HSE Auditing

by
Adebiyi Adeleke Adeosun
Paradigm Environmental System
Consultants,
Lagos.
 Why is HSE Audit becoming popular?

• Increasing corporate sensitivity to HSE problems

• Increasing complexity of the regulatory programs

“Corporate managers wants to verify the quality and

effectiveness of their firms HSE MS- processes and
procedures”
 Why is HSE Audit becoming popular?

HSE Audits are defined as a systematic,

documented, periodic and objective review of facility
operations and practices related to meeting HSE
requirements

“they are different from regulatory agency

inspections in that they are performed by or on
behalf of the regulated entity, and deal with broader
concerns than compliance with a single regulatory
program
 Audits can be modified to
achieve following objectives
• Identification of both regulated and unregulated
risks to health and environment associated with
processes and operations conducted on site

• Identification and evaluation of opportunities for

waste minimisation

• Identification and planning and budgetary purpose,

of those control investment necessary to meet
anticipated regulatory developments

• Identification and evaluation of risks and liabilities

involved in past on site and offsite disposal
practices
 Audits can be modified to
achieve following objectives
contd.
• Assessment of facilities emergency response
capabilities

• Identification and evaluation of regulatory

requirement and potential liabilities associated
with major modification to existing facilities

• Compliance with regulatory requirement

 Audit- a process which
…. Collects, analyse, interprets and documents
information sufficient to achieve objectives
…..includes specific procedures to promptly prepare
candid and appropriate written report on findings,
corrective action, schedule and implementation
……quality assurance procedures to assure the accuracy
and thoroughness through supervision, independent
internal review and evaluation
 Two main criteria for effective
audit
• First, audit should be designed to be as
comprehensive as possible given the specific
objectives in
– Identifying activities and
– Conditions
Which could have adverse effect

• Second, it should not be seen as a one-time-only

occurrence but as an integral part of the rational
management process that includes evaluation of
any problem identified in terms of potential
consequence

Given these two criteria, a good audit should be

multidimensional
•Compliance
• risk evaluation
 Essential Element of an
Effective Audit
• Top management support and commitment to
follow up on audit findings
• Simple and manageable audit process
• Utilisation of in-house personnel where
possible
• Appropriately trained staff
• A standardised approach
• Specific audit program objectives, scope,
resources and frequency
 Contd.
• Sensitivity to confidentiality
• A process that obtains appropriate and
sufficient information
• Procedures for documentation of findings,
follow up on corrective action of schedule
for implementation
• A process that includes quality assurance
procedures to ensure the accuracy of audits
 ITEMS ORGANISATION
AUDIT
CONSIDERED AFFECTED
TYPE

COMMITTMENT Top
MANAGEMENT POLICIES Management
ORGANISATIONAL EFFECTIVENESS

Middle
RESOURCES
Management
REPORTING LINES
• Operations
FUNCTIONAL PROGRAMS AND PERMITS IN PLACE
• Facility
TRAINING PROCEDURES • HSE
QA/QC

PROCEDURAL PRACTICES Direct Labour

RECORD KEEPING PRACTICES • Operations
TRAINING /AWARENESS • Facilities
INSPECTION
HOUSE KEEPING
PHYSICAL COMPLIANCE OF FACILITY
 Pre Audit Activities
• Select activity or activities to be audited
• Ensure top management commitment

• Select audited objectives

• Define audit scope

• Select audit team

• Ensure independence and objectivity

Plan
• Define roles and responsibilities
• Ensure top management commitment

Prepare audit team

• Understand activities and management system
• Review previous audit/review

• Prepare questionnaire
• Review questionnaire
• Develop checklist
 On site Activities

• Discuss with personnel on site

Carry out a SWOT Analysis

• Determine standard

Gather evidence
• Inspect activities, processes
• Review documents

Evaluate findings
• Determine performance
• Check for non conformances

Prepare audit findings and conclusions

Post Audit Activities

Prepare Audit Report

Communicate to the company
 Follow Up

Audit follow up
•Develop corrective action plan
•Establish mechanism to ensure
follow up
HSE Management System Aspects

