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1. Q.1 Enlist the types of Audits and explain each type briefly.

12. Q.2 Define Audit Evidence? List the factors affecting Internal Audit
Evidence.
Audit evidence is the data or the information collected by auditors to review a company’s
financial reports and transactions. The reports may need to be verified to prove their
authenticity, which can be conducted by the Auditor or the Certified Public Accountant
(CPA). Hence, evidence is required to ensure the authenticity of these reports.
Audit evidence is usually considered sufficient when the company’s claims, which they
make in the financial statements and their adherence to the accounting laws of their
country’s legal framework, are at par. Without any proper audit evidence, the entire audit
process cannot be completed. Hence, such proof is required to complete the task.
What are the sources of Audit evidence?
Physical Observations: Auditors verify the tangible and intangible assets through
inspections and on-spot observations. This is typically conducted during inventory audit
procedures.

13. Original Source Document: This means vouching of the claim made by the financial
statements of the company to the original documents. The Auditor conducts this through
verifying the claim against any asset by comparing its sale invoice.
External Data: Certain company assets may be actively traded in the financial markets. In
these cases, it should be noted if these assets are reported at a lower cost or the market
value in the given financial statements. The characteristics of audit evidence become
important in these situations.
Recalculations: All the recorded documents and transactions are submitted to the Auditor
based on which they make the financial statements, which then get compared to the
company’s financial statement. The stated process is called recalculation
• Factors that Influence the Reliability of Audit Evidence
All the factors that influence the reliability of audit evidence are listed below:
1. Relevancy: The relevancy of the Audit evidence is largely influenced by the type of audit
evidence being conducted and how to the point the information is received, in comparison

14. To the overall analysis.
2. Source: It is one of the major factors that influence the reliability of the audit evidence.
External source information will always be preferred over any internal information because it
is generally considered void of any bias.
3. Nature: Audit evidence is usually considered sufficient when the information is provided
through presentations, physical confirmation, or legal documents.
4. Sufficiency: Audit evidence also takes into account the material provided, such as bank
statements, which further help determine the financial position of the company.What are
the sources of
5. Audit evidence, when obtained from outside the corporation or the firm through
independent sources, is considered more reliable.

15. 6. One of the most critical factors influencing the reliability of Audit evidence is the form in
which it is recorded. If it is recorded in documentary form through the medium of paper or
electronics in a legal format, it is considered more reliable.
7. If the related controls that are imposed by the corporation or the firm are thoroughly
effective, the Audit evidence is the most reliable.
8. If the Audit Evidence is obtained through CPA or the Auditor directly, it will be considered
more reliable when compared to obtaining Audit evidence documents from an indirect
source or through any other inference.
9. Original Audit evidence documents are more reliable than photocopies.

16. Q.3 Explain the steps of an audit process?
There are total 10 steps of the audit process:
1. Notification: Audit process begins with notification. The notification process alerts the
party to be audited of the date and time of the process. The notification also will list the
documents that the order wishes to review in order to understand the organization of
the company.
2. Planning: Planning is the steps the auditor takes, before the audit, to identify key areas
of risk and areas of concern.
3. Opening meeting: Meeting between the auditing staff and senior management of the
auditing target as well as administrative staff. The auditors will describe the process they
will undertake. Management will describe areas of concern to them and the schedule of
the employees that must be consulted.
4. Fieldwork: Fieldwork begins after the results of the meeting are used to adjust the final
audit plans. Employees are notified of the audit, schedules are drawn up regarding the
activities of the audit staff, and an initial investigation begun after learning of business

17. procedures, interviewing key staff, testing current business practices by sampling,
reviewing the law and testing internal rules and practices for reasonableness.
5. Communication: The audit team should consistently be in contact with the corporate
auditor to clarify processes, gain access to documents and clarify procedures.
6. Draft audit: At the completion of the audit, the next step, the draft audit, is prepared.
The draft audit detail what was done and what was found, a distribution list of parties
to receive preliminary results, and a list of concerns.
7. Management response: The draft is given to management to review, edit and suggest
changes, probe areas of concern and correct errors. Upon making final corrections, the
report is given to management for the seventh step, the management response.
Management is requested to answer the report by stating whether they agree with the
problems cited, the plan to correct noted problem and the expected date by which all
issues will have been addressed.
8. Final meeting: The final meeting is designed to close loose ends, discuss the
management response and address the scope of the audit.
9. Report distribution: The ninth step is the report distribution, where the final audit
report is sent to appropriate officials inside and outside the audit area.

18. 10. Feedback: The last step is the audit feedback whereby the audited company
implements the recommended changes and the auditor’s review and test the quality,
adherence and effects of the adopted changes. This continues until all issues are adopted
and the next audit cycle begins.

19. Q.4 Define Nonconformity? Explain with suitable examples.
As the audit proceeds, there might arise some situations where the facts indicate there is a
failure, either partially or wholly, of the quality management system, such a situation is
called “nonconformity”.
What is nonconformity?
• Acondition adverse to Quality
• The non-fulfillment of a requirement
An Industry Example of Non-conformance
In manufacturing, non-conformance can be an unexpected event that happens in the
manufacturing process. It is a deviation from a set standard or requirement.
Non-conformance management solutions allow for the identification and documentation of these quality
events, apply standard risk criteria to classify, route incidents appropriately, then enforce a structured failure
analysis, identifying root causes, isolating and final implementation of a solution.

