Audit Preparation & Response

Module 1: Understanding DCC Inspections

Learn about the types of inspections the Division of Cannabis Control conducts and what inspectors are looking for.

Types of Inspections

🔔 Scheduled Inspections

Annual compliance audits
License renewal inspections
Pre-operational inspections
Follow-up inspections

⚡ Unannounced Inspections

Spot checks
Complaint-based investigations
Random compliance checks
Product recall verifications

⚠️ Critical Point

The DCC has full authority to conduct inspections WITH or WITHOUT notice. Your facility must be audit-ready at all times during operating hours.

Key Inspection Areas

Product Compliance
- Proper labeling and packaging
- Current Certificates of Analysis (COAs)
- Product storage conditions
- Expiration date tracking
Track and Trace
- METRC tag compliance
- Inventory accuracy
- Transaction records
- Waste disposal documentation
Security & Surveillance
- Camera functionality (all angles)
- 45-day recording retention
- Restricted access controls
- Alarm system testing
Personnel & Training
- Current employee licenses
- Training documentation
- Background check records
- Age verification procedures

Inspector Authority

DCC inspectors have the authority to:

Enter any licensed premises during business hours
Review all records and documentation
Take product samples for testing
Interview employees
Review security footage
Photograph violations
Issue immediate corrective actions

💡 Compliance Tip

Designate a specific employee as the primary inspector liaison. This person should be trained on inspection protocols and know where all required documentation is stored.

Module 2: Pre-Audit Preparation

Develop a comprehensive preparation strategy to ensure your facility is always inspection-ready.

Essential Documentation Checklist

License & Permits

Current DCC license (posted visibly)
Local business permits
Fire department approvals
Zoning compliance letters

Employee Records

Current employee roster
Individual employee licenses
Training certifications
Background check documentation

Operational Documents

Standard Operating Procedures (SOPs)
Security plans and diagrams
Waste disposal logs
Inventory audit reports
Lab testing results (COAs)

Physical Facility Preparation

Security Systems

Test all cameras weekly - verify 30fps and clear images
Confirm 45-day recording retention
Check alarm system functionality
Verify restricted access controls work properly
Ensure panic buttons are operational

Product Storage

All products properly labeled with METRC tags
Storage areas clean and organized
Temperature/humidity logs current
Expired products segregated and documented
Limited access areas properly secured

Staff Preparation

Monthly Training Topics:

Inspection Protocols - How to interact with inspectors
Documentation Location - Where records are stored
Compliance Updates - Recent regulatory changes
Common Violations - How to avoid them
Emergency Procedures - Failed inspection response

✅ Best Practice: Mock Inspections

Conduct monthly mock inspections using DCC's inspection checklist. Rotate who conducts the mock inspection to get fresh perspectives on potential issues.

Digital Preparation

METRC Accuracy: Ensure all inventory matches physical count
Record Organization: Create digital folders mirroring inspection categories
Backup Systems: Maintain current backups of all digital records
Quick Access: Bookmark frequently needed reports in METRC

⚠️ 24-Hour Rule

Any security system failure must be repaired within 24 hours. Have pre-approved vendors on standby and document all repair efforts thoroughly.

Module 3: During the Inspection

Learn the proper protocols for managing an active inspection and interacting with DCC inspectors.

Initial Inspector Arrival

1. Verify Credentials

Request inspector ID and verify with DCC if needed

2. Notify Management

Alert designated compliance officer immediately

3. Provide Workspace

Offer clean, quiet area for document review

4. Begin Documentation

Start internal log of inspection activities

Staff Conduct Guidelines

✅ DO

Be professional and courteous
Answer questions honestly and directly
Provide requested documents promptly
Take notes of inspector questions
Ask for clarification if needed
Escort inspector at all times

❌ DON'T

Argue or become defensive
Volunteer unnecessary information
Make excuses for violations
Leave inspector unattended
Attempt to hide issues
Offer gifts or favors

Common Inspector Requests

Request Type	Typical Documents Needed	Response Time
Inventory Verification	METRC reports, physical count sheets	Immediate
Security Review	Camera logs, alarm test records	5-10 minutes
Employee Compliance	License list, training records	Immediate
Product Testing	COAs, lab results, batch records	10-15 minutes
Waste Disposal	Disposal logs, manifests, video	15-20 minutes

Managing Violations

If the inspector identifies a violation:

Stay Calm: Accept the finding professionally
Take Notes: Document exactly what the violation is
Ask Questions: Understand correction requirements
Request Timeframe: Get clear deadlines for corrections
Document Everything: Take photos if permitted

💡 Pro Tip

Create an "Inspection Kit" with copies of frequently requested documents, a clipboard, pens, and a camera. This allows you to quickly respond to inspector requests without scrambling.

Closing the Inspection

Request a closing conference with the inspector
Review all findings and violations
Clarify any corrective action requirements
Get inspector's contact information
Ask about follow-up procedures
Request copy of inspection report timeline

Module 4: Common Violations & How to Avoid Them

Review the most frequently cited violations in Ohio cannabis facilities and learn prevention strategies.

