07:00
Faizan
When people first think of an audit, they usually think of auditing financial accounts. However, businesses use audits for many different purposes, depending on what strategies and processes they are working on. A tender or tender offer is a potential offer of a contract between a supplier and a business that wants to enter into a purchasing relationship. Organizations considering multiple tenders from suppliers use an audit checklist to carefully evaluate each offer they receive.
Technical Evaluation
The technical evaluation steps are closely related to the cash flows that would result from the acceptance of the tender offer. When auditing the tender, analysts carefully consider the costs of purchasing the supplies, the costs of finding a time schedule that works for the supplier and purchasing organization alike, and any costs related to storage and transportation. Revenues associated with better quality items, discounts or new production creation will also be considered.
Compliance With Terms
Next, most auditors will begin checking if the tender has met all necessary regulations. If a tender was not submitted on time, or if it did not include all necessary information as requested, the auditor may immediately reject it. Tenders usually need to fall within a certain price range and include specific guarantees, as well as meet necessary quality standards for the business.
Risks
Auditors will also gauge the risk of accepting one tender over another. This includes not only the risk of moving ahead with the business project that requires the supplies, but also the risks of using one supplier, possibly with cheaper prices, than a more expensive supplier that may be a more stable business and safer to work with in the long term. Companies try to choose a supplier that will lower risk across the board, but some risk is typically acceptable.
Comparison to Final Price
Supplier tenders often come down to the final price. Auditors in the last stages of an evaluation will check out what the tender offer was and what the final price, after negotiations, turned out to be. This will show how well the supplier responds to negotiations and how accurate both the original tender offer and the organization's price expectations were.
Technical Evaluation
The technical evaluation steps are closely related to the cash flows that would result from the acceptance of the tender offer. When auditing the tender, analysts carefully consider the costs of purchasing the supplies, the costs of finding a time schedule that works for the supplier and purchasing organization alike, and any costs related to storage and transportation. Revenues associated with better quality items, discounts or new production creation will also be considered.
Compliance With Terms
Next, most auditors will begin checking if the tender has met all necessary regulations. If a tender was not submitted on time, or if it did not include all necessary information as requested, the auditor may immediately reject it. Tenders usually need to fall within a certain price range and include specific guarantees, as well as meet necessary quality standards for the business.
Risks
Auditors will also gauge the risk of accepting one tender over another. This includes not only the risk of moving ahead with the business project that requires the supplies, but also the risks of using one supplier, possibly with cheaper prices, than a more expensive supplier that may be a more stable business and safer to work with in the long term. Companies try to choose a supplier that will lower risk across the board, but some risk is typically acceptable.
Comparison to Final Price
Supplier tenders often come down to the final price. Auditors in the last stages of an evaluation will check out what the tender offer was and what the final price, after negotiations, turned out to be. This will show how well the supplier responds to negotiations and how accurate both the original tender offer and the organization's price expectations were.
Posted in: Products & Brands
