SAFETY MANAGEMENT MANUAL

12.1 INTERNAL AUDITS

Originator: Approved By:
OSU SHIP OPERATIONS Frederick J. Jones Demian Bailey

12.1.1 General

A documented internal audit program and procedure has been designed, planned,
implemented and managed to ensure the entire organization, including offices and the
vessel covered by the Safety Management System, undergo an internal audit at least once
per calendar year.
The purpose of the internal audit is to ensure that the Safety Management System is
effectively maintained and implemented.

12.1.2 Internal Audit Program

The Designated Person (DP) is responsible for the establishment and maintenance of the
Internal Audit program. The DP him or herself shall not conduct the internal audit. The DP
has established the procedure that defines the establishment and maintenance of the
company Internal Audit Program to verify controls for Ship Operations.

The DP utilizes, at a minimum, the resources of vessel personnel, top management

concerns, known Safety Management System problems, results of previous audits, and the
status and importance of the activities to determine the frequency and degree to which each
area is audited.

Operations that are deemed to have a greater than average impact upon safety or the
environment may be audited more frequently than once each year.
The documented procedure covers:

A. The scheduling of internal audits.

B. The audit criteria, frequency, scope and methods for carrying out each audit.
C. The responsibilities of auditors and auditees, and involved or affected parties.
D. The recording and reporting of audit results.
E. The performance of corrective action.
F. The follow-up activities to verify the actions taken and the reporting of the verification
results.

The management personnel responsible for the area being audited ensure that actions
taken in response to any detected nonconformities are taken without undue delay to
eliminate their causes.

12.1.3 Internal Audit Procedure

A. Audit Scheduling

1. An audit schedule shall be maintained to ensure that an internal audit of each unit
(vessel or office) is conducted at least annually.

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 SAFETY MANAGEMENT MANUAL
12.1 INTERNAL AUDITS
Originator: Approved By:
OSU SHIP OPERATIONS Frederick J. Jones Demian Bailey

2. This schedule shall be developed by the Designated Person (DP), and will
indicate the tentative date of the audit, which unit will be audited, which elements
of the ISM Code will be addressed, and the appointed auditor(s).
3. All auditors shall be independent of the area they are assigned to audit.

B. Audit Preparation
1. Prior to the audit, the auditor(s) shall review the pertinent sections of the Safety
Management Manual, Common Procedures, the Vessel Procedures (if
applicable), and any previous audit reports relevant to this unit.
2. The review shall include any observations made during previous audits, a follow-
up to ascertain if any previous nonconformities are still open, and any areas of
emphasis set forth by the Designated Person.
3. It is recommended that the auditor(s) prepare a list of questions on the
“INTERNAL AUDIT CHECKLIST” (Appendix SMF 12.1.1) or similar document to
use as a guide to ensure coverage of the subjects to be audited. The checklist
should be kept to a minimum length in keeping with the objectives and scope of
the audit. The checklist may be filled in by hand or electronically. These shall
become a part of the audit record for future audit guidance.
4. The DP shall coordinate the schedule for the audit with the assigned auditor(s)
and with the Master. This coordination will ensure that the audit does not conflict
with operational commitments of the unit being audited.
5. Any revisions to the schedule shall be reported to and approved by the
Designated Person.

C. Audit Execution
1. After a brief meeting with the Marine Superintendent or Master, the auditor shall:
a. Conduct an opening meeting to outline the scope and objectives of the audit
as well as the methods to be used for carrying out and reporting the audit.
b. Establish a schedule for a representative to be available in each area to be
audited.
2. The audit shall be conducted with the minimum interruption of business. The
auditor shall take adequate notes so that findings and observations may be
accurately reported. The audit is intended to confirm the implementation of the
Safety Management System and its effectiveness. Nonconformities and
Observations, and the evidence for them, shall be communicated orally to the
auditee as they are established.
3. The auditor(s) must take the time to properly document the findings obtained
during the audit. Notes made in the audit checklists should support any
Observations or Nonconformities determined.
4. The auditor shall record the Observation or Nonconformity in Sections 1 through 3
on the “NONCONFORMITY REPORT - CORRECTIVE ACTION REQUEST

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 SAFETY MANAGEMENT MANUAL
12.1 INTERNAL AUDITS
Originator: Approved By:
OSU SHIP OPERATIONS Frederick J. Jones Demian Bailey

(NCCAR)” (Appendix). This form is designed to assist the internal auditor while
conducting the audit.
5. At the closing meeting, the auditor shall present all Nonconformities and
Observations to the Marine Superintendent or Master as applicable, who shall
then sign a printout of each Nonconformity or Observation on the NCCAR. This
signature is acknowledgment that the Nonconformity or Observation has been
identified by the auditor and is not an admission of wrongdoing.

D. Audit Report
1. To assist in the preparation of the audit report, the auditor may write a brief
summary report on “INTERNAL AUDIT REPORT” form (Appendix SMF 12.1.3).
2. The audit report shall include:
a. The list of Nonconformities by number with a brief summary.
b. All Observations noted by the auditor
i. All Nonconformities and Observations shall specifically refer to the
appropriate section of the ISM Code and/or SMM.
ii. All Nonconformities and Observations shall be numbered using the following
system:
NC# - ISM Section – NC Letter
01-12.2 - A
02 - 7.0 - A Examples
02 - 7.0 - B
3. The completed audit checklist and Nonconformity reports shall become the
supporting documentation for the Audit Report. It is considered an important tool
in the formulation of the next audit.
4. The Audit Report and supporting documents shall be filed in the Safety
Management System files maintained in the Ship Operations Office.

E. Follow-Up Action
1. All Nonconformities documented as a result of an Internal Audit shall be subject to
tracking and follow-up activities in accordance with SMM 9.1

12.1.4 Records

The audit checklists and audit reports are considered Safety Management System records
and shall be retained and readily available for future audits.

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