RTO Compliance – Preparing for Audit

Undergoing an RTO Audit can be a stressful experience, but it doesn’t have to be if you are well informed and prepared for the audit. The aim of this webinar is to provide you with information that will help you to understand why and how the Training Accreditation Council implements the audit process and what you can do to help make the experience a positive one for your organisation.

This webinar is delivered by TAC Auditors and introduces you to information and resources that you can use to help with audit preparations, to participate in the audit effectively, as well as how to approach your audit results. The webinar does not address compliance with the regulatory standards

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The information provided here is for private study, research, criticism and review purposes only. For more information visit www.tac.wa.gov.au/copyright

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Understanding the Audit Process

TAC is responsible for ensuring RTOs comply with the requirements of the Standards for Registered Training Organisations (RTOs) 2015. TAC’s audit process aims to ensure the compliance of an RTO with the Standards for RTOs and TAC policies.

The sections detailed below provide information to assist RTOs to understand the audit process: 

Further information on the regulatory environment in which audits are conducted is also available:


Category of Audit

Once registered, the audits that could occur during an RTO’s registration include:

  • audits required as a result of changes to the RTO’s scope of registration; and
  • audits commissioned by TAC as part of its ongoing risk management approach; 

The extent to which each RTO is monitored and audited by TAC during its registration period is based on an assessment of risk to the quality of training and assessment outcomes and the national VET sector.  The process for doing this is described in the TAC Risk Framework

There are a number of different types of audit that may be scheduled by TAC, and these fall into two categories: audits resulting from applications and those initiated by TAC. 

Audits Resulting from Applications

When an application is received, the TAC will undertake a desktop review to determine if the application is complete. If the application requirements have been met, TAC will conduct a risk assessment to determine whether an audit is necessary in line with the TAC Risk Framework and Regulatory Strategy 

Based on the outcome of the risk assessment an audit may be required.  

Audits resulting from applications include:

  • Initial registration audits
  • Amendment to scope audits
  • Renewal of registration audits

Audits Initiated by TAC

Audits initiated by TAC are undertaken most commonly to monitor compliance or respond to an identified risk. Should your RTO require an audit you will be notified in writing of the type of audit to be undertaken and the reason for it.

The different categories of TAC initiated audits include:

Monitoring audits

In some instances an RTO will be required to undergo a monitoring audit. Monitoring audits are generally targeted audits endorsed by TAC that focus on specific training products or Standards.  These audits are often initiated to ensure that the actions proposed by an RTO to rectify non-compliances have been deployed, or to address particular training areas or concerns that have been raised by industry.

Complaint audits

TAC only investigates complaints that relate to an RTO’s compliance with the Standards for RTOs.  An audit can be initiated in response to a complaint if an internal review determines that there are grounds for further investigation or that there are potential breaches of the Standards. The RTO will be advised of the complaint and the process for the investigation.

Information about complaint audits is available in the TAC Complaints Policy. 

Strategic Reviews

Strategic Reviews provide an in-depth analysis of systemic issues pertaining to a specific industry area or other systemic VET issues.  The consideration of risk at the local level allows WA to respond to locally or nationally identified quality issues and intervene in a timely manner. 

 Strategic Reviews previously undertaken by TAC include:

Compliance Monitoring Audits 

Compliance Monitoring Audits (CMA) allow for the monitoring of compliance with the Standards for RTOs as a result of non-compliances identified at previous audits or when seeking removal of a suspension.

RTOs will be considered for a CMA if one or more of the following criteria applies:

  1. When an RTO has been found critically non-compliant at audit.
  2. When two consecutive significant or critical non-compliant outcomes have been identified at audit against the same training product/s or industry area within a three-year period.
  3. When the Council has determined that the outcome of an audit indicates that a broader audit sample is required due to the identification of risks that could be detrimental to those undertaking VET with the provider.
  4. On application from an RTO for reassessment of the Council’s decision to suspend a provider’s registration.If the RTO meets the criteria, the matter will be sent to the Council for consideration. All CMAs endorsed by the Council will be charged in line with the CMA fees schedule. 

Further information is available in the  CMA policy.


Audit Method

There are two audit methods: 

  • site audits; and 
  • desk audits

Auditors are required to apply the audit principles, which includes natural justice and procedural fairness in the planning, conduct and reporting of all audits, regardless of the type of audit or audit method applied.

The method of audit is determined in line with TAC’s risk approach.

Site Audit

A site audit is an audit that includes a visit to the RTO or applicant’s physical premises. It allows the Auditor to collect, through interviews and observation, a broad range of evidence to determine the extent to which an RTO or applicant complies with the Standards for RTOs.  In most cases, the process for a site audit can be viewed in the following flowchart:

Desk Audit

A desk audit is an audit that is conducted off site, but may involve email or telephone contact with the RTO or applicant. A desk audit may be used where a physical inspection is not required. In most cases, the process for a desk audit can be viewed in the following flowchart:


The Audit Team

An audit may be conducted by a single Auditor or by an audit team comprised of a lead Auditor, one or more co-Auditors and an observer/s may also attend.  Technical experts may also be called upon by the Auditor when seeking technical advice or expertise in regard to an industry specific requirement outlined in the training product.

