Compliance Audit

Compliance Audit

See Also:
Audit Scope
Charge Account
Managed Sales And Use Tax Audit Programs
How to Control Annual Audit Fees
Role of a Company Back Office
Planning Your Exit Strategy

Compliance Audit Definition

The compliance audit definition is an audit which serves the purpose of ensuring that a company meets the requirements of an outside governing body. It is commonplace in many industries. Any time a company has to meet licensing requirements for a governing body, either governmental or non-governmental, a compliance audit process occurs. This audit is done by either internal or external personnel.


Compliance audits, explained as the method to meeting certification requirements placed upon a business, take place for a variety of purposes. In one instance, governments require compliance audits. These could be for health code, workplace safety, and more. Furthermore, the government requires certification to prove that a business meets the standards of operation it places. Compliance audit guidelines let the business know how it can best plan for this.
For non-governmental organizations, compliance audit solutions are equally as common. These serve the purpose of gaining certification through networking groups, industry groups, customer advocacy organizations, and more. As an example, the better business bureau has a certification process for qualified businesses. Furthermore, companies require a compliance audit methodology to be better business bureau certified.

Compliance Audit Example

For example, Don is the manager of a major chemical plant. This business, dealing closely with the major petroleum companies, has many requirements for operations.
Recently, Don’s business is due for workplace safety certification. This certification requires close scrutiny from government agents and therefore, it will not be easy to pass. To prepare for this, Don hires an outside consultant to perform a compliance audit. This audit will clearly spell out, through an after-audit report, how the plant must improve to meet governmental requirements. Included in the price is a compliance audit handbook with detailed instructions on the requirements of the license.
After Don’s compliance audit process, he is thrilled; his company has to make only a few inexpensive changes. Don is happy that his company protected profits by hiring a well trained expert for help. In conclusion, passing this test will lift a huge weight off of his shoulders.

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compliance audit
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