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Thread Title: I'm looking for an audit program for scrap materials.
Created On Monday January 08, 2007 10:17 AM
  I'm looking for an audit program for scrap materials.
  I'm looking for an audit program for scrap materials.
  I'm looking for an audit program for scrap materials.
  Obsolete parts
  Scrap Sales
  Scrap Sales


dgreen


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Monday January 08, 2007 10:17 AM

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I know this is a bit of a stretch but I've searched online to include Auditnet.org and have come up with nothing for an audit program on scrap materials. Any help would be greatly appreciated. Thanks.

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Buddie


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Monday January 08, 2007 1:09 PM

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It has been a while since I was in manufacturing, but I will list concerns I remember with the assumption that you are not auditing a dealers' procedures but instead your company as a scrap customer:

1. Consider having truck go through certified scales for every trip to scrap dealer or at least for your audit because sometimes the dealer told us the weight and we had to trust them
2. Has metal been segregated by type since prices by type metal vary or does dealer pay a blended price that may be paying you too little
3. I have seen scrap dealers pay in cash and have no way to confirm amount paid is correct or all of it was turned in
4. Theft at storage site by employees if not secured physically
5. Contractors sometimes take their scrap back to sell when you have paid for it and it should be left at your place of business for you to sell
6. Gate passes should be reviewed if they document what left the grounds, found sale of scrap that had not been turned in to petty cash, driver forgot to turn in if you can believe that
7. Find out scrap prices if possible from other sources and compare to dealer's prices
8. If trailer is dropped off at site until full see who pays for trailer or if any unusual arrangements are being used

Hope this helps. Buddie

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dgreen


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Monday January 08, 2007 5:56 PM

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Thanks Buddie. That definitely helps.


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JanetFike


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Tuesday January 09, 2007 5:04 AM

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Don't know if this would apply to your scope, but when I've done scrap audits, I also looked at obsolete parts to see if they were properly sold as scrap and monies recovered.

If your co has parts inventory (or any metal inventory, for that matter), perhaps the sale of obsolete parts should show up in scrap sales (depending on your business).

Lack of such activity in scrap sales raises two red flags for me:
1. inventory may not be properly aged & the obsolete inventory sold (reduces warehousing costs and generates a bit of revenue)
2. if there *is* an inventory aging program in place, how are obsolete items disposed of and where is the potential revenue going, if not to scrap sales? (pocket of warehouse mgr?)

Just food for thought...

Edited: Tuesday January 09, 2007 at 5:05 AM by JanetFike

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parkermantoo


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Monday April 14, 2008 11:11 AM

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I haven't been able to find an effective audit program for scrap sales either.
If you come across one please advise----I'll do the same.


Thanks!!!!!

-------------------------
C Veeck

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bt


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Wednesday April 16, 2008 9:55 PM

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What you need to look at will vary a lot depending on what are the scrap materials. These articles describe a couple of different ways things can go wrong:

http://query.nytimes.com/gst/fullpage.html?res=9F0CE7D81331F933A0575AC0A965958260&sec=&spon=
http://findarticles.com/p/articles/mi_pjus/is_200401/ai_2883178513


These are very good sites that can guide you and you may be able to find a contact to discuss what is specific to your company:
www.scrap.org
www.isri.org/ look specifically for a report on "Recommended Practices and Procedures for Minimizing the Risks of Purchasing Stolen Scrap Materials."


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DISCUSSIONS > IIA GENERAL DISCUSSION AREA [ REFRESH ]
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