Roles and Responsibilities of the Audit Team

The following outlines the roles and responsibilities of the audit team for site audits

Lead Auditor

The role of the lead Auditor is to:

  • confirm the scope of the audit with TAC and brief the audit team; 
  • contact the RTO or applicant and make an appointment for audit; 
  • identify and confirm resources (including audit team members and audit documentation) required to conduct the audit; 
  • review documentation and develop a schedule for the audit in conjunction with the RTO or applicant; 
  • conduct the entry meeting;
  • manage audit team resources by ensuring there is effective communication between the audit team, and  the RTO or applicant’s representative to ensure the audit team have access to relevant materials, sites and personnel; 
  • conduct the exit session with the RTO or applicant and confirm follow-up;
  • provide information to the RTO or applicant about the complaint process and follow-up action required; and
  • prepare the audit report with support from the audit team and submit to TAC.

Co-Auditor

The role of the co-Auditor is to: 

  • participate in the entry and exit meetings; 
  • identify and gather information; 
  • analyse and evaluate information; 
  • report findings; and
  • undertake other duties as requested by the lead auditor.

Observers

Observers are drawn from TAC and occasionally from other sections within the Department of Training and Workforce Development. Further to this, new Auditors undergoing induction or new members of TAC staff may attend audits as observers.

Auditors can also request an observer to accompany them to any audit should they feel the need. 

The role of the observer is to:

  • ensure that the correct audit process is followed;
  • guard against bias, error and omission by providing a third-party view of the site visit;
  • in the event of a formal complaint by the RTO, provide a third party account;
  • provide clarification on site visit issues to the TAC Secretariat where required; and
  • participate in the entry and exit interview with the RTO.

Knowledge and Skills of Auditors

TAC establishes a panel of RTO Auditors through a public tender process. 

Auditors are required to demonstrate they have VET knowledge and skills as well as the necessary knowledge and skills to apply audit principles, procedures and techniques when undertaking TAC audits. Auditors must hold relevant auditor competencies and continuously demonstrate current and relevant vocational competencies in the conduct of audits. 

Members of the TAC audit panel are required to undertake ongoing professional development and attend regular mandatory auditor moderation meetings. 

TAC Auditors and must observe the TAC Code of Practice for RTO Auditors and Accreditation Reviewers.


Consultants at Audits

During an audit, the Auditor is required to assess how the systems the RTO has implemented, or intends to implement, meet the requirements of the Standards. Through this process the Auditor also has the opportunity to assess staff’s understanding of these systems.  Many RTOs or applicants engage consultants to help prepare for a TAC audit. For the Auditor to be confident that an RTO has the capacity to meet the requirements for registration, the interaction at the audit must be between the Auditor and the RTO, not the consultant. 

A consultant may attend an audit to provide support to the RTO. However, unless the consultant has been delegated the authority by the RTO’s Legally Responsible Person and will undertake the role on an ongoing basis for the RTO, the consultant cannot:

  • provide responses to the auditor on behalf of the provider; or 
  • enter into discussions regarding the conduct, progress or findings of the audit.

What to Expect Prior to Audit

The following information is to guide RTOs/applicants in preparing for a site or desk audit.

Helpful Information

Undergoing an audit can be a stressful experience, but it doesn’t have to be if you are well informed and prepared for the audit. TAC offers a number of resources to assist you with preparing for your audit:

Site Audits

No two people, business practices or providers are the same. The Auditor will generally not be familiar with a particular RTO’s operations and is therefore reliant on organisational representatives to provide clear and logical information about how the business operates.

Once it has been determined that an audit is required, there are a number of things that an RTO should consider in preparing for the audit.

  • Be informed – review the intent and requirements of the audit as advised by TAC.
  • Consider evidence requirements – the Auditor’s role is to verify evidence that the provider is achieving quality training and assessment outcomes and is using a continuous improvement approach to ensure the ongoing achievement of these outcomes.
  • Conduct a self-assessment prior to audit. Use an approach that suits your business context however, the Users’ Guide to the Standards for RTOscould be used to inform a self-assessment. You may also choose to use the TAC self-assessment template.  Whatever form the self-assessment takes, at the very least it will be important to determine if and how your business is:
    • achieving compliance with the Standards for RTOs
    • meeting training package requirements
    • delivering training to industry standards
    • meeting the learning needs of clients; and
    • continuously improving outcomes.
  • It is a good idea to provide the Auditor with a snapshot of your business, such as the scope of delivery, number of students, modes of delivery, staffing, facilities, client groups, special features, etc. 
  • Decide which staff members, learners and clients will be best placed to provide supporting evidence, and ensure they will be available.
  • Participation in an audit can be stressful. Work with staff to help them feel more at ease with the audit process and let them know what to expect.
  • It is most likely that the Auditor will track the progress of learners and will identify learners and, where relevant, clients such as employers, to be interviewed to determine the extent to which the provider is achieving its outcomes.
  • Allocate a staff member to be the Auditor’s guide during the visit. The guide supports the process by ensuring staff are available at planned times, assisting with auditor requirements and acting as the liaison between the auditor and the provider’s staff.
  • Allocate a workspace for the Auditor to analyse evidence and conduct interviews.
  • Advise the Auditor of any special access arrangements, such as safety clothing, white card, security or parking arrangements.