20. Q.5 Classify Nonconformities and explain with suitable examples
There are three types of non-conformities:
A) Critical Non-conformities:-
A deficiency that has produced, or leads to a significant risk of producing either a product
which is harmful to the human or veterinary patient or a product which could result in a
harmful residue in a food-producing animal. Examples as follows:-
• Training for sterile production personnel did not include critical aspects and techniques
• Quality of water used for production not properly monitored and not according to
procedures
• Product complaints not dealt with appropriately. No corrective nor preventive actions
taken
• No written procedures for treatment and sanitation of water, operation for dry heat
sterilizer, sampling of packaging materials, intermediates, bulk and finished products.
• IPQC tests not carried out consistently.
• Results of IPQC tests used for finished products.
• Calibration of laboratory equipment not done.

21. B) Major Non-conformities
• No records to evaluate the effectiveness of UV treatment to determine quality of water
• No corrective actions taken on reports of internal quality audits.
• No duty lists documented for key personnel.
• Laboratory safety facilities incomplete.
• No procedure for sampling of samples for IPQC.
• Frequency and tests carried out not according to stability guidelines and not
satisfactory.
• No log books for crucial equipment.

22. C) Minor Non-conformities:-
Minor non-conformities seldom occur and detection is not difficult. For example, a missing
signature on a document or unauthorized changes to a document is minor non-
conformities.conformities. Examples are as follows:-
• Lay-out plan for production area not updated.
• Rooms used for several activities labelled differently.
• No status labels for clean machines and equipment.
• Organization chart not updated.
• Documents have many typographical errors, scribbling and incomplete.
• Laboratory personnel lack training.
• No calibration schedule for laboratory equipment.

23. Q.6 Enlist the elements of quality system. Discuss management responsibilities as a
component of quality System
Elements of Quality System are:-
• Management Responsibilities
• Resources
• Manufacturing Operations
• Evaluation Activities
Management Responsibilities

25. Q7. Illustrate the premises and personnel as components of cGMP regulation.

29. Q.8 Illustrate “equipments and raw materials” as a component of cGMP regulation?

31. Q.9 Illustrate the considerations
for packaging and labelling
control as per cGMP regulation.

38. Q.10 Explain the “management responsibilities and resources” as an element of quality
system?

41. Q.11 What is quality system approach? Explain in brief “manufacturing operations” element of
quality system.

45. Q.12 Explain the “evaluation activities” of quality system?

48. Q.13 Discuss the important considerations under “transitioning to quality system approach”.

52. O.14 What is quality risk management? Explain its various components?

55. Q.15 What is CAPA? Explain the functions of quality assurance?

57. Q.16 What is vendor audit? Discuss the important parameters taken into consideration while
auditing vendors for pharmaceuticals.

59. Important parameters taken into consideration while auditing vendors for pharmaceuticals.
A) General Controls.
B) Organisational and management responsibilities.
C) Employee orientation, quality awareness and job training.
D) Plant safety and security
E) Internal quality / GMP audit program.
F) Quality cost program
G) Facility control
1. Facility design and layout
2. Environmental Control programme
3. Facility maintenance and good housekeeping program
4. Outside contractor control programme
H) Outside contractor control program
I) Equipment control
J) Material / component control
K) Operational control
L) Finished product control.

60. Q.17 What is vendor audit? Illustrate the reasons for removal of vendor from the approved
vendor list of a pharmaceutical company. Indicate the importance of vendor audits?
 A vendor audit is performed for a company that aims to attain an objective assessment of its
contractors’ or vendors’ compliance to the terms, conditions and intent of the contracts
and/or agreements between two entities.
 As a part of a vendor audit programme, a facilityand system will be inspected periodically
andsupplier will be qualified accordingly. In case ofdeficiency in supply, a deficiency related
audit maybe conducted for a qualified supplier. This will help toidentify the problem and will
avoid repetition of suchfailure.

62. Q.18 Illustrate the key points in the audit checklist of capsule production area?
 SOP Review.
 Personnel Review
 Facilities review
 Prevention of cross-contaimination review
 Equipment and facility cleaning review
 Working procedures
 In process-control reviews
 Lubricants
 Equipment Qualification
 List of equipments used in capsule section.

64. Q.19 Discuss schematically the workflow in conducting the audit of a packaging area of a
pharmaceutical company?

67. 12 Marks Questions

68. Q.1 Elaborate the Principles of Auditing?

75. Q.2 Describe the methods of gathering audit information.

77. Q.3 (a) What is vendor audit? Enlist the objectives of vendor audit. Discuss the features of bulk
pharmaceutical chemicals vendor audit?
A vendor audit is performed for a company that aims to attain an objective assessment of its
contractors’ or vendors’ compliance to the terms, conditions and intent of the contracts and/or
agreements between two entities.
The goal of any vendor audit is to assess the quality management of the entire organization,
through its procedures and processes.
Quality control is assessed based on the efforts taken by the vendor to ensure their products and
services meet all needs to conduct business and process transactions.

79. b) Describe the process of conducting audit of tablet production department?

85. Q.4 (a) Illustrate the importance of conducting vendor audits. Discuss packaging material
vendor audit. Support your answer with a suitable vendor audit checklist features.

89. Packaging
material
vendor
audit

92. Key points in the audit checklist of capsule production area.