Tag Archives: aviation audit

Good Cop, Bad Cop: Consulting or Auditing?

I pop into a popular industry forum from time to time to see what’s on people’s minds and recently saw a pretty typical post in which someone was asking for recommendations for an auditor. The gentleman got several responses but some cautioned about auditors who cross into consulting while conducting an audit. Another poster jumped in with a comment about how unethical it is to consult while auditing. That’s true. Just like you shouldn’t provide instruction while conducting a checkride, you shouldn’t consult while auditing. It’s basically cheating. Either the operator is prepared and meets the audit standard when the auditor arrives or they don’t, right? Further, one fundamental of auditing is that an auditor shouldn’t evaluate their own work. If the auditor gives the operator “the answer”, that’s exactly what happens.

It’s so easy on paper isn’t it? Audit – don’t consult. In reality, it’s a difficult line to walk. I don’t love auditing because I truly enjoy helping people and when I’m auditing I feel like the “bad cop”. Obviously an audit can be conducted in a respectful, friendly manner. There’s no need to be rude or unkind. But it can be hard to tell an operator – especially a company with friendly staff who are eager to do well – that their hard work isn’t quite enough to meet the standard. And they often ask, “What do you recommend?” As an auditor I really can’t answer that except to suggest they re-read the audit standard and any applicable guidance or other references. I can’t “fix it” for them.

The other point noted in the forum was the practice of jacking up a bill by consulting during an audit. That’s a very unethical practice. An audit is a fixed service – typically preparation time, on-site time, report drafting time – and those should all be included in a fixed fee. The time needed to audit an organization can vary based on the size and complexity of the operation but an auditor should obtain those details before they present a proposal. An experienced auditor will have an idea of how long a particular audit will take and should be able to identify a fixed, fair fee. Any auditor that adds on to the bill because they provided additional services during the audit is doing the operator a real disservice.

What if an operator really likes the auditor’s perspective, personality, and skill set and would like the auditor to help with improvements? Certainly some of my clients are former “auditees” of mine, but there’s a professional way to approach this. I thank the operator for their interest but tell them we need to finish the audit process before we discuss additional work. If they need help closing their audit findings, I refer them to a trusted colleague. I stay out of the process until the operator is able to present acceptable corrective actions (or otherwise finish the audit in accordance with the particular audit standard) and I am able to write the report and recommend the operator for the audit registration. Only after the audit process is completely finished am I willing to discuss an opportunity to help the operator on additional projects.

I try to keep the line very clear between auditing and consulting for a number of reasons. Aside from the fact most audit standards (and the very intent of auditing) prohibit consulting while auditing, I despise when unscrupulous consultants create their own work by bringing up issues that aren’t really there. “Your manual isn’t worded exactly as I would word it, but if you hire me, I can fix it.” What is that about? As an auditor, I don’t care if you exercise operational control through iPhone apps and fancy software systems with giant NASA Houston-type screens or with smoke signals so long as your operational control system complies with requirements and is effective.

So here are a few tips from an auditor/consultant to help avoid a good cop, bad cop conflict.

1. Don’t accept a proposal for an audit that includes a variable fee for services outside of the audit itself. Fixed rate + travel expenses = fair proposal. Maybe there’s a situation where a variable rate is appropriate for an audit but seriously – I can’t think of one.

2. It’s cool if you like your auditor and want their expertise after the audit process is done. Save that little nugget until after the audit is completely finished – report accepted by all necessary parties, certification or registration completed, whatever the “finish line” is for the particular audit standard. Then call the auditor and say, “Hey – I like how you think. Would you be interested in helping us with X?” That way no one can question that the outcome of the audit was dependent upon hiring the auditor later as a consultant.

3. Be careful about the types of questions you ask your auditor. Asking “How do you interpret that standard and what guidance materials are available to support your interpretation?” might give you some insight as to what the auditor is looking for if you aren’t sure how to address a finding. It might also reveal the auditor has gone off on their own tangent and isn’t sticking to the audit standard and that’s another issue altogether. But don’t ask, “How would you fix that?” Then your auditor feels like a jerk because they can’t “help.”

How do you ensure a happy audit for your organization?

Click here to read more on how to have a happy audit.

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Smart Supplemental Lift

Every Part 135 operator is a charter broker at some point. A crewmember gets sick, an airplane breaks, or demand simply exceeds your fleet capabilities and you’re out looking for another charter operator to pick up a flight for you. How do you choose your supplemental lift providers? Do you have a vetting process in place or will any operator with a 135 certificate on the wall do in a pinch? Developing and consistently using a documented vetting process can help limit your liability when sending a customer to another air carrier.

