Manufacturing
Quality Management
Non-Conformance Report Template: Fields, Disposition and Corrective Action
Last updated: October 13, 2026 · Independent guide · We do not sell rankings or coverage.
A non conformance report (NCR) is the record you create when a part, lot or service fails a requirement, and it should carry the problem from discovery to a signed disposition and, where the risk justifies it, a corrective action. A usable NCR identifies exactly what is affected, shows how you contained it, records who decided what to do with the material and why, and links to the root cause work. ISO 9001 clause 8.7 sets the minimum: describe the nonconformity, the actions taken, any concessions, and the authority who decided. The template below covers those four items and adds the fields that small and mid-sized manufacturers usually find they need during audits and customer complaints.
How to use this template
Copy the table into a spreadsheet, a form tool or your ERP’s custom fields, keeping one row per field. Fill sections A to C at the point of detection, section D within the containment window you set (many plants use the same shift), section E at the material review, and sections F to H as the investigation closes. Give every NCR a unique number before anything else, and never reuse or delete a number, even if the report is cancelled.
Non-conformance report template
| Section | Field | What to enter | Completed by |
|---|---|---|---|
| A. Identification | NCR number | Sequential ID, e.g. NCR-2026-0147 | Quality |
| A. Identification | Date and time found | When the defect was detected, not when the form was typed up | Originator |
| A. Identification | Found by / found at | Name, and the stage: receiving, in-process, final inspection, customer, field | Originator |
| A. Identification | Source type | Supplier, internal production, customer return, or service | Originator |
| B. Product | Part number and revision | Item ID and drawing or spec revision in force | Originator |
| B. Product | Lot, batch or serial numbers | Every affected lot or serial; note if the range is still unknown | Originator |
| B. Product | Reference document | PO, work order, sales order or RMA number | Originator |
| B. Product | Quantities | Quantity inspected, quantity nonconforming, quantity suspect | Originator |
| C. Nonconformity | Requirement | The exact spec, tolerance or clause, e.g. “Dwg 4410 rev C, bore 12.00 +0.02/-0.00 mm” | Originator |
| C. Nonconformity | Actual condition | Measured value or observed condition, with gauge ID | Originator |
| C. Nonconformity | Defect code and severity | Code from your list; critical, major or minor | Quality |
| C. Nonconformity | Evidence | Photos, inspection report, customer complaint reference | Originator |
| D. Containment | Immediate action | Tag, segregate, place on hold, stop line, notify customer | Supervisor |
| D. Containment | Hold location and status | MRB cage, bin or ERP inventory status used | Supervisor |
| D. Containment | Suspect stock checked | WIP, finished goods, in transit and at customer, with results | Quality |
| E. Disposition | Decision per quantity | Use-as-is, rework, repair, scrap, return to vendor (RTV), or regrade; split quantities if needed | MRB |
| E. Disposition | Justification | Why the decision is acceptable; engineering analysis for use-as-is or repair | Engineering |
| E. Disposition | Concession / customer approval | Concession or deviation number and who granted it, or “not required” | Quality |
| E. Disposition | Rework instruction and re-inspection | Instruction ID, re-inspection result, inspector | Production / Quality |
| E. Disposition | Cost of nonconformance | Scrap value, rework hours, freight, sorting; RTV credit expected | Finance / Quality |
| F. Cause | Root cause | Cause statement and method used (5 Whys, fishbone); escape point | Assigned owner |
| F. Cause | CAPA required? | Yes with CAPA number, or No with the reason | Quality manager |
| F. Cause | Supplier corrective action | SCAR number and due date, if the source is a supplier | Purchasing / Quality |
| G. Sign-offs | Disposition authority | Name, role and date of each MRB member who approved | MRB |
| G. Sign-offs | Disposition completed | Who verified that scrap, rework or RTV actually happened, and date | Quality |
| H. Closure | Closed by and date | Quality manager signature; days open | Quality manager |
What ISO 9001 clause 8.7 requires
ISO 9001:2015 clause 8.7.1 says outputs that do not conform must be “identified and controlled to prevent their unintended use or delivery,” and that this also applies to problems found after delivery (quoted by Auditor Training Online, May 12, 2023, a training provider). You deal with them by one or more of four routes: correction; segregation, containment, return or suspension of provision; informing the customer; or obtaining authorization for acceptance under concession. When you correct a nonconforming output, you must verify conformity again.
Clause 8.7.2 is the part that drives the NCR form. You must retain documented information that describes the nonconformity, describes the actions taken, describes any concessions obtained, and identifies the authority deciding the action. Sections C, D, E and G of the template map to those four items. Root cause and corrective action sit in a separate clause, 10.2, which requires you to evaluate the need to eliminate the cause, determine whether similar nonconformities exist or could occur, and review the effectiveness of any corrective action (Auditor Training Online, May 19, 2023).
