What is a non-conformance report (NCR)?
A non-conformance report (NCR) is the formal record raised when a product, material, service or process fails to meet a specified requirement. It states what the requirement was, what was actually found, how the affected item is controlled, and what will be done with it.
NCR stands for non-conformance report (also written non-conformity report, or NCN/CAR in some systems). It is the controlled evidence that a departure from specification was detected, contained, dispositioned and closed — not a blame document.
ISO 9001:2015 clause 8.7 requires nonconforming outputs to be identified and controlled, and requires you to retain documented information on the nonconformity, the action taken, any concession obtained, and who authorised the decision. The NCR is that documented information.
- 01An NCR records a single, evidenced departure from a stated requirement — not an opinion or an observation.
- 02Every NCR needs a disposition: rework, repair, use-as-is/concession, regrade, or reject/scrap.
- 03Only the design authority or customer can approve use-as-is or repair against a design requirement.
- 04The NCR closes the item; a CAPA closes the cause. Repeat NCRs of the same type should trigger one.
What an NCR is — and what it is not
A non-conformance report is raised the moment inspection, test, audit or surveillance finds that something does not meet a requirement stated in a drawing, specification, code, procedure, purchase order or the quality management system itself. It identifies the nonconforming item, quarantines or tags it, records the objective evidence, and drives a decision about what happens to that item.
The word "requirement" is doing the work in that sentence. If you cannot cite the clause, dimension, tolerance or acceptance criterion that was breached, you do not have a non-conformance — you have an observation or an opportunity for improvement, and it belongs somewhere else in the system.
NCR
A specified requirement was not met, with objective evidence. The item is controlled and dispositioned.
Observation
A weakness or risk with no breach of a requirement yet. Tracked, but no disposition needed.
Opportunity for improvement
Conformant work that could be done better. No control action, no disposition.
What a non-conformance report contains
Templates vary, but an NCR an auditor will accept carries the same fields.
| Field | Why it exists | Weak vs strong entry |
|---|---|---|
| NCR number and date | Unique traceability into the register and into any linked CAPA. | Sequential per project or per site, never reused. |
| Item identification | Ties the record to physical scope: part, heat, spool, batch, lot, serial, PO line. | Weak: "pipe spools". Strong: "Spools SP-1012 to SP-1020, PO 4501, heat 5528B". |
| Requirement breached | Establishes that a non-conformance exists at all. | Weak: "coating not good". Strong: "Spec JAS-CT-04 §5.2 — DFT min 250 µm". |
| Objective evidence | Makes the finding defensible without re-inspection. | Measured values, instrument ID, photographs, test report reference, inspector name. |
| Extent and containment | Answers "what else could be affected?" before the argument starts. | Quantity affected, quarantine location, hold tags applied, shipped stock checked. |
| Proposed disposition | The supplier's or contractor's recommendation for the item. | One of the five options below, with justification. |
| Disposition approval | ISO 9001 §8.7.2 requires the authority who accepted the decision to be recorded. | Named approver plus, for use-as-is or repair, design authority or client sign-off. |
| Verification and closure | Proves the disposition was actually carried out and re-inspected. | Re-test record, re-inspection date, closing signature. |
Use our NCR form as your starting point
A free non-conformance report template with all eight blocks already laid out — identification, requirement, evidence, containment, disposition, verification, CAPA link and close-out. Excel and print-ready PDF.
The NCR lifecycle, stage by stage
From detection to closure, a controlled non-conformance passes through seven stages.
- Step 01Sources: ITP hold/witness points, receiving inspection, NDT, audits, customer complaints
Detect and identify
An inspector, auditor, operator or test finds a departure from a requirement. The nonconforming item is marked, tagged or segregated immediately so it cannot move forward by default.
- Step 02Same day as detection — memories and evidence degrade fast
Raise the NCR
Record the item, the requirement, the evidence and the quantity affected. Write the finding so a reader who was not present can understand exactly what was measured and against what.
- Step 03Ask: what else was made the same way?
Contain and assess extent
Quarantine the batch, check work in progress, and trace back to previously released or shipped material produced under the same conditions. Extent is where most NCRs are under-worked.
- Step 04Proposal only — not a decision
Review and propose disposition
The supplier, contractor or production team proposes what should happen to the item, with technical justification and any supporting calculation or fitness-for-service assessment.