Top 10 Most Common Violations

1. Inventory Discrepancies

Issue: Physical inventory doesn't match METRC records

Prevention: Daily inventory counts, weekly full audits, immediate METRC updates

2. Camera System Failures

Issue: Cameras down beyond 24-hour repair window

Prevention: Daily camera checks, backup equipment, 24/7 repair vendor

3. Improper Product Labeling

Issue: Missing required warnings or information

Prevention: Label approval checklist, quality control checks

4. Expired Employee Licenses

Issue: Staff working with lapsed credentials

Prevention: License tracking calendar, 90-day renewal reminders

5. Inadequate Record Retention

Issue: Missing required 3-year documentation

Prevention: Digital archive system, retention schedule

Violation Severity Levels

Minor Violations

Incomplete training records
Minor labeling errors
Messy storage areas

Typical Response: Warning letter, 30-day correction

Major Violations

Inventory discrepancies >5%
Security system failures
Improper waste disposal

Typical Response: Fine, immediate correction required

Critical Violations

Diversion of product
Sales to minors
Falsified records

Typical Response: License suspension/revocation

Prevention Strategies by Category

📊 Inventory Management

Implement cycle counting procedures
Use barcode scanners for accuracy
Reconcile METRC daily before close
Document all adjustments with photos
Segregate quarantine products clearly

🎥 Security Compliance

Create camera check schedule (AM/PM)
Maintain spare cameras on-site
Test recording retrieval weekly
Document all maintenance/repairs
Verify 45-day retention monthly

📋 Documentation

Use standardized forms for all processes
Implement document control numbering
Create retention schedule matrix
Scan paper documents weekly
Backup digital files daily

⚠️ Red Flag Behaviors

Inspectors are trained to identify these problematic behaviors:

Employees seeming coached or scripted
Reluctance to provide requested documents
Areas that appear hastily cleaned or reorganized
Conflicting information from different staff members
Evidence of recent major system changes

Module 5: Post-Audit Response & Corrective Action

Master the critical steps for responding to inspection findings and implementing lasting corrective actions.

Immediate Post-Inspection Actions

Within 24 Hours

Debrief with all staff present during inspection
Document all violations and observations
Begin correcting any immediate violations
Notify ownership/senior management

Within 48 Hours

Create corrective action plan
Assign responsible parties for each violation
Set internal deadlines (before DCC deadlines)
Order any needed supplies/services

Within 72 Hours

Submit initial response to DCC if required
Schedule staff training on violations
Begin implementing systemic changes
Document all corrective actions taken

Corrective Action Plan Template

Essential Components:

Violation Description - Exact wording from inspector
Root Cause Analysis - Why the violation occurred
Immediate Actions - Steps taken to fix the issue
Long-term Solutions - Preventing recurrence
Responsible Party - Who will ensure completion
Completion Date - When it will be done
Verification Method - How you'll prove compliance

Communicating with DCC

Written Responses Should:

Be submitted on company letterhead
Reference specific inspection date and report number
Address each violation separately
Include supporting documentation
Maintain professional, factual tone
Avoid excuses or blame

Example Response Structure:

"Regarding Violation #1 (Inventory Discrepancy):

We have identified the root cause as inadequate training on METRC adjustments. We have:

1. Corrected the inventory count in METRC (completed 1/15/25)

2. Retrained all staff on proper procedures (completed 1/16/25)

3. Implemented daily inventory audits (ongoing)

Supporting documentation attached."

Follow-Up Best Practices

Internal Audits: Conduct weekly checks on corrected items
Staff Accountability: Include compliance in performance reviews
Documentation: Maintain file of all corrections made
Communication: Update staff on inspection outcomes
Prevention: Revise SOPs to prevent recurrence

🎯 Success Metrics

Track these KPIs to measure inspection readiness improvement:

Number of violations per inspection (trending down)
Severity of violations (moving from major to minor)
Time to correct violations (getting faster)
Repeat violations (should be zero)
Mock inspection scores (trending up)

Module 6: Building a Comprehensive Audit Program

Create a proactive audit program that ensures ongoing compliance and continuous improvement.

Components of an Effective Audit Program

1. Self-Audit Schedule

Daily: Security checks, inventory counts
Weekly: Full facility walkthrough
Monthly: Comprehensive mock inspection
Quarterly: Third-party audit

2. Audit Tools

DCC inspection checklists
Custom facility checklists
Photo documentation apps
Compliance tracking software

3. Team Structure

Compliance Officer (lead)
Department representatives
Rotating audit team members
External consultant (quarterly)

Monthly Mock Inspection Protocol

Week	Focus Area	Auditor	Duration
Week 1	Inventory & METRC	Inventory Manager	2-3 hours
Week 2	Security & Surveillance	Security Lead	2 hours
Week 3	Product & Labeling	Quality Control	3 hours
Week 4	Full Facility Audit	Compliance Officer	4-5 hours

Creating a Culture of Compliance

Leadership Actions:

Make compliance a stated company value
Allocate adequate resources for compliance
Recognize employees for compliance excellence
Address violations as learning opportunities
Lead by example in following procedures

Employee Engagement:

Include compliance in onboarding
Create compliance suggestion box
Reward violation prevention
Share inspection results transparently
Celebrate compliance victories

Technology & Tools

Continuous Improvement Process

1. Measure

Track compliance metrics and audit scores

2. Analyze

Identify patterns and root causes

3. Improve

Implement targeted solutions

4. Control

Monitor and maintain improvements

🎓 Key Takeaways

A successful audit program is proactive, not reactive. By implementing regular self-audits, maintaining a culture of compliance, and continuously improving your processes, you'll be ready for any DCC inspection. Remember: the goal isn't just to pass inspections—it's to operate a compliant, professional cannabis business that serves Ohio patients and consumers safely and effectively.