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KMH helps companies in many industries review how the organization’s management and its operating procedures are functioning with respect to their effectiveness and efficiency in meeting stated objectives.  Going through the operational audit process provides a company with objective opinions. Those opinions often generate quicker production or sales turnaround, better allocation of costs, improved control systems, the location of areas of delay and an overall streamlined workflow.

Businesses can get a good idea of how they are doing in operations by examining company data on their own. However, sometimes those close to the company don’t review this data completely objectively or are so familiar with operations that it is difficult to come up with other approaches to finishing work.

Checklist items often include relationships with suppliers and staff, inventory management and control, alternate sources of raw materials, and all items involved in product creation, ongoing maintenance procedures, production-employee training programs, processing procedure documentation and the use of the best available technology.

Objectives

∙ Appraise the effectiveness and efficiency of a division, activity, or operation of the entity in meeting organizational goals.

∙ Understand the responsibilities and risks faced by an organization.

∙ Identify, with management participation, opportunities for improving control.

∙ Provide senior management of the organization with a detailed understanding of the result

KMH can assist managers to use the operational audit to evaluate and analyze the current effectiveness of the company’s operations while identifying areas of potential improvement. The identification of areas requiring improvement is a key aspect, as the fundamental purpose of the operational audit is to improve effectiveness for all operations.

The types of activities that might be audited vary between businesses, but some examples of processes that are common to many companies include purchasing, receiving and shipping stock, data processing and logistics.