ISO 9001:2026 was published on September 16, 2026, and certification body LRQA reports that 2015 certificates remain valid until September 30, 2029 (LRQA, no date shown). SGS, working from the final draft, expected minimal changes to clause 8 apart from possible terminology and layout updates (SGS, 2026). Check your clause references against the new text when you transition, but the four record items above are unlikely to disappear. If you make medical devices, FDA’s Quality Management System Regulation took effect on February 2, 2026 and incorporates ISO 13485:2016 by reference, so your NCR process must meet that standard instead (FDA, February 2, 2026).
Guidance for each part of the template
A and B: identification and product
Traceability fields do most of the work later. Record the drawing revision because a part can conform to rev B and fail rev C. List every lot or serial in the suspect range, and write “range not yet confirmed” rather than leaving the field blank. Split the quantity into inspected, nonconforming and suspect, so the disposition can account for every unit.
C: describing the nonconformity
Write the requirement and the actual result side by side. “Bore oversize” forces the reviewer to look up the drawing; “Spec 12.00 +0.02/-0.00 mm, measured 12.05 mm on 14 of 50 pieces, CMM-03” does not. Use a controlled defect code list so you can run a Pareto chart later. Free-text defect names cannot be trended.
D: containment
Containment answers one question: where else could this defect be? Check open work orders, finished goods, stock in transit and recent shipments that came from the same lot, machine, operator or supplier. Physically tag the material and change its status in your inventory system at the same time. A red tag alone does not stop a picker who works from the ERP screen.
E: disposition
Disposition is the decision about the material itself. It is separate from fixing the process. The common options are:
- Use-as-is: accept the material without change because engineering judges it fit for use. This is acceptance under concession in ISO 9001 terms, so record who authorized it and, where your contract requires it, the customer’s approval.
- Rework: bring the item back to full conformance with the drawing, then re-inspect it. Clause 8.7.1 requires that re-verification.
- Repair: make the item acceptable for its intended use without meeting every original requirement. Treat it like use-as-is for approvals, because the part still deviates from the drawing.
- Scrap: destroy or mutilate the material so it cannot re-enter stock, and record the inventory adjustment and its value.
- Return to vendor (RTV): ship the material back for credit or replacement with a return authorization, and open a supplier corrective action request if the problem is systemic.
- Regrade: reassign the material to a different product or application where it meets requirements.
Split a lot when different units need different decisions. Scrap and rework both carry cost, and our guide to standard and actual costing in manufacturing ERP explains where those variances land in your books.
F: cause and CAPA link
Not every NCR needs a full corrective action. Clause 10.2 asks you to evaluate the need, so record the decision either way. A sensible rule is to open a CAPA for every critical defect, every customer-reported defect, and any defect code that repeats a set number of times in a rolling period, and to record “No CAPA: isolated, cause known, corrected at source” for the rest. Put the CAPA number on the NCR and the NCR number on the CAPA, so an auditor can follow the trail in both directions.
G and H: sign-offs and closure
Clause 8.7.2 requires you to identify the authority deciding the action. Define in your procedure who may approve each disposition: for example, a quality supervisor for scrap below a dollar limit, and engineering plus quality for use-as-is or repair. Close the NCR only after someone verifies that the disposition was carried out, not when the decision is made. Track days open as a metric.
Common mistakes
- Treating disposition as corrective action. Scrapping the bad lot fixes the material, not the cause. Keep sections E and F separate.
- Vague descriptions. “Parts bad” cannot be investigated or trended. Always state requirement versus actual.
- Use-as-is without authority. An operator or supervisor accepting parts on the floor leaves no record of who decided, which is exactly what clause 8.7.2 asks for.
- Containment limited to the batch in hand. If you do not check shipped stock and WIP, the same defect reaches the customer on the next delivery.
- Physical tag without a system hold. Material on hold must also carry a blocked or quarantine status in inventory.
- No re-inspection after rework. Clause 8.7.1 requires verification after correction.
- NCRs that never close. An NCR with no closure date is an open finding waiting for your next audit.
- Uncosted NCRs. Without a cost field, you cannot show management what poor quality costs or rank which problems to solve first.
When to move from a spreadsheet to software
A spreadsheet or shared form works when you raise a few NCRs a month, one person owns quality, and auditors accept your version control. Move to software when NCRs regularly cross departments, when holds in the spreadsheet do not match holds in inventory, when you cannot produce an NCR-to-CAPA trail quickly during an audit, or when customers ask for defect trends by supplier or part.