• Corporate Policy
• Standard Operating Procedures
• Organisational Assignment of
responsibilities/authority
• Internal Inspection and evaluation system
• Reporting system
• Training and continuing education
• Planning
 Types of Audit
• Regulatory Compliance Audit (RCA)
• Process Safety Audit
• Occupational Health Audit
• Product Quality Audit
• Liability Audit
• Management System Audit
 Assessing Strength and
Weakness
• Compile a list of issues from the
questionnaires
• Rank issues in terms of risk
• Compare obtained response with
– Policy objectives
– Regulatory standards
– Self-set targets
– Industry best practices
 Internal Audit Program
• Definition

A relatively inexpensive proactive

approach to staying on top of HSE
regulatory onslaught, while keeping
current with technological practices
 HSE Audit

…. is a means of measuring the performance

of HSE activities or practices at a facility
against some standards or commitment
 Standards?
“Standards” – generally written
documents accepted by or imposed
upon program management.

These documents then serve as

yardsticks of measurement of
performance
 Standard
Standards could be anything from
– Federal
– State
– Local
– Codes
– Regulations to be established from engineering specs
– Standard Operating Procedures (SOP)
– Good management practices
– Corporate or departmental policies
– or just plain “common sense”
 Sufficient and reliable
information
• Factual
• Adequate
• Convincing
• Consistent
• Candid
• Clear
Through the use of appropriate techniques in
– Interviewing
 Why Internal Audit
“ If an appropriate effort is initiated by
a facility for internal audit, then the
facility should adequately be prepared
for external audit.

Audit is a tool.
 Audit a tool?
• Management Tool
– Appraisal of current compliance
– Improvement of corporate image
– Early warning device for impending
problems

• Training Tool (Dry run)

– Increasing overall level of awareness
 Audit a tool? (contd.)
• Risk Management Tool
– Improvement of risk management system by
reducing HSE risks and liabilities
• Management accounting Tool
– Control of compliance cost
• Line Management Tool
– Improvement of overall performance at
operating level
 Audit a tool? (contd.)
• Program-wide Tool
– Development of proactive management
program for optimising resources
• Bottom-line Tool
– Reducing/elimination of non-compliance
conditions and fines due to violation
 Points to note!
Do not execute an internal audit of a facility
unless top management intends to correct
all non-compliance conditions or provide a
reasonable schedule for implementation of
corrective actions.

Audit documents are tenable for criminal

prosecution of individual as well as citation
and fines against corporations
Once an audit of a facility is conducted
and documented, the documentation
can, under certain circumstances, be
requested by regulators
 Basic Audit Tools

• The S/H/E audit process is most

commonly supported by some important
tools: the audit protocol and the
working papers.

Audit Protocols

• Names for the various documents that

guide the auditor while conducting the
audit include audit protocols, audit work
programs, review programs, checklists,
and audit guides.
• An audit protocol represents a plan of
 Audit Protocols……..
• An audit protocol also provides the basis
for assigning specific tasks to individual
members of the audit team, for comparing
what was accomplished with what was
planned, and for summarizing and
recording the work accomplished.

• A well-designed audit protocol can also be

used to help train inexperienced auditors
and reduce the amount of supervision
required by the audit team leader.

• The audit protocol itself is a listing of

auditing procedures that are to be
performed to gain evidence about safety,
 Who performs the audit ?
Basic qualities/skills of any auditor
• Knowledge of auditing process
• Knowledge of all applicable regulations and
standards
• An independent viewpoint
• Familiarity with facility history and
processes
• Knowledge of corporate policy
• An understanding of facility organisation
• Knowledge of facilities management
philosophy
 Use of consultants
Advantages

• Experience in auditing process

• Current expertise in multiple regulatory
programs
• Obtaining an impartial survey of facility
• Quick turn around time
• Minimal time spent and involvement by
facility personnel
 Review all materials obtained
• All materials received must be
– Thoroughly and critically reviewed

