Saturday, July 29, 2023

AUDITORS - BE AWARE WHEN YOU'RE AUDITING CONSTRUCTION INDUSTRY

Just had some "difference of opinion" with auditors requesting the project procedures involving design (related to the drawings), the project execution plan (consultant), method statements (consultant) which are all literally spelled in the contract (contractual requirements) to be changed totally.

Recommendation to change these documented information would result in contract changes and review, may also inadvertently causing breaches in the contract terms and conditions between the client, the consultant and the contractor. To make it worse, it can potentially be costly to disturb the construction operation that is running smoothly.

The client fiercely objected when contractors calling them. I had to intervene before the client thought of suing.

Had to explain in detail to the auditors whilst they reserve the right on the corporate level documentation for the purpose of complying to the certification, but requesting to "dump" and use different formats already stated as contractual procedures, execution plan especially method statements are not acceptable.

They can recommend and note as observations in their exit/closing meeting though. I managed to calm down the client/consultant from questioning the auditors qualifications and experience although I notice that these are valid concern.

Although having referring to their superior, and confirmed that they have made some mistakes - even withdrawing some "ridiculous" NCR, it would have been costly for the client, consultant and contractor.

Please be aware of these sensitive issues when you're auditing. Remember, do not resort to some "forensic investigating techniques" or "too authoritative principles" in auditing.

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