A Supplier Audit Report Template for the FDA-Regulated Industries

In FDA-regulated industries such as pharmaceuticals and medical devices, supplier audits play a crucial role in ensuring the quality and compliance of products throughout the supply chain.

A well-structured and comprehensive audit report is essential for communicating findings, identifying areas for improvement, and demonstrating due diligence to regulatory authorities.

This guide will walk you through the key components of an effective supplier audit report, providing context, insights, and best practices for each section and clarifying example excerpts from our own supplier audit report template.

Looking for more audit and inspection readiness best practices? Watch our recent interview with Divya Gowdar.

1. Title Page

The title page serves as the first impression of your audit report. It should be professional, clear, and contain all the essential information at a glance.

Key points:

• The title should be specific, e.g., "Supplier Audit Report for [Supplier Name]" rather than just "Audit Report."
• Including the auditor's qualifications (such as RAC - Regulatory Affairs Certified) demonstrates the credibility and expertise of the person conducting the audit.
• The date on the title page should reflect when the audit was conducted, not when the report was written, to provide context for the findings.

2. Certification Statement

This section acts as a formal declaration of the report's authenticity and the auditor's involvement.

The certification statement serves a legal purpose, establishing the auditor's responsibility for the contents of the report. It should be concise but comprehensive, covering the key aspects of the audit activity. This statement can be crucial if the report is ever used in legal proceedings or regulatory inspections.

3. Audit Details

This section provides the essential context for understanding the scope and nature of the audit.

Specifying the type of audit (e.g., Supplier Audit) helps set expectations for what the report will cover. Citing the relevant regulations (e.g., 21 CFR Part 820 and 211) demonstrates that the audit was conducted against recognized standards.

Including the duration of the audit and the number of employees indicates the depth and complexity of the assessment. This information helps readers understand the context of the findings and recommendations.

4. Audit Scope and Objective

Clearly defining the scope and objective is crucial for framing the entire audit report.

• The scope should be specific and bounded. For example, "all quality systems with emphasis on those systems most likely to affect the [Client] products" gives a clear focus.
• The objective should be aligned with regulatory requirements and the client's needs. For instance, "To determine compliance with FDA rules for storage and distribution of pharmaceuticals and medical devices" sets a clear purpose.

This section helps manage expectations about what the audit does and does not cover, preventing misunderstandings later.

5. Management Summary

The management summary provides a high-level overview of the audit findings for busy executives or stakeholders who may not read the entire report. This summary often informs high-level decision-making, so it should be written with care and precision.

This section should be concise but comprehensive, highlighting the most significant findings and their implications.

It's important to provide context for the findings. For example, noting that the firm is not FDA-registered helps frame the recommendations appropriately.

The tone should be balanced, acknowledging both strengths and areas for improvement.

6. Key Functions and Key Personnel

This section introduces the main actors involved in the audit process and the supplier's operations.

Listing key personnel demonstrates the involvement of appropriate levels of management in the audit process. It provides context for who is responsible for different areas of the operation, which can be helpful when assigning follow-up actions.

This section can also give insights into the organizational structure of the supplier. When writing this section, be sure to respect confidentiality and only include necessary information.

7. Discussion of Various Operations

This is typically the most substantial part of the report, providing detailed insights into the supplier's operations.

Organize this section logically, perhaps following the flow of operations or the structure of the quality system. For each area (e.g., Corporate Security, Operations Review), provide:

• An overview of the process or system
• Key observations
• Any notable strengths or best practices
• Areas of concern or opportunities for improvement

Use specific examples to illustrate points, but avoid including unnecessarily sensitive information. This section should provide a clear picture of how the supplier operates and how well their processes align with regulatory requirements and industry best practices.

8. Documents Reviewed

This section provides an audit trail of the evidence examined during the audit.

Listing reviewed documents demonstrates the thoroughness of the audit and provides context for the findings. For each document, include:

• Document name and number
• Version or date
• Brief description of content
• Any significant observations or discrepancies

This list can be valuable for follow-up audits or the supplier when addressing findings. Be sure to note if any requested documents were not available, as this could be a finding in itself.

9. Audit Findings (Recommendations)

This is often the report's most critical section, detailing the issues identified during the audit.

Categorize findings clearly (e.g., Major Nonconformity, Minor Nonconformity, Opportunity for Improvement) and explain what these categories mean.

For each finding, provide:

• The specific requirement or regulation that wasn't met
• A clear description of the observation or evidence
• The potential impact or risk
• Recommendations for addressing the issue

Use objective language and avoid assigning blame and focus on the process or system, not individuals.

Ensure that findings are traceable to specific evidence or observations. Recommendations should be practical and aligned with regulatory expectations.

10. Conclusion and Auditor's Signature/ Date

The conclusion summarizes the overall results of the audit and provides a final assessment.

• Restate the main objective of the audit and how well it was met.
• Provide a balanced summary of the supplier's strengths and areas for improvement.
• If appropriate, include a statement about the supplier's suitability as a vendor.
• Avoid introducing new information in the conclusion; it should synthesize what's already been presented.
• The tone should be constructive and forward-looking, emphasizing opportunities for continuous improvement.

