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Practice Guide to Auditing Efficiency

Projects and Operations Management


Project management is the discipline of planning, organizing, and controlling resources to achieve specific goals. A project is a temporary endeavour with a defined beginning and end (usually time-constrained, and often constrained by funding or deliverables), undertaken to meet unique goals and objectives.

Operations management is an area of management concerned with overseeing, designing, and controlling the production of outputs and redesigning operations for the production of goods or services. It involves the responsibility of ensuring that operations and business processes are efficient in terms of using as few resources as needed, and effective in terms of meeting customer expectations and regulatory requirements. Operations are repetitive, permanent, or semi-permanent functional activities that produce products or services.

Knowledge of Business Questions

Potential Audit Criteria

  • Does the organization have documented operations management systems and practices that demonstrate due regard for efficiency?
  • Does the organization have documented project management systems and practices that demonstrate due regard for efficiency?
  • How does the organization optimize its available production capacity, facilities, equipment, and personnel to produce the targeted volumes of outputs (goods and services)? For example, are there systems for monitoring the utilization of major resources?
  • How does the organization measure performance and efficiency? What are the key performance indicators and targets related to efficiency? Are targets and standards being met?
  • Does the organization have means of tracking the performance and efficiency of operations where the outputs are difficult to measure? For example, does the organization monitor achievement of milestones and target dates?
  • Has the organization performed an assessment of controls over efficiency? If so, did the assessment include comparisons with other organizations?
  • Due regard to efficiency—The organization’s project and operations management controls, operational systems, and work processes demonstrate due regard to efficiency.
  • Operating systems and procedures—The organization’s service delivery operations are designed and carried out using efficient systems, processes, and procedures.
  • Utilization of production capacity—The organization optimizes the available production capacity, facilities, equipment, and employees to produce targeted volumes of goods and services.