before updating a patch, following process is followed:

a. In case of SAP application, it has been tested and verified on development server and

quality server before moving to production server

b. In case of other applications, it has been tested and verified on independent system before

moving to production system.

18.ERP.10 Commercial Systems - ERP solutions Control Objectives ABAP and BASIS


Risk Improper tracking and documentation.


1. Check whether proper tracking is done for all the ERP change management requests.

2. Check whether system is in place to ensure timely resolution of all the requests.

3. Check whether all the changes are duly authorized and approved as per defined process.

4. Check if all the changes are tested and documented before finalization.

5. Check if audit logs for all critical transactions are generated, backed up and monitored.

18.ERP.11 Infrastructure - IT infrastructure and environmental controls Control Objectives Adequate Temperature maintenance and availability of safety

equipment


Risk Insufficient provisions for power backup and safety of IT

infrastructures.


1. Check if adequate fire safety measures are taken to safeguard the IT system.

2. Check whether adequate temperate is maintained in the server room to protect any damage to

hardware or software.

3. Check whether server room is located at a safe place and equipped with all safety equipment

and devices.

4. Check all the environmental control required as per IT policy are in place and monitored

regularly.

5. Check if alternate power backup provisions are maintained for server room and Key IT systems.

Audit Checklist

517

18.ERP.12 Network & Communication - Network security Control Objectives Adequate Network Security


Risk Loss or leakage of data.


1. Check whether firewalls are in place to prevent any unauthorized access.

2. Check if vulnerable services are blocked on all IT systems.

3. Check whether the confidential documents like network diagram with IP addresses is not easily

accessible to outsider.

4. Check that redundant ports and services are disabled on network equipment.

5. Check whether users have direct access to tools like SQL, TOADS etc.

6. Check if all network equipment's are adequately configured in line with Company's IT policy.

18. ERP.13 Technical Systems - Logical controls Control Objectives Authorized access, password protection and original software's


Risk Unauthorized access to system and data.


1. Check whether access is granted after proper authorization and approval to prevent any

unauthorized access to Information System and Services.

2. Check if process is in place for periodic monitoring and timely removal of access which are not

required.

3. Check if internet access is controlled and adequate security measures are taken to prevent

unauthorized access through internet.

4. Check that strong password protection is provided for all applications.

5. Check that only original software's are installed on the system to protect from data getting

corrupted.

6. Check that whether systems are automatically locked after a fixed time when idle to restrict

unauthorized access.

7. Check if access to removable storage devices is restricted and granted only on exceptional basis

with adequate approvals.

8. Check if all IT systems are prevented with updated antivirus.

9. Check if audit logs for all critical transactions including, access, denial, services used etc. are

generated, backed up and monitored.

10. Check if administrative password is available to authorized person only.

11. Check is the password policy is implemented and working in all IT systems.

12. Check if file and folder sharing is restricted and used on exceptional basis after adequate

approvals.

13. Check if service packs are timely updated and tested before updation.

Audit Checklist

518

18.ERP.14 Technical Systems - IT applications Control Objectives Outward data, QC check and efficiency of SAP


Risk Inefficiency of IT application and threat to data security.


1. Check whether IT personnel is monitoring the outward data flow.

2. Check if only licensed applications are used and no unauthorized application is installed on any

IT system.

3. Check whether appropriate version control mechanisms are operating.

4. Check that before updating a patch, following process is followed:

a. In case of SAP application, it has been tested and verified on development server and

quality server before moving to production server

b. In case of other applications, it has been tested and verified on independent system before

moving to production system.

Audit Checklist

519

24. Materials Management- ERP

Scope Audit Areas


2 Access controls

3 SAP users and license controls


5 Audit logs



8 PR tracking




Audit Checklist

520

24.ERP.1.1 Operations Control Objectives Efficiency in operations


Risk 1. Inadequate fixation of key performance appraisal.


1. To ensure that key performance indicators are fixed leading to efficiency in operations. (Illustrative list of KPI which may be set for MM department. Lead time in converting PR to PO, No. of defaults in obtaining material delivery on time, lead time for each step).

2. Check whether performance of MM department has been evaluated.

24.ERP.1.2 Operations

Control Objectives To verify authorization controls over materials master creation & amendment.


Risk 1. Distortion of inventory master resulting in delay in procurement, procurement of wrong items, and wrong classification of material. 2. Operational delays.

3. Incorrect stock valuation. Nature of Control Manual / Automated

1. Obtain a list of persons authorized to request creation & amendment in MM01 & MM02 of material master.

2. Obtain a list of persons authorized to create & amend material master. 3. Verify whether the requests for change in master are approved by the appropriate authority. 4. Verify whether the authorizations are in compliance with MM Manual / DOP. 5. Obtain the log of changes to the inventory master and verify whether the changes made are

valid, accurate and processed on a timely manner in accordance with the approved request. 6. Check existence of duplicate record. 7. Obtain the reason for exception and report the same.

24.ERP.1.3 Operations

Control Objectives To verify authorization controls over vendor master creation and amendment.


Risk 1. Distortion of vendor master resulting in delay in procurement, procurement of wrong items, wrong sourcing.

2. Above may finally result in disruption of operations. 3. Incorrect vendor valuation.


Audit Checklist

521

1. Obtain a list of persons authorized to request creation & amendment in MK01 & MK02 of vendor master.

2. Obtain a list of persons authorized to create & amend vendor master. 3. Verify whether the request for change in master is approved by the appropriate authority. 4. Verify whether the authorizations are in compliance with MM Manual / DOP. 5. Obtain the log of changes to the vendor master and verify whether the changes made are valid,

accurate and processed on a timely manner in accordance with the approved request. 6. Check existence of duplicate record. 7. Obtain the reason for exception and report the same.