To develop an evaluation process, start with the simplest aspects of Part 135 operations.

Is the air carrier legal? That is, do they have a valid Part 135 certificate to conduct the specific type of operation? Many charter operators stop there. Obviously the FAA wouldn’t certificate a company that isn’t really competent to run a Part 135 operation. Right? Well… I’ll let you ponder that one. But just remember – a Part 135 certificate is merely a passing grade. It’s a pretty low bar compared to where the industry really is in terms of safety, security, and efficiency. Do you want your customers flying with the operator who only got a “D” in Part 135 operations? A “D” is a passing grade and personally I don’t want the “D” pilot, the “D” charter operator, or the “D” brain surgeon. Achieving a passing grade really isn’t saying much.

Most operators go beyond the Part 135 certificate and require proof of certain insurance limits. While it’s certainly prudent to verify insurance coverage, that’s like putting on your seatbelt after the car has struck a tree. It’s far better to exercise due diligence and mitigate risk prior to starting the car.

Some charter operators very proudly only use companies with an ARG/US or Wyvern rating or a successful IS-BAO or Air Charter Safety Foundation registration. These ratings and registrations only have value if you know what they mean. What does it take for an operator to earn a particular rating? Is there an on-site safety and operations audit or does the operator just submit data about their fleet and pilots? If an audit is required, what standards must the operator meet in order to be registered? Do findings or concerns have to be addressed before being registered or rated?  All “XYZ Rated!” logos are not equal. I’m not saying one audit or rating is superior to another. They all have some value in our industry. The individual rating or registration’s value depends on your needs and your expectations for your customers but if you don’t know what’s behind the rating, it’s meaningless.

Even an operator’s audit status shouldn’t be a single decision point for choosing supplemental lift. Audits are basically the gym membership of aviation. There are people who buy a gym membership and go work out regularly. Others get the membership and kick themselves every time the monthly fee shows up on their credit card statement because they don’t even remember how to get to the gym. And still other people are very fit and healthy but choose not to have a gym membership.  The operators who work out at the gym regularly not only put themselves out to be evaluated by third party auditors but also strive to keep the audit standards and intent alive and well in between audits. Those who buy memberships and never go back are the operators who pretty up their manuals and bring in donuts for a two or three day audit but if you go back next week, no one knows where the new manuals ended up and the donuts are moldy. (That is purely for illustration purposes, of course. I know no charter operator would do such a thing…) And there are certainly operators who choose not to have a third party evaluation but are still safe, conscientious operators.

This post isn’t intended to tell you how to evaluate charter operators used for supplemental lift. The intent is to get all of us thinking about how and why we choose companies to work with. I get a little knot in my stomach every time an operator says they use any XYZ-rated operator for supplemental lift with no further evaluation beyond verification of the pretty logo. Aside from the personal guilt most of us would feel if we sent a customer to another operator and that flight was involved in an accident, you can limit your legal liability by exercising due diligence prior to choosing supplemental lift providers. You owe it to your employees to protect the company from unnecessary legal risk. You owe it to your customers to put them with carefully chosen air carriers.

I encourage you to develop a detailed, documented process for evaluating your supplemental lift providers and use it for each and every trip you have to send to another air carrier. If you already have a process, give it a good hard look. Is it still valuable? Is it enough? Once you have a reasonable process in place, use it consistently and conscientiously. Be smart about supplemental lift.

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How to Have a Happy Audit

Over the past several weeks, I’ve presented several concerns frequently uncovered during third party audits of Part 135 operators, including ineffective internal evaluation programs; flight and duty issues for flight managers; errors in pilot training records; questionable use of “safety pilots”; and more. Here are some other tips for ensuring a happy audit:

1. Know Your Objective

What do you want to get out of this audit? If we’re all honest with each other, we know different audits have different meanings within your company. Is this a marketing move so you have a logo on your website? Does a particular client require the audit? Are you looking for an critical review of your safety program or operations? Do you want to improve operational processes?

None of these objectives are necessarily “wrong” or “bad”, although I don’t recommend telling the auditor you need a logo on your website so make it snappy. Most auditors will figure out your objective on the first day anyway. (True story: I once had four people ask me on the first day of an audit if we could finish the audit a day early. The main contact on that audit darkened the door of the conference room every afternoon promptly at 4:58, asking if the maintenance auditor and I were finished for the day. The operator’s staff wanted to leave at 5 whether we were finished for the day or not.) Your objective shouldn’t change the quality or content of your audit but it should help you gauge the resources you want to put towards the audit and any subsequent findings.

