Vendor audit is a form of internal audit that involves examining the performance of your business’ service providers. The primary purpose is to assess vendors for their compliance in regards to quality, effectiveness, and compliance with your company policies.
A vendor audit is an essential task to identify, monitor, evaluate and report the risks associated with your vendors. The vendor audit process is an audit process that identifies and quantifies the risks of outsourcing and insourcing your business. It is important that this process is conducted on a regular basis to ensure continued compliance with business law and regulations, as well as with your internal policies.