Auditing is a major step in achieving and maintaining compliance to management system standards. Internal audits can identify nonconformities, measure performance, ensure continuous improvement in the work environment, and most importantly determine compliance.

This raises an important question: who does your organization rely on to conduct an internal audit? Some businesses have designated employees, internal auditors, that carry out audit activities themselves. Other businesses outsource their audits, hiring a professional experienced auditor to assess their management system. Which method is the best fit for your organization, and what are the pros and cons of both? Let’s discuss.

Training An Internal Auditor

Pros:

Understanding of Culture. Internal auditors within your organization will often have a deeper understanding of company culture and the work environment. This is because they’re already an employee and experience or see business operations firsthand. This can save time in the auditing process, as an outside auditor would need to conduct interviews or observations to get a good idea of company culture themselves.

Continuous Availability. An internal auditor will be an employee within your company, meaning they’ll be readily available and easier to contact or communicate with. This reduces turnaround time for decisions, questions, or action being taken.

Development of In-House Expertise. With an internal auditor or auditing team, your organization will begin developing the knowledge and expertise needed to conduct activities relating to audits and management system maintenance. This can reduce the need for outside services and thus reduces the cost of this process, as you’ll only be paying the internal auditor and not a third-party company.

Cons:

Lack of Objectivity. Since the internal auditor will be an employee, their reports may not be completely objective or independent. Objectivity is important during internal audits because they help identify areas for improvement and risks that need to be addressed. If the internal auditor’s reports are not independent, it could hinder the overall management system.

Interference with Regular Activities. Often times, internal auditors are employees who also have another position within the company. This means that they will have conflicting tasks and schedules to manage, between their regular work activities and the audit. It may make their job more difficult or reduce the time that they can spend doing their main job, causing focus or productivity issues.

Conflict or Tension Between Departments. Cross-auditing with multiple departments has the potential to create some tension between employees or management. Auditors and management may not see eye to eye, and some may disagree with any negative findings that are being brought to light. This tension may also have to do with objectivity and the possibility of bias towards management or certain departments.

Outsourcing the Internal Audit

Pros:

Highly Objective and Impartial. When outsourcing an audit with a third-party company, these auditors are impartial and coming in with a clean slate. They most likely have never worked with your organization or management before, which means all observations and conclusions are made independently throughout the process. There’s also no need to worry about retaliation from other employees or administrators for negative findings.

Reduced Training and Logistical Costs. The cost of training an internal auditor can be expensive for small or medium businesses, especially when multiple employees will be receiving training. Training courses and resources may be expensive compared to hiring a third-party company to conduct the internal audit instead.

Specialized Knowledge and Experience. If you’re outsourcing an audit with another company, it may be because these auditors are certified and have much more experience with management systems and the auditing process. They have specialized knowledge to suit your needs, whether that means experience with an ISO 27001 Information Management System, or knowledge on the automotive industry.

Cons:

Cost of Auditing Fees. As opposed to paying an internal employee’s typical wage or salary, organizations will have to pay a separate cost to the third-party auditing company. This of course depends on how frequently your organization will be conducting audits; if audits will be conducted monthly, it may be more cost effective to train a full-time internal auditor. If audits are only conducted annually, it may be more cost effective to outsource.

Less Knowledge of Company Culture. Since these auditors will be coming from a third-party, they’ll have less of a deeper understanding when it comes to your company’s culture and work environment. This means that the auditor will have to spend time getting to know your facilities, policies, and employees on an in-depth level.

Conclusion

There are pros and cons to both methods of an internal audit, but there is one definitive conclusion: internal audits are a critical part of implementing and maintaining management systems, meaning they should be carried out with integrity. Whether your organization should train an internal auditor or outsource any auditing services is up to the needs, resources, and timeframe that your company has. Take time to assess these options and make a decision that benefits your business.

The ISO 9001 Group offers Internal Auditor Training as well as Internal Auditing services. Contact us today to learn more about internal audits and what value we can bring to your management system.