What Is Non-Conformance Report (NCR)?
Also known as: NCR, nonconformance report, discrepancy report, defect report
Definition
A non-conformance report (NCR) is the formal record that a part, material, process or document failed a specified requirement. It captures what failed, how many, where, and the disposition decision (use as is, rework, repair, scrap or return to supplier).
Non-Conformance Report (NCR) Explained
An NCR is the unit of record in a quality system for anything that does not meet drawing, specification, contract or procedure. It is raised by receiving inspection, in-process inspection, final test, a customer return, or an auditor. A good NCR identifies the item and revision, the lot or serial number, the quantity affected, the requirement violated, the measured result, who found it and at which operation.
Disposition is the heart of the document. Typical outcomes are use as is (needs engineering and often customer concession), rework to the original requirement, repair to a different but accepted state (customer approval is usually required in aerospace), scrap, or return to vendor. The NCR also decides whether the stock is quarantined, which stops MRP, picking and shipping from touching it until a disposition is recorded.
In ERPs the NCR lives in the quality module and is linked to inventory. Infor SyteLine records rejects and quality holds through its quality control and inspection functions, and Infor LN ties rejected quantities to inspection orders and warehouse inspection locations. Standalone QMS tools such as MasterControl or ETQ hold the NCR and sync the stock status back to the ERP. The integration point that matters most is the inventory hold: an NCR that does not freeze the lot is only paperwork.
An NCR is not the same as a CAPA. The NCR deals with the affected product now, the CAPA deals with why it happened and stopping recurrence. Many organisations raise a CAPA only when NCRs on the same cause cross a threshold or when severity is high.
Why It Matters
- Standards such as ISO 9001 clause 8.7 and AS9100 require control of nonconforming outputs, with records of the disposition and who authorised it.
- An NCR that does not quarantine stock in the ERP lets suspect material get issued to a job or shipped to a customer.
- NCR data by supplier, part and cause is the raw material for Pareto analysis, supplier scorecards and CAPA triggers.
- Cost of scrap, rework and concessions is traceable only when each NCR carries a quantity and a cost, which feeds cost of poor quality reporting.
In Practice
Receiving inspection rejects 40 of 500 machined housings because a bore measures 0.02 mm over tolerance. The inspector raises an NCR, the 40 pieces move to a quarantine location and the ERP shows them as unavailable. The material review board dispositions 30 as rework (re-bore and sleeve) and 10 as return to vendor with a debit memo. Because the NCR holds the lot, MRP does not count those 40 as supply, and the buyer sees the shortfall that day instead of at kitting.
Frequently Asked Questions
What is the difference between an NCR and a CAPA?
An NCR records and dispositions the specific nonconforming product or event. A CAPA investigates the root cause and puts actions in place so it does not recur. One CAPA often covers many NCRs.
Who can approve an NCR disposition?
It depends on your quality manual. Rework to print is often approved by quality alone. Use as is or repair usually needs engineering and, for customer-controlled designs, customer approval.
Should an NCR block inventory in the ERP?
Yes. The NCR should move the affected lot to a quarantine or hold status so planning, picking and shipping ignore it until a disposition is recorded.
Is an NCR the same as a deviation or a concession?
No. A deviation or concession is permission to accept or ship product that does not meet requirements. It is one possible outcome of an NCR disposition, not the NCR itself.
Related Terms
Material Review Board (MRB)
A material review board (MRB) is a cross-functional group, usually quality, engineering and purchasing or manufacturing, that reviews nonconforming material and decides its disposition: use as is, rework, repair, scrap or return to supplier.
CAPA (Corrective and Preventive Action)
CAPA is a closed-loop quality process: investigate a problem, find its root cause, implement corrective action to remove it and preventive action to stop similar problems, then verify the actions were effective. Required by ISO 13485 and FDA rules, expected under AS9100.
Incoming Inspection (Receiving Inspection)
Incoming inspection, also called receiving inspection or IQC, verifies purchased material against the purchase order, drawing and specification before it is released to stock or production. Checks include documents, count, visual, dimensional and sometimes lab testing.
Rework
Rework is action taken on nonconforming product to bring it into full conformance with the original specification. It differs from repair, which makes product acceptable for use without meeting the original requirement.
Scrap Rate
Scrap rate is the percentage of production output discarded as unusable because it cannot be economically reworked to specification, calculated as scrapped units divided by total units produced over a defined period.
Go Deeper
Scrap Rate Cost Calculator
Turn your scrap percentage into an annual dollar figure - including labor and overhead absorbed by scrapped units - and see what each point of improvement is worth.
SyteLine Quality Hold Management Guide
Configure SyteLine quality hold and release processes for inventory control. Set up hold reasons, release workflows, and quarantine locations in CloudSuite Industrial.
SyteLine Receiving and Inspection Setup
Configure SyteLine receiving and quality inspection workflows. Set up PO receiving, inspection plans, and non-conformance triggers in CloudSuite Industrial ERP.
SyteLine Supplier Quality Management
Configure SyteLine supplier quality management for vendor quality scoring, incoming inspection tracking, and supplier corrective actions in CloudSuite Industrial.
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Medical Device NCR Labor, Rework and Scrap Cost Calculator
Builds a cost per NCR and an annual cost from NCR volume, burdened labor, MRB time, rework and scrap mix, and CAPA escalation rate. Includes a volume sweep.
Keep exploring
Free tools
- Medical Device NCR Labor, Rework and Scrap Cost CalculatorBuilds a cost per NCR and an annual cost from NCR volume, burdened labor, MRB time, rework and scrap mix, and CAPA escalation rate. Includes a volume sweep.
- NCR Nonconformance Report TemplateFill-in nonconformance report with containment, disposition and approval lines that exports to PDF, Word or Excel.
- ISO 13485 Nonconformance Report Template with Disposition and CAPA LinkAn NCR form for medical device manufacturers with disposition, risk assessment, concession approval and a CAPA decision.
ERP fixes and how-tos
- How to Sync an NCR From Your QMS to ERP Quarantine and MRB DispositionHow to wire a QMS nonconformance report to ERP inventory holds and MRB dispositions: quarantine on open, post scrap, rework or RTV on close, with the pitfalls.
- How to Add AI to ETQ Reliance or Another On-Prem QMSPrivate AI layer for ETQ Reliance and other on-prem QMS: NCR and CAPA search, document retrieval, API-based tools, role mirroring, local model, human approval.
Guides
- SyteLine Non-Conformance Report (NCR) Management ConfigurationConfigure SyteLine non-conformance report tracking and disposition workflows. Set up NCR creation, investigation, and resolution processes in CloudSuite Industrial.
- How to Configure Non-Conformance Reports in SyteLineLearn how to set up and manage non-conformance reports (NCRs) in Infor SyteLine. Configure defect codes, disposition workflows, cost tracking, and corrective action linkages for quality management.
- Infor M3 Quality Management System Configuration GuideHow Infor M3 supports quality management, product traceability and compliance in regulated manufacturing: inspection plans, lot status, non-conformance, CAPA.
AI on your ERP
- AI for Epicor Kinetic Quality: Non-Conformances, CAPA, Inspection and TraceabilityAI for Epicor Kinetic quality: summarize non-conformances, find repeat defects, draft CAPA and trace lots, with audit-ready logs and on-prem deployment.
- AI for SyteLine Quality: Nonconformance Reports and Inspection DataAI for Infor SyteLine quality: analyse NCR trends, inspection results and supplier defects, draft dispositions for review, and keep quality data private on-prem.