Following is the report of employee

Following is the report of employee training audit
Conditions:
New machine used by company have user manuals, but further intensive on the spot training on the machine’s location is needed to get overall understanding of the manual. However the training delivered in the form of classical classroom training. Confirmation has been made to the Human Resources manager and the information reveals is that there is not enough budget to continue the training to the practical level. The company did not have periodic training plan and the trainings are determined based on line manager request that has to be realized as soon as possible without any training needs analysis. Annual budget for training is about 0,25% from previous year income after tax. Training budget for the year of 2008 is based on 2007 income after tax amounted to 650,75 billion. There is also additional information that the defected product level was decreased from 20% to 18% compared to last year (2% only). Formal training result analysis is also unavailable, so the effectiveness of the training cannot be measured reliably.

Questionnaire spread to employees came back with the following result :
a. 35% of participants indicate that the trainings are suitable for their need to improve their skill.
b. 12,5% of participants indicate that the training method used is in line with the training material.
c. Only 35% of participants indicate that their skill is improved after join the training.
d. 80% of participants indicate that the training duration is too short and there is no enough time for them to understand the training materials.

40% of defects are found in the production process, 35% in the packing stage, and 25% in the storing stage from the total cost of Rp 825,25 million during 2008. Return from customer during 2008 is amounted to 7,5% from total sales of Rp 7,5 trillion.

Criteria:
The purpose of employee training and development must be clearly defined and announced to all line managers. The aims of the training are:
a. Improving employee skill.
b. Decrease product defects at the level of 2,5%.
c. Decrease inefficiency in resources used.
d. Decrease the numbers of incidents during production.

Employee Training and development plan should be prepared periodically along with corporate budget preparation.

Training program is defined based on training needs identification which include :
a. Type of skill needed by employees to maximize their contribution to the company.
b. Periodic assessments should be conducted to identify training needed.
c. Measuring the training to get feedback for improvements.
d. Benchmarking with similar industry that have better training and development program.


Training should be supported with available budget.

Cost of quality report should be documented to get the feedback to improve process and product quality.

Cause:
training delivered in the form of classical classroom training and fail to improve employee skill to operate machine.

The company did not have periodic training plan and the trainings are determined based on line manager request that has to be realized as soon as possible without any training needs analysis.

Effect:
1. Unskillful employees to operate new machines.
2. No documents/records of training result to be accounted for.
3. No Cost of quality report to improve process and product quality
4. Increase in product defects.
5. Production inefficiency in materials.
6. Decrease in main customer order
7. Uneconomical cost of production.


Required:
Explain audit procedures needed to get proper evidence to support the audit findings.
What recommendation might be given by auditor related to the findings (Use your own assumptions if needed.