When you’re in the midst of a problem.
I recently spoke to an IT professional who was struggling to restore a new client's server after they had a massive data loss. Like many companies, they had created a backup plan for their company's data, but they never went through the process of restoring their backed-up data to make sure it worked properly. Unfortunately, they learned too late that it did not.
There’s a corollary to this for exporters: The worst time to be thinking about how to handle an audit is when an agent from the Office of Export Enforcement shows up at your door.
This year, make it different. Make it a priority to audit your company's export compliance procedures before an issue arises. Here’s what you need to know to get started.
An internal audit is part of a strong Export Compliance Program (ECP). If you have an ECP, but you’re not following it, it’s a waste.
Don’t have an ECP yet? Stop what you’re doing right now and start creating one.
Just as your written manual is the basis of your compliance training program, your export compliance audit plan is an important subset of that plan that goes into even greater detail. By including pertinent policies and step-by-step procedures, you'll prepare your company and employees for the unknown and feel confident in your process should you ever be subject to an export compliance audit.
You and your staff need to discuss a plan detailing what you will do if you are audited. An internal audit helps demonstrate that you’re doing your due diligence. It’s not enough to create an ECP—you must show that you’re following it.
There are three major components to include in your plan:
You can find out more about doing your own audit in our article Surviving an Export Compliance Audit: 3 Key Steps.
An audit of your company’s export procedures will show you who’s doing what they’re supposed to, who’s not, and what types of training you need to provide to make sure your whole office is on the same page.
Another aspect to consider: Things change. Products change, regulations change, trade terms change, customers change, employees change. Nothing in business stays the same forever, nor should it!
Internal audits help you see what’s working well and help you gauge the current reality of your business. You can then make any necessary changes to adapt your business to best practices.
In addition to your internal staff, audits give you an opportunity to evaluate your external partners and processes in order to hold them accountable. This includes:
In addition to partners, there are specific processes you should be auditing. These processes include:
There’s no one-size-fits-all answer to how you should audit your company’s export procedures, but there are two important options.
The internal audit is a do-it-yourself method that helps you get your hands dirty and work through the process of what your company’s procedures should be and how they should be measured.
If you don’t know exactly how to get started, the right way to audit, or the best metrics to use, an external audit may be helpful to you. A third party or consultant, for example, ensures a fresh set of eyes and objectivity so you can see how to improve your processes (even if they are working).
How frequently to audit your company’s export procedures depends on the size of your company, your volume of exporting, and your risk tolerance. Big companies should perhaps do this quarterly (three times internally and once externally). Smaller companies should audit internally once a year and then bring in an outside person once a year (or every other year). Whatever you decide should be detailed in your ECP.
Following your self-audit, you should make sure to update your documentation. If something is onerous, you should make the change to the audit checklist, your ECP, or both.
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