I recommend the Nikon S-10 Coolpix digital camera.  It has an internal focusing lens set, and is the only camera with a standard lens that has a macro-focus distance of 20 mm.  The body is split in the middle and rotates about 300 degrees.

I've seen the pictures taken with the camera Joe is talking about...it does a good job.

As an inspector following in behind another, you just get a better feeling of the job when you can see pictures of what the previous inspector has taken of the work in his/her reports. Documentation with pictures in reports of any problems or items that may need approval from the EOR is great to see. The ole addage that a picture is worth a thousand words is never truer in a case like this. All parties involved can see exactly what is involved and can make better decisions based on the report.

Other than the good advice already given, I'd add a few things.
Using excel does ok, but so does word if properly formated and to my mind, it's a bit easier to use when it comes to embedding multimedia such as video.
I would also add that if your going to do this, it would be advisable to pick up a book on photography. Things like proper use of the Fstop, photographic law of thirds, and the host of other matters related can go a long way to creating the image needed to make your point.

Which goes to another point. A lot of people make these little tinny photos and expect them to work. I always take mine in maximum resolution, and keep that as the master photo for that particular one. I can shrink it to fit a report form, but should anyone have questions later, I have a full res version to send along.
It should also be remembered that the photo needs to be an accurate representation of what your looking at. Lighting and magnification can make a 1/16" crack look like like the grand canyon. While that big image of a crack may be an attention grabber, as a mimimum, always use a scale so the image is not mis-representing actual values.

My two cents worth,
Gerald

I build most of my forms in Excel, usually adding the Excel sheet into a word document because I have templates with company logo or disclaimer built in to those.  Once this is done, you just call-up the word document, click on the main body and it opens the Excel file allowing you to add data.  Once the reports are complete, I convert to an Adobe (.pdf) file.  Mostly for security, but some of my reports have several pages of photographs and Adobe creates a smaller file making it easier to e-mail.  The newest version of Adobe allows you to create fill-in-the-blank forms from any form (computer generated or scanned). This is very handy if you need to use non-electronic forms. 

I have been through many cameras in 30 years.  High and low end SLR's, Polaroid's and about 5 digital models.  I like the upper end models (as photography is a hobby) but job site's will take their toll on cameras.  The Sony "H" series cameras have been very good to me ($500 range) and late last year I purchased a couple of Canon 570's ($180 range) There are many good camera choices for documentation out there. You need to review features and your budget.

Some things I would recommend would be:

1.  A camera that uses rechargeable AA batteries.  These are the easiest to work with and in a real bind, you can use standard AA's.

2.  Get a camera with a screw on lens extension and a clear filter.  This keeps all of the dust out of the moving parts of the camera lens.  The clear filter also takes all of the splatters or stray sparks.

3.  A camera with a large preview screen.  Small screens make it impossible to accurately preview your pictures.  Also get clear protector sheets for the screen.

4..  Buy a good hard side case.  In mine you can see a mini tripod, batteries, USB cables, memory cards and USB card reader.

5.  Get a good photo program for your laptop.  Some digitals tend to shoot "undersharp" pictures which can be easily corrected, as can conditions of poor lighting or contrast.  You will also be able to add specific identification, notes or arrows to your photographs as well.

6.  Remember that most digital cameras also record video, sometimes even a 30 second video can show much more information than a series of photos.

I used an access database with tables setup for customer>projects>purchase order> PO Line Items> inspections performed> related pictures etc. The pictures are best linked as opposed to imbedded as an OLE object as that causes the database to bloat.

Excel will also work as a table with links to pictures or you can embed them in reports generated with most office software. The problem with using individual forms and reports for puctures is the inability to easily search for them later however it is a much simpler setup.

Things to remember for me when using a camera for inspections have been

1) Use the macro setting for pictures showing detail NOT zooming in digitally.
2) Flash for macro pictures can sometimes wash out the picture. I have placed a small piece of white paper over the flash to soften shadows. Additional handheld lighting helps but changes the color balance slightly.
3) If the camera has a voice record or movie feature, I use it to record information about the shot.
4) Small tabletop tripods can be helpful in low light situations requiring longer shutter speeds. Natural lighting seems to work better than flash but requires the camera to be steady.

Have a nice day

Gerald
http://weldingdata.com/