Desk Audits

If a desk audit is required, you will receive a notification from TAC. The notification will advise you of the scope and scale of the audit and in some instances allow you an opportunity to submit further evidence directly to the Auditor by a specified date. The Auditor will be advised of the timeframe for the submission of additional evidence.

It is up to you to determine what evidence you will submit to demonstrate compliance with the Standards for RTOs. However, the evidence provided should be clearly referenced/indexed to assist the Auditor to understand which Standards/clauses the evidence submitted is addressing. 

If the evidence is not provided to the Auditor by the nominated date, the Auditor will conduct the audit against the Standards for RTOs, based on the evidence previously submitted with the application.

A guide to evidence that you could provide to the Auditor for an amendment to scope of registration application is available in the Amendment to Registration Application Guide. Please note that the list in the guide is not exhaustive or prescriptive.


TAC Audit Procedures

Allocation of audits to Auditors

TAC will issue category specific audits to Auditors in no particular order of preference, however, issues such as location, availability, scope, skills and experience in the category of service will be factors relevant to audit allocation.

Once the Auditor accepts the audit assignment, TAC will advise the RTO and the Auditor will coordinate the next phase in the audit process.

Scheduling a Site Audit

TAC will authorise the Auditor to contact the RTO to schedule a site audit. 

Site audits are to occur within 10 working days of the Auditor receiving authorisation to contact the provider. Should circumstances prevent a site audit occurring within this timeframe, the Auditor will seek direction from TAC. 

Once an audit is scheduled, it is expected to occur at that time unless there is an emergency.  RTOs must contact the Auditor immediately if an emergency occurs. The Auditor may not be able to accommodate a new audit date and may need to seek further direction from TAC.

Please note that if the audit is cancelled, there is no refund of fees for audits related to an application. 

Auditing at a Private Residence

It is now common practice for businesses, including RTOs, to be based at a home office, especially where ‘site-based’ training programs are being offered. TAC considers these audits may potentially present a higher risk for the personal safety of an Auditor and other members of an audit team. To minimise this risk, an Auditor may be accompanied by an observer from TAC if the audit is to be conducted in a private residence.

Changing Audit Scope once an Audit is Scheduled

Audits are scheduled to assess specific training products or industry areas and once scheduled there is limited opportunity to change the scope of the audit. A change of audit scope is likely to require submission of new or additional evidence, which in turn may involve a change to the time an Auditor has been allocated to the audit, the evidence to be observed or people to be interviewed.  If it becomes necessary to change the scope of an audit, the provider must contact the Auditor and TAC  immediately so that required changes may be discussed.


What to Expect During the Audit

The following is a guide on what to expect at a site audit:

The audit will commence with an entry interview to be conducted by the lead Auditor, who introduces the audit team and outlines the audit process and the anticipated schedule for the audit. At this meeting, you will be able to provide the audit team with a snapshot of your business, such as the scope of delivery, number of students, modes of delivery, staffing, facilities, client groups, special features, etc.

During the audit, the Auditor will ask a series of questions and review evidence relating to your organisation’s outcomes and delivery of nationally recognised training in line with the Standards for RTOs.  More information on the storage of records and keeping records for auditing purposes is available in the Fact Sheet – Records Management.

The audit may also include observation of training delivery and/or assessment and discussions with students, staff and end user clients such as employers. The Auditor may also identify opportunities for improvement.

For an initial registration audit, the Auditor will look for evidence that required systems, processes and training and assessment resources are in place. 

The Auditor will take notes during the audit to assist with the preparation of an audit report. These notes may be in hard copy or electronic format. 

The audit will conclude with an exit interview with relevant staff. At this meeting, the Auditor will provide an overview of the audit findings and allow you the opportunity to ask questions. The Auditor will also explain what happens after the site audit. You may make notes, but you will not be given a written report at the exit meeting. The Auditor will inform the RTO or applicant that the information provided at the exit meeting is a preliminary assessment only, and that the official audit report, provided by TAC , will include more comprehensive information on the audit findings.

On conclusion of the audit, the Auditor will ask you to acknowledge that you have been provided with the following:

  • an overview of the preliminary audit findings;
  • any strengths that may have been identified during the audit;
  • any opportunities for improvement; and
  • TAC’s processes following the site audit. 

You will be asked to acknowledge this by signing the Auditor’s documentation, either electronically or in hard copy.


After the Audit

A number of activities occur after the audit which includes:

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