- Step 05ISO 9001 §8.7.2 — record who authorised it
Approve the disposition
The authorised party accepts, modifies or rejects the proposal. Use-as-is and repair against a design requirement need design authority and usually client approval as a concession.
- Step 06No verification, no closure
Execute and re-verify
Carry out the rework, repair or regrade, then re-inspect or re-test against the original acceptance criteria. Reworked items are inspected as new items, not waved through.
- Step 07Trend the register monthly by type, supplier and cause
Close and escalate the cause
Close the NCR with evidence attached, then decide whether the cause needs a CAPA. A single isolated event may not; a recurring or high-severity one always does.
The five NCR disposition options
Every NCR must end with one of these decisions on the affected item.
| Disposition | What it means | When it applies | Approval needed |
|---|---|---|---|
| Rework | The item is brought back into full conformity with the original requirement. | The defect can be removed without deviating from spec — re-weld, re-machine, re-coat. | Quality function; re-inspection to original criteria. |
| Repair | The item is made fit for purpose but does not fully meet the original requirement. | Full conformity is impractical and a documented repair procedure exists. | Design authority, usually with client concession. |
| Use as is / concession | The item is accepted in its nonconforming state. | Technical assessment shows no impact on fitness, safety or life. | Design authority and customer — never quality alone. |
| Regrade | The item is reclassified for a lower-duty application where it conforms. | Material or component is acceptable elsewhere in the scope. | Design authority; re-identification and re-marking required. |
| Reject / scrap | The item is rejected, made unusable and removed from the supply chain. | Nothing above is defensible, or the defect affects safety-critical function. | Quality function; physical control so it cannot re-enter production. |
One NCR, followed from detection to closure
A third-party inspector attends a witness point at a fabrication shop and measures dry film thickness on a batch of coated spools. Here is the record the NCR produced.
| Stage | Entry on the NCR |
|---|---|
| Identification | NCR-2026-041. Spools SP-1012 to SP-1020 (9 units of 40), PO 4501, coating batch C-228. |
| Requirement | Coating specification JAS-CT-04 §5.2: minimum DFT 250 µm, 80/20 rule per SSPC-PA 2. |
| Evidence | DFT readings 180–210 µm across 9 units, gauge SN 44821 calibrated 12 Jan 2026, 24 photographs, inspector S. Rao, 3 March 2026. |
| Extent | Remaining 31 units of the batch re-measured and conforming. Previous two shipments (PO 4498, 4499) recalled to DFT verification; both conforming. |
| Containment | 9 units quarantined in bay 4 with red HOLD tags; batch release blocked in the shop MRP. |
| Proposed disposition | Supplier proposes use-as-is, arguing service environment is internal and dry. |
| Approved disposition | Rejected. Design authority requires full DFT for the specified C5-M external exposure. Disposition changed to rework: abrasive-blast to bare metal and re-coat to full system. |
| Verification | Re-coating completed 11 March; DFT re-measured 268–310 µm across all 9 units; holiday test passed; re-inspection report IR-2026-118 attached. |
| Closure and escalation | NCR closed 13 March. Third DFT non-conformance from this vendor in six months, so CAPA-2026-009 raised on the vendor's wet-film control and in-process check. |
Note where the value was created: the extent check that pulled back two earlier shipments, the refusal of an unjustified use-as-is, and the escalation to CAPA once a pattern was visible. The paperwork itself changed nothing.
NCR vs CAPA — where one ends and the other begins
The most common audit finding on non-conformance control is closing NCRs without ever asking why they keep appearing.
| NCR | CAPA | |
|---|---|---|
| Question it answers | What do we do with this item? | Why did this happen, and how do we stop it recurring? |
| Subject | A specific product, batch, service or process output. | The cause in the system that allowed it. |
| Standard clause | ISO 9001:2015 §8.7 — control of nonconforming outputs. | ISO 9001:2015 §10.2 — nonconformity and corrective action. |
| Typical duration | Days — the item is waiting on the decision. | Weeks to months, including effectiveness verification. |
| Closure criterion | Disposition executed and re-verified. | Root cause removed and effectiveness proven with data. |
| Trigger for the other | Repeat, severe or systemic NCRs should raise a CAPA. | A CAPA may reveal further nonconforming stock, raising new NCRs. |
A practical rule: define escalation criteria in the procedure rather than case by case. Common triggers are any safety-related non-conformance, any customer-detected non-conformance, any third repeat of the same type within a rolling twelve months, and any single event above a defined cost threshold.