You have three broad options. Form and inspection apps are the cheapest step up: SafetyCulture lists Premium at $24 per seat per month billed annually or $29 billed monthly, with a free plan for up to 10 users (SafetyCulture pricing, no date shown, checked October 13, 2026). These capture NCRs well but do not change inventory status in your ERP.
ERP quality modules keep holds and dispositions tied to stock. Microsoft Dynamics 365 Supply Chain Management has nonconformance records typed as customer, service request, vendor, production, co-product production or internal, with an approval status, linked quality orders and a corrections page for follow-up (Microsoft Learn, August 13, 2025). NetSuite’s Quality Management can trigger nonconformance workflows for quarantine, release and vendor returns from failed inspections, though its datasheet does not mention CAPA (NetSuite datasheet, 2024). Our overview of quality management in manufacturing ERP covers how these modules connect to traceability, and our manufacturing software comparison covers the wider ERP choice.
Dedicated QMS products add document control, training records and full CAPA workflows. Isolocity publishes $220 per full user per month billed annually, $39 per production user and free basic users (Isolocity pricing, no date shown, checked October 13, 2026). QT9 QMS does not publish prices and quotes by concurrent user and deployment type (QT9 pricing, no date shown). The trade-off is a second system to integrate with your ERP so that dispositions still update inventory.
How we researched this
We reviewed the pages that rank for NCR templates, including those from Connecteam, SimplerQMS, Scilife and the SafetyCulture template library. All are published by software vendors, and most gate the template or omit disposition options and ISO clause references. We built the fields from the record requirements in ISO 9001:2015 clauses 8.7 and 10.2, checked ISO 9001:2026 and FDA QMSR status, and took software capabilities and prices only from vendor documentation and pricing pages checked on October 13, 2026.
Related guides
- NetSuite Quality Management: Inspections, Specs and NCRs
- Scrap and Yield Tracking: A Process Guide for Plants
- Material Usage Variance: Formula, Causes and ERP Tracking
Frequently asked questions
What is the difference between an NCR and a CAPA?
An NCR records one nonconformity and what you did with the affected material. A CAPA addresses the cause so the problem does not recur, and one CAPA can cover several related NCRs. ISO 9001 handles them in different clauses: 8.7 for the nonconforming output and 10.2 for corrective action.
Does ISO 9001 require a form called a non-conformance report?
No. Clause 8.7.2 requires documented information that describes the nonconformity, the actions taken, any concessions and the deciding authority. Any format that captures those four items meets the requirement, whether it is a paper form, a spreadsheet or a software record.
Who should approve a use-as-is disposition?
Someone with defined authority, usually engineering and quality together, because use-as-is means accepting a part that does not meet its requirement. If your contract or customer requires approval of deviations, obtain it before shipping and record the concession number on the NCR.
What is the difference between rework and repair?
Rework brings the item back into full conformance with its original requirements. Repair makes it acceptable for its intended use while it still deviates from the original requirement, so repair needs the same approval as a concession.
Does every NCR need a root cause analysis?
No. ISO 9001 clause 10.2 requires you to evaluate the need for action to eliminate the cause, not to run a full analysis every time. Record the decision and the reason on each NCR, and set triggers such as severity, customer impact and repeat frequency for opening a CAPA.
How long should an NCR stay open?
ISO 9001 does not set a time limit. Most plants set internal targets for containment and disposition and track days open as a metric, so stale reports surface before an audit does.
Sources
- Auditor Training Online (sells ISO training), ISO 9001 clause 8.7 control of nonconforming outputs, May 12, 2023. auditortrainingonline.com
- Auditor Training Online (sells ISO training), ISO 9001 clause 10.2 nonconformity and corrective action, May 19, 2023. auditortrainingonline.com
- LRQA (certification body), ISO 9001:2026 is live, no date shown, checked October 13, 2026. lrqa.com
- SGS (certification body), ISO 9001:2026 anticipated changes, 2026. sgs.com
- U.S. Food and Drug Administration, Quality Management System Regulation (QMSR), February 2, 2026. fda.gov
- eCFR, 21 CFR Part 820, up to date as of October 8, 2026. ecfr.gov
- Microsoft Learn, Quality management processes in Dynamics 365 Supply Chain Management, August 13, 2025. learn.microsoft.com
- Microsoft Learn, Quality problem types, November 1, 2024. learn.microsoft.com
- Oracle NetSuite, Quality Management datasheet, 2024. netsuite.com
- SafetyCulture, Pricing, no date shown, checked October 13, 2026. safetyculture.com
- Isolocity, Pricing, no date shown, checked October 13, 2026. isolocity.com
- QT9 Software, Pricing, no date shown, checked October 13, 2026. qt9software.com
Sherman Hsieh
Independent analysis of enterprise software — ERP, CRM and more