2. Be Prepared

You get the best quality audit if you are prepared. Complete the pre-audit checklist if the audit standard organization provides one. If a pre-audit checklist isn’t provided, complete the actual audit checklist to see where you stand. Close any gaps you identify before the auditor arrives. Send the auditors the checklist and relevant manuals at least a couple of weeks in advance, if it’s part of the standard protocol for this type of audit. It’s important for them to be prepared for the audit too.

Double check the revision status of your documents. Make sure you send the auditors current versions of documents. I’ve arrived to an audit before with an electronic rev 8 of the SMS and been given a hard copy rev 8 of the SMS. The documents didn’t match, even though they were both rev 8. Double check your revision numbers to make sure everyone is on the same page – literally.

3. Be Available

Be sure appropriate individuals (the Accountable Executive, Director of Operations, Director of Maintenance, Chief Pilot, and director of safety if you have one) are scheduled to be in the office for at least part of the audit. This is not a good time for the Accountable Executive to go on vacation or the DO to go to school for a week. If any critical personnel have scheduling conflicts, tell the auditors and determine an interview schedule. I know you fly airplanes for a living – not complete audits for a living – though it might seem that way sometimes – so I understand if the chief pilot or DO has to go fly. I can’t give you a complete audit if those individuals are unavailable for the entire period though. Make sure you are accessible to auditors for at least part of the audit.

This sounds obvious but provide appropriate resources for the auditors. Twice now I have conducted audits in lobbies. That is a really uncomfortable situation for both the auditors and the operator. To conduct a good systems audit, the mx and ops auditor have to be able to communicate and sometimes we’ll say things you don’t want your customers or even staff to hear. You might not even be doing anything wrong – we might just be sorting things out between the auditors – but it can be awkward.

4. Responding to Findings

Each audit standard has different requirements for timelines and expectations for corrective actions, so I won’t go into this in detail. Ask your auditor if the expectations are unclear. Be sure to keep track of the time remaining to submit corrective action plans or completed actions. Many audit standards require a process or procedure to meet a particular standard, not just a policy statement. Make sure the staff closing the audit findings know how to write a process or procedure and don’t just submit a policy statement and hope the auditor will accept it.

5. Solving Conflicts

We’re all human. Sometimes you and your auditor will disagree. This happens on maybe 1 out of 10 audits I conduct. In most cases, the operator and I reach a common understanding and the issue is resolved. In one case, I had to bring in the audit standard organization to mediate the issue. Remember the auditor is obligated to the audit standard organization – be it IBAC, ACSF, whoever – to uphold their standard. You might not like a particular requirement and that’s okay. You don’t have to like it. But if you want to play in their sandbox, you have to play by their rules.

Let’s say a standard is impossible for your particular operation to comply with, it is totally inconsistent with your operations model, or you just don’t like it. Keep in mind all of these standards exist because someone lobbied for the item to be included. If you disagree with a standard, I recommend one of the following actions: lobby the audit standard organization for an exemption; lobby the audit standard organization to change the standard itself (this is often a long process as most of the customer advisory boards or review boards only meet once a year); or convince the auditor you do something else that meets or exceeds the INTENT of the standard.

Final Thoughts

Keep an open mind. Sure some auditors like to hangar fly and drink coffee but many of them have good experience and insight and just want to help operators be safer and more efficient. Most of us would rather be there advising you than playing auditor cop but we do have a responsibility to uphold the audit standard and most audit standard organizations have strict rules against consulting while on the audit.

Know a good audit when you see. Did you have no findings? Not a one? Don’t go celebrate. You just wasted your time and money. Okay, if you’re a 135 operator and this is your 3rd round at IS-BAO or whichever audit, maybe you don’t have any actual findings. But different auditors should have different perspectives and might see something another auditor didn’t. If you don’t have any actual findings, were you at least provided with some suggestions for improvement?

Know the difference between a required standard and an auditor’s opinion. Sometimes I’ll offer a suggestion aside from the actual audit. You’re not required to do anything with that. I just saw something that might help you be safer or more efficient. You can take it or leave it. But if an auditor writes up a finding that you feel is not substantiated by the standard itself, question the auditor. If that doesn’t work, go to the audit standard organization. The auditor is there to verify compliance with the standard, not enforce their own opinion.

And finally, don’t assume because you just passed an FAA inspection that you will sail through an audit.  First, back to the “we’re all human” idea. Your inspectors might have missed something. On the other hand, your inspector might be allowing activity that isn’t really permitted. And guess who gets to pay if another inspector decides you aren’t in compliance? You do. Also, most third party audit standards are meant to enforce best practices, not just regulatory compliance.

Contact me at Lindsey@mcfarrenaviation.com or by phone at 703-445-2450 if you need assistance preparing for your next audit or closing audit findings!

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