1. finance
2. accounting and auditing

Supplier Compliance Audit Network (SCAN)
Improving Supply Chain Audit Efficiencies through Collaboration
Supplier Compliance Audit Network (SCAN)
Improving Supply Chain Audit Efficiencies through Collaboration
Introduction
Our dependency and utilization of international suppliers and factories is growing. As globalization
increases, so does risk and exposure throughout the supply chain.
In a ‘one-to-one assessment environment’ where a single importer conducts a supplier or factory
assessment, we are putting unnecessary strain on our supply chain partners. One of the most common
complaints by the international supplier base is the repetition of Supply Chain Security audits.
Collectively, we are overburdening the supplier and factory base, and as an importer we can save
precious resources through a shared assessment community approach. Moving to a ‘one-to-many assessment environment’ is the best path forward and the purpose of the SCAN Association.
The Challenge
In today’s marketplace, businesses are expanding their global footprint and sourcing from emerging markets. Today, the best
method for understanding supplier compliance is by conducting an onsite audit to verify that business partners are
implementing supply chain security policies and procedures effectively. With thousands of importers assessing facility
compliance there are challenges that need addressed, such as:
• Supplier Audit Fatigue
• Inconsistent Reporting – no industry accepted standard
• Varying Degrees of Security Compliance Requirements and Corrective Action Plans
• Lack of Collaboration and Sharing of Best Practices
• Company Resources – both the supplier and importer are strained
Most importers have audit programs established, and more often than not, audits are very similar in scope with little variation
in questions and requirements. This high volume of similar audits has become a point of frustration for suppliers and
production facilities and has resulted with additional cost of goods to the importer. SCAN will eliminate audit fatigue and
by utilizing one agreed upon audit that is shared by member companies.
Improving Supply Chain Audit Efficiencies through Collaboration
SCAN Shared Audit Concept
What will the Supplier Compliance Audit Network look like?
▼
SCAN Steering Committee
Standardized Security Audit Approval Committee
3rd Party Audit Selection Committee
Audit Rate Committee
3.
SCAN
Member A
SCAN
Member B
SCAN
Member C
Unique Audit
Report
Unique Audit
Report
Unique Audit
Report
SCAN Audit Repository
▼▼
Audit
Findings
2.
1.
1.
Approved 3rd Party
Audit Company
Approved 3rd Party
Audit Company
Supplier A
Approved 3rd Party
Audit Company
Supplier B
Approved 3rd Party
Audit Company
Supplier X
C
SCAN Member or the Supplier Requests an Audit; SCAN Selects the Audit Company.
2. 3rd Party Audit Company Submits Audit Findings to the SCAN Database.
3. SCAN Members Receive or Have Access to the Audit Results with an option to Receive the Audit Report.
Improving Supply Chain Audit Efficiencies through Collaboration
SCAN Association
SCAN Board and Committees
SCAN Association Fees
The SCAN Board of Directors oversees all aspects of the
association. The Directors are committed SCAN members
and are key representatives from the importer community
with a vested interest in the development and success of the
association. The Board has furthered the association’s
structure by establishing by-laws, an anti-trust statement,
pricing models, audit work flows, and oversees these
committees that focus on strategic objectives:
Supplier or Production Facility Cost
• Audit Criteria & 3rd Party Audit Firm Selection
• Audit Repository Management
• Member Criteria
• Public Relations
The Board and Committee members are elected and voted
into their position by association members. Elections are held
every other year at the annual Fall SCAN Conference. The
current Board and Committee consist of members of these
companies: Walmart Stores, The Home Depot, The Coleman
Company, Husky Injection Moldings, Celgene, and Boeing.
SCAN Benefits
SCAN will benefit corporate members and their business
partners through an audit sharing network.
Supplier and Facility Benefits include:
• Reduced audit fatigue
• Enable a consistent corrective action plan
• Minimize audit costs
The supplier or production facility is responsible for the cost
of the audit. The audit cost is established by SCAN based on
the country where the audited facility is located.
SCAN Member Fees
Fees that are the responsibility of the SCAN member
Fees are based on the Category of the member company:
Membership Categories
Executive Membership
Available to a direct importer who is eligible for global
authorized economic operator programs.
• This is a full voting rights membership
• Access to SCAN security audits that fall within your
supply chain
Associate Membership
Available to transportation and logistics providers, such as a
highway carrier, dray carrier, rail carrier, air carrier, freight
consolidator/de-consolidator, origin manager, warehouse/
distribution center, who are eligible for a global authorized
economic operator program.
• Voting privilege is limited to only matters submitted by the
Board to a vote of the Associate Members.
• Access granted only to business related audits.
• Establish and maintain a uniform audit standard
Affiliate Membership
SCAN Member Benefits include:
Available to service providers who provide supply chain
solutions and services such as a software company, security
devices, seal manufacturer.
• Reduced resources dedicated to an audit program
• Industry accepted security criteria standard
• Confidential method to share audit results
• This is a non-voting rights membership.
• No access to audits.
• Search feature to locate participating facility
• Automated audit repository
• Consistent corrective action plan
• Automated intelligence reporting
Improving Supply Chain Audit Efficiencies through Collaboration
Annual Fees for Membership Categories:
SCAN SCM Premium
Executive Membership Fee: Tier Rate based on
Volume of Audits
$18,000 per year with SCAN membership
• Tier 1 Membership:
Annual volume of more than 3,001 audits: $7,500 USD
• Risk-Based Scoring
• Tier 2 Membership:
Annual volume of between 1,001 to 3,000 audits: $4,000 USD
• Corrective Action Plan Functionality
• Tier 3 Membership:
Annual volume of between 101 to 1,000 audits: $2,500 USD
• Supplier Plotting
• Tier 4 Membership:
Annual volume of between 1 to 100 audits: $1,000 USD
• Quarterly Business Reviews
Associate Member Fee: Flat Rate of $4,000 USD
Affiliate Member Fee: Flat Rate of $7,500 USD
Annual Fees for Repository Access
SCAN offers 3 access options for the shared audit repository.
Each option provides member companies with different levels
of management capabilities, allowing your oganization to
select a package suitable for your budget and audit
management requirements.
• SCAN Audit Report Access
• Executive Dashboard
• Global Risk Maps
• Risk Builder Functionality
• 3 Users Included ($1500 per additional user)
Once new members have been approved, they will be
contacted by a SCAN representative to make their package
selection. More information will be provided once
membership is approved.
SCAN Application Process
Want to become a member of SCAN?
1.
Complete and submit a Membership Agreement and
a Membership Application. Select your company’s
membership category.
2.
The SCAN Board of Directors will review the
membership application. If approved, SCAN will
provide an invoice for dues payment. An application is
generally processed within two weeks of submission.
3.
Make the dues payment by either check or online.
4.
Select a SCAN repository access package
5.
Enjoy the benefits of your new SCAN membership!
SCAN Audit Repository
Access included with SCAN Membership
• Supplier Search Functionality
• View Audit Report
• Order SCAN Audits
• 1 User Included ($250 per additional user)
SCAN SCM Plus
$12,000 per year with SCAN membership
• SCAN Audit Report Access
• Risk-based Scoring
• Corrective Action Plan Functionality
• 2 Users Included with Access ($750 per additional user)
Improving Supply Chain Audit Efficiencies through Collaboration
Email [email protected] or visit
www.scanassociation.com for more information
about the SCAN Association and membership.