• Design and develop follow up question where

necessary information is missing or poorly
communicated

• Identify
– Key players
– Key issues
– Types of facilities
– Programme Strength and Weakness
 Preparation of Working Papers
• Prepare a pre-visit questionnaire
a) List items to be provided to the team for review which may
include
• Permit

• Inspection/Training records

• Analytical data

• Site inspection
b) A list of the questions to be answered concerning
• Organisational chart

• Resource allocation

• Assigned responsibilities

• Physical plant layout

Make responses simple – Yes or No or Not

Applicable
 Preparation of Working Papers

Lastly, send out pre-visit questions to the

operations to be audited to be accompanied by an
appropriate letter from the top management to
announce the HSE audit
• topic
• issues
• timing
 List of departments that must
be involved in the HSE Audit
• Management
• Operations
• Maintenance
• Legal
• Purchasing
• HSE
• Facility Support Engineering
• QA
• Emergency Response
 Basic Structure of a well
executed audit
• Pre Audit
• Field Visit
• Post Audit
• Follow-Up
 Pre Audit Activities
• Determination of goals and objectives
• Selection of targets, subject and scope (Scoping
meeting)
• Plan and Schedule (Planning meeting)
• Preparation (checklist, questionnaires)
• Kick off (Pre visit exchange of information)
• Review of materials recieved
 Objectives
Objectives are created by top management

They may be part of

– compliance order
– Consent decree
– Settlement agreement with regulatory agencies
 Audit Objectives
Determine conformance of the HSEMS
with the audit criteria

To determine whether the HSEMS has been

properly implemented and is being
maintained
Audit Objectives

To identify areas for potential improvement

Assessment of the internal management

reviews process to ensure continuing
suitability and effectiveness of the HSEMS
 Objective Evidence
Objective Examination of system documentation
evidence

Interview, demonstrating
“First hand” training, understanding and
evidence, based competence
on witnessed
facts, not Observation of actual practice
supposition, or physical evidence
presumption, demonstrating
hearsay, rumour, compliance/control
conjecture etc Records (data, lists, report)
demonstrating compliance/
capability/ performance
 Records…
• OS&H Policy
• Safety organization chart
• Training Records on safety, fire and first aid
• Accident investigation reports
• Accidents and dangerous occurrences-
Statistics and analysis
• Records of tests and examination of
equipment and structures
• Safe operating procedures for various
operations
 Contd.
• Record of work permits
• Record of monitoring of flammable and
explosives
• Maintenance and testing records of fire
detection and fire fighting equipment
• Medical records of employees
• Records of industrial hygiene surveys(noise,
ventilation, illumination levels, airborne and
toxic substances, explosive gases)
• MSDS
 Contd.
• Onsite emergency plans and record of
mockdrills
• Records of waste disposal
• Records of effluent discharge to the
environment
• Housekeeping inspection records
• Minutes of Safety committee meetings
• Approval of layouts and other approvals
from statutory authorities
 Contd.
• Records of any modifications carried out in
plant and process
• Maintenance procedure records
• Calibration and testing records
• Shutdown maintenance procedures
• In service inspection manuals, records
including that of material handling
• Safety Budget
• Statutory Records, Previous audit reports,
Transportation of Hazardous substances
 Strategy
This is the guideline to accomplishing
objectives

It may be:
– Assess organisational effectiveness
(management audit)
– Assess facility operational effectiveness
(facility audit)
– Assess facility condition (physical inspection)
 Frequency
This is dependent on
1. The activity type or industry
2. Internal/External pressure
3. Program conditions

It may be a yearly (annual), two-or-three

year cycle program or optionally
1st year – occupational health audit
2nd year – safety audit
3rd year – Behavioral safety audit
 Scope (select Target,
Subject,)
• Target
– Small aspect of a facility
– Entire facility

• Subject
This may be regulatory or self
assessment program
 Depth
Once target and subject is set, a decision
must be taken on the depth and breadth of
efforts

A detailed look at all documents related to:

–Management strategy
–QA
–Maintenance system
–HSE records

could be undertaken
 Plan and Schedule
Good communication is critical here.
• Inform auditees of
– Purpose
– Extent of involvement
– Schedule
• Plan and know
– Who is auditing what
– Who or what authorises the audit
 Plan and Schedule
Be sensitive of operational schedules-
Do not waste people’s time

Have an estimate of time needed to

visit site and look over document, then
double it.

