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How HR Audit Is Defined?

Auditing, As the name defines is all about identifying the shortcomings, lapses, gaps in the function of a system. In the same way Human Resource is also a vertical of a company operations and should undergo the process of auditing once a year, so that the performance of the HR department in terms of the selection process, compensation bands, payroll management, and other processes are carried out at its best and is reducing the Organization’s liability as a whole.

In short – Auditing is a tool, which helps a company to determine if a particular function is operating a way it is meant to and is covering everything it is chartered to cover. It is a prescriptive instrument, not a diagnostic tool. It helps a manager to identify what is missing or needs improvement. But it can’t tell what else is necessary to do to address the issue.  

It is a comprehensive method to review current human resource policies, procedures, documentation and system to identify needs for improvement and enhancement of the HR function while ensuring compliances are aligned to the ever changing rules and regulations. An Audit is basically all about systematically reviewing all aspects of Human Resource as a function, usually in a checklist function.

HR Auditing is most effective when an Organization is ready to act on the findings, evolving and develop a function in support to the company’s Mission and Vision.  Here, let’s have a look at what makes a perfect blend for a successful HR Audit.

8 Steps For Successful HR Auditing

  1. Determine The Scope
  2. Settingup a Proper Plan
  3. Gathering Data For Analysis
  4. Benchmark The Good Practices
  5. Working With The Designated Authority
  6. Creating Reports
  7. Creating A Plan Of Action
  8. Continious Planning and Evaluating Process

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  1. Determining The Scope

    The scope of work can be determined by understanding what is that one is looking from the HR Audit process. You can check the below parameters to define your scope.

    • What Is Your Corporate Strategy?

      You can take measures to get a competitive edge in the market.

    • How is your HR Department Functioning?

      Check the Covering verticals like – Staffing &Development, Organization Control, Information and system, Evaluation/Appraisal system.

    • Is Your Company Is Complying With Present Laws?

      Human Resource policies and procedures to be kept under check and if we not following we need to keep an eye to manage it properly eliminate the extra burdens.

    • Know Your Employee Satisfaction

      Learn how employees needs can be met and how well are they satisfied in their work environment. Hence, to determine the scope of work is utmost and the basic step, this helps us to plan for an earlier stage to take it further by knowing what we can achieve from the HR Auditing.

  1. Setting Up A Proper Plan

    Here we have to look at our milestones, short, long term goals and timelines to set up a proper plan. Then aligning the subject experts for each of the areas. For this process, one is required to creating a holistic questionnaire to provide consistency in the data gathering process.

RELATED TOPIC : All You Need To Know About Managing Your HR Department

  1. Gathering Data For Analysis

    After the scope of work and the approach is determined, our plan is in place, for auditing purposes. Now we have to gather all the possible data that is applicable in the organization currently.You may be thinking why do i need to gather data? Because as we are going through the auditing process we should understand the present scenario and act accordingly to take the next action.Out of all the steps, this is the most time consuming step in the entire process of auditing. Hence with the help of the questionnaire developed in the previous step one can access the current state in a robust manner.

  2. Benchmarking The Good Practices:

    Gathering of data, analysing, reviewing them needs to include some benchmarking according to the Industries standards. Hence, the research needs to include best practices in place for a particular setup according to the Industries standards. Hence important to know required metrics and other factors before Auditing, so that we can filter at this stage what’s working and what is not working for the organization to take a proper decision.

  3. Working With The Designated Authority:

    Once the basic information regarding where are we looking, what are we trying to achieve, what industry standards we choose to imply to, what are the findings against the questionnaires. One is required to discuss the findings, errands and clear doubts with the designated authority from the client company before drawing any conclusions.

RELATED TOPIC : Know Why You Have To Do HR Audit For Your Company?

  1. Creating Reports

    Report making, this is where one is required to lay down all the findings and the conclusions drawn from the process of auditing. The report should ideally identify any strengths, gaps found during the audit, and recommendations to be given for correcting any instances of noncompliance.

  2. Creating A Plan Of Action

    Once the basic is served of gathering information, reviewing them and creating a conclusion for better means and progressive ways of doing things, the next very important step is to reach a point of action through these findings. Hence, once the report is prepared the audit team is required to discuss in-depth the findings and put a plan into action for covering gaps and adopting new processes and policies according to the scope of work determined earlier with an objective.

  3. Continuous Improvement And Evaluating The progress

    After all, is done, the key to determine the success is continuous evaluation and reviewing the plan of action which is put in place. The basic necessity of this is to grow further and closer to the goals instead of doing and undoing the ways in which the processes function.

These are the eight primary stages helps in conducting a successful HR Auditing. But, many organizations do the audit, but fail to engage their HR leaders in implementing the successful strategies. If you think you are one of them or your team is struggling to do the Human Resource Audit, we as a HR Function Management Company is here to hold your hand and walk you through success. You can write us at reach@husys.net for any support.

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