Auditing & Quality Control

Purchasing audits help maintain accuracy and accountability in your procurement and inventory processes. TimberCloud provides flexible auditing tools to verify inventory counts, validate receipt accuracy, and ensure vendor compliance.

Plan availability: The Audits area lives inside Purchasing, which requires the Build plan or higher (plus the relevant role permission). The inventory-counting audit types — Inventory, Cycle Count, and Full Physical — are part of the Inventory Audits capability, which requires the Production plan (or Enterprise). Purchase Order, Receipt, and Vendor audits are available wherever Purchasing is. See Subscriptions & Plans for the full feature-by-tier breakdown, and Purchasing for the wider procurement workflow.

Audit Types

When you create an audit, you choose one of six audit types. Each type tailors the form, the related record it needs, and the metrics it tracks.

Inventory Audit

• Verify physical inventory against system records
• Identify discrepancies in stock levels
• Location-specific counting
• Generate variance reports

Requires the Production plan (Inventory Audits).

Cycle Count

• Regular, scheduled partial counts
• Focus on high-value or fast-moving items
• ABC analysis approach
• Continuous accuracy improvement

Requires the Production plan (Inventory Audits).

Full Physical

• Complete inventory count across all locations
• Reconciliation against system value
• Typically performed annually
• Comprehensive verification

Requires the Production plan (Inventory Audits).

Purchase Order Audit

• Verify PO details and approvals
• Check pricing accuracy
• Validate vendor terms
• Compliance verification

Receipt Audit

• Verify received quantities
• Check posting accuracy
• Validate cost entries
• Discrepancy investigation

Vendor Audit

• Vendor performance review
• Pricing verification
• Terms compliance check
• Quality assessment

Creating an Audit

Navigation

1. Go to Purchasing → Audits.
2. Click + New Audit.

Required Information

Basic Details

• Audit Type: Select one of the six types above.
• Audit Date: When the audit is being conducted.
• Status: Defaults to Draft (you can also start a new audit as In Progress or Completed).
• Location: The physical location being audited (required for every type except Vendor).
• Auditor: The user performing the audit (auto-fills with the current user).

Type-Specific Requirements

Depending on the audit type, you'll be asked to link the record being audited:

• Purchase Order Audit: Select the specific PO to audit. The system loads its details and line items.
• Receipt Audit: Select the specific receipt to audit. The system loads its receipt lines.
• Vendor Audit: Select the vendor being audited. (Vendor audits don't require a location.)

For Inventory, Cycle Count, and Full Physical audits, choosing a Location automatically generates the count lines for that location.

Optional Fields

• Scheduled Date: For planned future audits.
• Notes: Initial notes or audit scope.
• Initial Findings: Documented observations.
• Recommendations: Suggested improvements.
• Corrective Actions: Required follow-up actions.

Audit Workflow

Status Progression

┌─────────┐    ┌─────────────┐    ┌───────────┐    ┌──────────┐    ┌────────┐
│  Draft  │ ─▶ │ In Progress │ ─▶ │ Completed │ ─▶ │ Reviewed │ ─▶ │ Closed │
│         │    │             │    │           │    │          │    │        │
└─────────┘    └─────────────┘    └───────────┘    └──────────┘    └────────┘
     │
     ▼
┌───────────┐
│ Cancelled │
└───────────┘

Status Definitions

You can filter the Audits list by any of these statuses, plus by date range.

Performing Audits

Inventory / Cycle Count / Full Physical Audits

When you create an inventory, cycle count, or full physical audit at a location:

1. Line Items Generated

   • The system creates audit lines for each inventory item at the location.
   • Each line shows the expected quantity from the system.
   • A field is provided for the actual counted quantity.

2. Counting Process

   • Enter the physical count for each item.
   • Note any discrepancies.
   • Document condition issues.

3. Variance Calculation

   • The system calculates the difference (Counted − Expected).
   • Significant variances are flagged.
   • Variance is tracked by value.

4. Resolution

   • Investigate discrepancies.
   • Document findings.
   • Recommend adjustments.

Cycle Count audits add an ABC Analysis view (tracking how many A/B/C items were counted), and Full Physical audits add Locations, Count Progress, and Reconciliation views for counts that span multiple locations.

Purchase Order Audits

Verify PO accuracy and compliance:

1. PO Selection

   • Choose the purchase order to audit.
   • The system loads the PO details and lines.