Finally, stick to your schedule.

 Reporting Findings
• The report should follow the below format
– A brief introduction
• Purpose
• Authority
• Strategy
• Terms of Refefence
• Scope
– Report of the site/facility inspection
• Evaluation of records
• Non compliances/Conformance
• Areas for improvement
• Conclusion
 Reporting Findings

• Recommendations

• Follow Up Action Plan

The report should have an executive

summary where a synopsis of the entire
report is included
 Post Audit Activities
• Corrective Action
– Documentation of Action Close-Out
– Documentation of Action Plan

• Development of Critical Success Factor (CSF)

– Commitment
– Allocation of Resources
– Budget

• Follow Up and Verification (Cross Functional)

 Evaluating Finding and
Result
• Rules
– Do not draw unsubstantiated conclusions
– State the exact nature of the problem
– Avoid generalisation
– Use familiar terminologies
– Communicate extent of the problems
• Compliance
• Non compliance
 Evaluating Finding and
Result
• Follow the below steps
– Priorities the problems/impact
– Allocate responsibilities
– Develop an action plan
– Implementation of the plan
– Assess the effectiveness of the plan and
recommend change where necessary
– Document and communicate
 Conducting and audit (types of
information)
Verbal
Interviews
Physical
Site visit &
Objective
Evidence Documentary
Observations

Reviews
Circumstantial

Anecdotal
 Collecting audit evidence: Document
review
Records of complaints
and prosecution
Procedures and
work instruction HSE Case/HSE MS
Documents to
Previous audits
reviewed include
and inspection
reports Process flow
diagrams
Legal documents-
permits, waivers Site and plant layout
plans and diagrams
EIA, EER report
Incident records
Monitoring data
Training records
 Collecting audit evidence:
Site visit
Waste storage and
Chemicals and
disposal facilities
drum storage

Accident & Emergency

Examples of areas procedures and
to focus on during activities related to
site visit actual or potential
hazards

Points of
discharge to
surface water Diesel storage
General area
housekeeping
 Audit findings
The audit team must review all of the
audit evidence to determine whether
the HSEMS conforms to audit criteria

Nonconformity issues are properly

documented in a clear and concise
Audit way and are supported by objective
finding audit evidence
s
The audit findings needs to be
reviewed with the auditees

The audit findings should be agreed

between the auditors and the auditees
 Audit findings
Major non-conformances

Audit
finding Minor non-conformances
s

Observation
 Legal Issues and Protection of Audit
Document
States:

• The attorney-client privilege

• The work-product privilege

• The self evaluation privilege

 Gathering Audit Evidences-
Field visit
Arrange a meeting or preferably informal
session with each group
–Explain the purpose
–Authority
–Confidentiality agreements
–Facility to be audited
–Documents to be surveyed

Establish good rapport.

 Gathering Audit Evidence-
Review
program/documentations
• Present previous findings
• Interview with pre-designed
questionnaires
• Questions must be in three parts
– Management (policies/resources)
– Senior management (system)
– Technical questions (procedures,
process, guidelines)
 Out briefing
Two separate sessions
– Management must be briefed first
– All other key participants should be invited
to a general facility outbriefing

Outbriefing should be brief normally (15-

30 mins)

Review
• Good highlights
• Bad highlights
 Outbriefing

Take note of areas for improvement and stress

that they are general impressions and that more
detailed comment will be produced in an indepth
report.