One particular on the crucial emphasis of internal audit will be to review no matter if your audit client has proper approach in spot to evaluate the suppliers.
Unfavorable occasion in any aspect on the provide chain will leads to disruption for the distriubtion of items to end-customers effectively. It's important to guage the suppliers to make sure that they've the capability and stability to conduct sustainable enterprise along with your audit client on a long-term basis.
On a perfect basis, management/ procurement of the audit client need to possess a formal policy on the complete approach of evaluating suppliers. The assessment must be created and documented within a right format.
As an example, a background examine on the suppliers is expected (e.g. would be the supplier a subsidiary of any congolmerates, would be the supplier financially sounds). A different crucial document would be the economic statement on the supplier. This can be to make sure that supplier is financially stable to operate on a going concern basis.