2. Verification Points

   • Approval chain followed
   • Pricing matches quotes
   • Terms properly applied
   • Quantities reasonable
   • Vendor selection justified

3. Documentation

   • Note any issues found.
   • Record recommendations.
   • Identify process improvements.

Receipt Audits

Validate receiving accuracy:

1. Receipt Selection

   • Choose the receipt to audit.
   • The system loads the receipt details.

2. Verification Points

   • Quantities match the packing slip
   • Items match PO specifications
   • Rejections properly documented
   • Stock transactions accurate
   • Location assignment correct

3. Documentation

   • Note discrepancies.
   • Track correction needs.
   • Recommend process changes.

Vendor Audits

Assess vendor performance and compliance:

1. Vendor Selection

   • Choose the vendor to audit.
   • The system loads the vendor's PO and receipt history.

2. Evaluation Areas

   • On-time delivery performance
   • Order accuracy rates
   • Quality consistency
   • Pricing competitiveness
   • Communication responsiveness
   • Terms compliance

3. Scoring and Recommendations

   • Rate performance areas.
   • Document concerns.
   • Recommend actions.

Audit Lines

For inventory-based audits, each line captures:

Working with Audit Lines

• Enter counts directly in the grid.
• Tab through fields efficiently.
• Save progress frequently.
• Mark lines as verified when confirmed.

Audit Documentation

Findings

Document what was discovered:

• Inventory discrepancies found
• Process breakdowns identified
• Compliance issues noted
• Quality concerns observed

Recommendations

Suggest improvements:

• Process changes needed
• Training requirements
• System adjustments
• Policy updates

Corrective Actions

Track required follow-up:

• Who is responsible
• What needs to be done
• When it should be completed
• How to verify completion

Audit Reports

Variance Report

• Items with count discrepancies
• Dollar value of variances
• Variance by location
• Trend analysis

Audit Summary

• Audits completed by period
• Pass/fail rates
• Issues identified
• Actions taken

Vendor Performance

• Delivery metrics
• Quality scores
• Comparison across vendors
• Trend over time

Integration Points

Inventory

Inventory-based audits are linked to:

• Specific locations for counting
• Product options for inventory items
• Discrepancy tracking and variance calculations

See Inventory for how stock levels and locations are managed.

Purchase Orders

PO audits link to:

• Specific purchase order records
• Line-by-line verification
• Approval and compliance tracking

See Purchase Orders.

Receipts

Receipt audits connect to:

• Receipt transactions
• Stock transaction verification
• Receiving accuracy review

See Receiving & Receipts.

Vendors

Vendor audits pull from the vendor's procurement history. See Vendors.

Best Practices

Planning Audits

1. Schedule Regularly: Establish an audit calendar.
2. Prioritize High-Value: Focus on expensive items.
3. Rotate Coverage: Ensure all areas are audited over time.
4. Staff Appropriately: Assign trained auditors.
5. Prepare Materials: Have forms and tools ready.

Conducting Audits

1. Be Thorough: Don't skip steps.
2. Document Everything: Note all observations.
3. Remain Objective: Report facts without bias.
4. Ask Questions: Investigate anomalies.
5. Verify Counts: Double-check significant variances.

Following Up

1. Review Promptly: Don't let audits sit.
2. Assign Actions: Establish clear ownership of tasks.
3. Set Deadlines: Specify dates for completion.
4. Track Progress: Monitor action completion.
5. Re-audit If Needed: Verify that corrections worked.

Continuous Improvement

• Analyze audit trends.
• Identify systemic issues.
• Update processes based on findings.
• Train staff on common problems.
• Celebrate improvements.

Troubleshooting

Audit Lines Not Populating

• Verify the location has inventory items.
• Check that a PO or receipt was selected (for those audit types).
• Confirm inventory is tracked at the selected location.
• Refresh the page after selecting a location.

Large Variances Found

• Recount to verify.
• Check the unit of measurement.
• Look for pending transactions.
• Review recent adjustments.
• Check for location transfers.

Cannot Complete Audit

• Ensure all lines are counted.
• Verify required fields are filled.
• Check for validation errors.
• Confirm the user has permission.

"Audits" Isn't in My Menu

• The Audits page requires the Build plan or higher (Purchasing) plus the role permission. The Inventory, Cycle Count, and Full Physical types additionally require the Production plan. See Subscriptions & Plans to compare tiers.

Historical Audit Not Found

• Search by audit number.
• Filter by date range.
• Check the status filter (the audit may be Completed, Reviewed, or Closed).
• Verify the location filter.