Understand the other half of the loop
Our CAPA pillar explains corrective and preventive action end to end — the eight stages, root-cause methods and effectiveness verification.
Where NCR systems go wrong
Unwritten NCRs
Issues resolved verbally on the shop floor never reach the register, so the trend data that would justify a CAPA never exists.
Vague findings
"Weld quality poor" cannot be dispositioned or defended. Cite the criterion and the measurement.
Extent not assessed
The batch in front of you is contained, while identical material produced last week ships.
Disposition by convenience
Use-as-is chosen because the schedule is tight, not because a technical assessment supports it.
Closure without re-inspection
Rework recorded as complete with no re-test evidence attached — the most common audit finding against §8.7.
No trending
A register nobody analyses by type, supplier and cause is a filing cabinet, not a control.
Independent eyes make NCRs stick
Non-conformances are commercially uncomfortable: they delay releases, and the party that caused them usually proposes the disposition. Independent inspection changes that dynamic — the finding is evidenced, the extent is properly assessed, and use-as-is has to be justified rather than assumed.
Need non-conformances caught before shipment?
Our third-party inspectors work to your ITP hold and witness points, raise evidenced NCRs and verify dispositions before release.
Recurring non-conformances?
We run independent root-cause investigations and verify effectiveness, so the same NCR stops coming back.
Questions we get on this topic
What is a non-conformance report (NCR)?
A non-conformance report is the formal record raised when a product, material, service or process fails to meet a specified requirement from a drawing, specification, code, procedure or purchase order. It identifies the affected item, states the requirement breached and the objective evidence, records containment, and documents the approved disposition and its verification before closure.
What does NCR stand for?
NCR stands for non-conformance report, also written as non-conformity report. Some quality systems use NCN (notice of non-conformance) or NC report for the same document. A CAR, or corrective action request, is different: it addresses the cause rather than the affected item.
What is the difference between an NCR and a CAPA?
An NCR deals with the item: it controls nonconforming output and decides whether it is reworked, repaired, used as is, regraded or scrapped, under ISO 9001 clause 8.7. A CAPA deals with the cause: it investigates why the non-conformance happened, removes that cause and verifies the action was effective, under clause 10.2. Repeat or severe NCRs should escalate into a CAPA.
What are the disposition options for an NCR?
There are five: rework, which restores full conformity; repair, which makes the item fit for purpose without meeting the original requirement; use as is, accepting the item under a concession; regrade, reclassifying it for a lower-duty use where it conforms; and reject or scrap. Repair, use as is and regrade require design authority approval and usually customer concession.
Who can close a non-conformance report?
Closure is authorised by the quality function once the approved disposition has been carried out and verified — re-inspection or re-test evidence against the original acceptance criteria must be attached. The person who approved the disposition should not be the only signature on closure, and dispositions against design requirements need design authority sign-off.
Does ISO 9001 require non-conformance reports?
ISO 9001:2015 clause 8.7 requires organisations to identify and control nonconforming outputs to prevent unintended use or delivery, and to retain documented information describing the nonconformity, the actions taken, any concessions obtained and the authority deciding the action. The standard does not mandate a form called an NCR, but that documented information is what an NCR provides.
How long should an NCR stay open?
Most organisations set targets by severity — containment within 24 to 48 hours, disposition decided within five to ten working days, and closure once the disposition is executed and re-verified. Ageing matters more than the absolute number: NCRs open beyond target usually indicate a stalled disposition decision, not a slow inspector.
What is the difference between a non-conformance and an observation?
A non-conformance is a demonstrated failure to meet a stated requirement, supported by objective evidence, and it requires a disposition on the affected item. An observation flags a weakness or emerging risk where no requirement has yet been breached; it is tracked and may prompt improvement, but it does not control product.
Stop non-conformances at the source
Independent inspection, evidenced NCRs and verified dispositions — so nonconforming work never leaves the shop as conforming.