This final section authenticates the report. The signature affirms the auditor's responsibility for the contents of the report. The date here should be when the report was completed, which may differ from the audit date.

A Few Best Practices for Supplier Audits

1. Objectivity state your observations.

Before finalizing each observation, ask yourself, "Can this statement be objectively verified by another auditor?" If not, rephrase it to focus on observable facts.

Maintain a neutral, fact-based tone throughout the report. Avoid emotional language or subjective judgments. Instead, focus on observations and their potential impact on quality and compliance.

2. Be crystal clear—leave nothing to interpretation.

Clarity involves not just simplifying complex concepts, but also structuring information logically and providing context where necessary.

Use clear, concise language that can be understood by various stakeholders, including those who may not have technical expertise in the audited areas. Define any industry-specific terms or acronyms used. Avoid rriting overly long, complex sentences that obscure the main point.

Have someone from a different department review your report. If they can understand the key points without additional explanation, you've achieved good clarity.

3. Provide concrete examples and evidence to support findings.

Common pitfalls we see here include:

• Making broad, sweeping statements without supporting evidence.
• Failing to quantify observations where possible (e.g., "some records were missing" instead of "3 out of 20 records were missing").
• Not providing enough detail to allow for targeted corrective actions.

Specific, concrete examples in audit reports serve multiple purposes. They provide clear evidence for findings, offer a precise focus for corrective actions, and demonstrate the depth and thoroughness of the audit process. Specificity also helps track improvements over time and compare performance across different audits or facilities.

Instead of saying "documentation was inadequate," specify what was missing or incomplete. For each observation, including the "5 W's" - What was observed, Where it was observed When it was observed, Who was involved, and Why it's significant (i.e., what requirement it violates).

4. Ensure all information in the report is pertinent to the audit scope and objective.

Extraneous information can dilute the impact of important findings. For each section of your report, ask, "How does this information help the reader understand the state of compliance or quality at this facility?" If you can't answer this question clearly, consider omitting or revising that section.

5. Address all areas within the audit scope, even if no issues were found.

This demonstrates thoroughness and can highlight areas of strong performance. We suggest creating a checklist based on your audit scope and ensuring that your report addresses each item on this list, even if only to state that no issues were found in that area.

6. Use consistent terminology, formatting, and rating scales throughout the report.

Consistency in audit reporting is crucial for several reasons. It allows for easy comparison between different audits or time periods, ensures fairness in how observations are reported and categorized, and makes the report easier to navigate and understand. In FDA-regulated industries, consistency also helps demonstrate a systematic approach to quality assessment.

We suggest developing and using standard templates and rating scales for all your audits. Have a peer review process to check for consistency across different auditors' reports.

7. Ensure that all findings can be traced back to specific regulatory requirements or company procedures.

Traceability in audit reports creates a clear link between observations, regulatory requirements, and company procedures. This is particularly important in FDA-regulated industries where demonstrating compliance is crucial. Traceability also facilitates the development of targeted corrective actions and helps in defending audit findings if challenged.

We sometimes encounter teams making general references to regulations without citing specific clauses, failing to link observations to the auditee's own procedures or quality system requirements, and not providing enough detail about the evidence that led to a finding.

For each finding, create a traceability matrix that links the observation to specific regulatory requirements, company procedures, and the evidence observed during the audit.

8. Frame recommendations in a positive, improvement-oriented manner.

constructive approach in audit reporting shifts the focus from blame to improvement. This is essential for fostering a positive relationship with the auditee and encouraging genuine efforts to address issues. Constructive recommendations can drive meaningful enhancements to quality systems in FDA-regulated industries, where continuous improvement is a key principle.

9. Respect the sensitive nature of audit findings.

Respecting confidentiality in audit reports is crucial for maintaining trust with the auditee and protecting sensitive business information.

In FDA-regulated industries, where proprietary processes and formulations are common, breaching confidentiality can have serious legal and competitive consequences. However, this must be balanced with the need to provide sufficient detail for meaningful corrective actions.

Establish a clear confidentiality agreement before the audit and have a process for the auditee to review the report for potential confidentiality issues before finalization.

10. Complete and submit the audit report promptly.

Timely submission of audit reports is critical for several reasons. It ensures that findings are still relevant and actionable, allows for prompt implementation of corrective actions, and demonstrates professionalism and efficiency.

Delays can lead to missed opportunities for improvement and could be problematic if quality issues arise in the interim.

We recommend setting internal deadlines for each stage of the report writing process (e.g., first draft, internal review, auditee review, final submission) and tracking progress against these deadlines.

Interested in putting a comprehensive supplier auditing program in place? We can help.

Our certified, experienced auditors plan, schedule, and execute vendor/supplier quality management audits to identify areas of conformance and nonconformance with applicable global regulations. Following assessment, our experts provide a detailed report including all observations, deficiencies, and a risk-based corrective action plan for improvement.

With an enhancement plan in place, our quality professionals will work closely with you to provide recommendations, resolve compliance issues, track corrective actions, and communicate the status of resolutions with company management.

This comprehensive approach to vendor/supplier quality management strengthens your vendor/supplier relationships while ensuring your products are of the highest quality through a quality system that is compliant and efficient.

Our vendor/supplier auditing services include:

• Vendor/supplier audit plan strategy and creation
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