{"id":10306,"date":"2020-01-07T16:16:01","date_gmt":"2020-01-07T14:16:01","guid":{"rendered":"https:\/\/factorialhr.com\/blog\/?p=10306"},"modified":"2023-10-13T17:38:44","modified_gmt":"2023-10-13T15:38:44","slug":"conducting-an-hr-audit","status":"publish","type":"post","link":"https:\/\/factorialhr.com\/blog\/conducting-an-hr-audit\/","title":{"rendered":"Your Practical Guide to an Effective HR Audit"},"content":{"rendered":"<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">An HR audit is a method through which the company\u2019s policies, internal procedures, documentation, and human resources processes are reviewed. Otherwise known as<\/span><b> systematically reviewing all aspects of the company<\/b><span style=\"font-weight: 400;\">. An audit of this type is valuable for identifying the key areas for improvement within the organization.\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Under federal laws, in some countries, companies are advised to conduct audits to ensure HR compliance. Conducting an audit of this type may also serve as proof the company is abiding by certain labor rules and regulations. We advise that you review the laws in your jurisdiction to<\/span><b> know whether an audit of human resources is required by law<\/b><span style=\"font-weight: 400;\">. And, even if not mandatory, it is advisable for all companies to conduct an audit of their HR processes.<br \/>\n<\/span><\/p>\n<ul>\n<li><a href=\"#why\">Why Perform an HR Audit?<\/a><\/li>\n<li><a href=\"#types\">Types of Human Resources Audits<\/a><\/li>\n<li><a href=\"#steps\">Steps to Perform an HR Audit<\/a><\/li>\n<li><a href=\"#benefits\">Benefits of Conducting an HR Audit<\/a><\/li>\n<li><a href=\"#ensuring\">Ensuring Compliance with an HR Audit Checklist<\/a><\/li>\n<\/ul>\n<h3><a href=\"https:\/\/factorialhr.com\/templates\/download-free-hr-audit-checklist\"><img decoding=\"async\" class=\"alignnone size-medium wp-image-86549\" src=\"https:\/\/factorialhr.com\/wp-content\/uploads\/2022\/08\/18151232\/HR-Audit-checklist-NEW-300x300.jpg\" alt=\"\" width=\"300\" height=\"300\" srcset=\"https:\/\/factorialhr.com\/wp-content\/uploads\/2022\/08\/18151232\/HR-Audit-checklist-NEW-300x300.jpg 300w, https:\/\/factorialhr.com\/wp-content\/uploads\/2022\/08\/18151232\/HR-Audit-checklist-NEW-150x150.jpg 150w, https:\/\/factorialhr.com\/wp-content\/uploads\/2022\/08\/18151232\/HR-Audit-checklist-NEW-160x160.jpg 160w, https:\/\/factorialhr.com\/wp-content\/uploads\/2022\/08\/18151232\/HR-Audit-checklist-NEW-80x80.jpg 80w, https:\/\/factorialhr.com\/wp-content\/uploads\/2022\/08\/18151232\/HR-Audit-checklist-NEW.jpg 525w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/a><\/h3>\n<h3><!-- end HubSpot Call-to-Action Code --><\/h3>\n<h2><strong><a name=\"why\"><\/a>Why Perform an HR Audit<\/strong><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">If you\u2019re still wondering why you should consider performing a human resources audit, continue reading on to find out more. We\u2019ll take you through the most common <\/span><span style=\"font-weight: 400;\">types of audits<\/span><span style=\"font-weight: 400;\">, the <\/span><span style=\"font-weight: 400;\">steps to perform a successful audit of HR<\/span><span style=\"font-weight: 400;\">, and the <\/span><span style=\"font-weight: 400;\">benefits of an audit<\/span><span style=\"font-weight: 400;\">. We\u2019ve even added an <\/span><b>HR audit checklist <\/b><span style=\"font-weight: 400;\">to help you along.\u00a0<\/span><\/p>\n<h2><a name=\"types\"><\/a><b>Types of Human Resources Audits<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">There are<\/span><b> four main types<\/b><span style=\"font-weight: 400;\"> of human resources audits that are most commonly conducted. All of the following audit types involve systematically reviewing the human resources function of the company.\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400; text-align: justify;\"><b>Comparative Approach Audit (Internal)<\/b><span style=\"font-weight: 400;\">: In this type of audit, two human resources management departments are compared. The first is your company, who is performing the actual audit. The second department to compare is that of another company, in which changes have already been applied after an audit. <\/span>Using the competitive approach is best when a company is new to performing HR Audits and is unsure of how to create a plan of action following an audit. Mirroring the successful plan of action of another company is often a good place to start.<\/li>\n<li style=\"text-align: justify;\"><b>Expert Audit (External): <span style=\"font-weight: 400;\">In this case, auditing a human resource management process is carried out by an individual or external company outside of the organization. The company conducting the audit is one that is specialized in conducting and analyzing a human resources audit.\u00a0<\/span><\/b><\/li>\n<li style=\"text-align: justify;\"><b>Statistical Approach Audit<span style=\"font-weight: 400;\">: In this type, substantial weight is put on the collection and analysis of data within the company to access overall performance. Examples of data that may be beneficial to an audit of your HR are absenteeism or high turnover rates.\u00a0<\/span><\/b><\/li>\n<li style=\"font-weight: 400; text-align: justify;\"><b>Management by Objectives Audit<\/b><span style=\"font-weight: 400;\">: This type of audit is based on the comparison of results market by the department vs. the actual results achieved.\u00a0<\/span><\/li>\n<\/ul>\n<h2><a name=\"steps\"><\/a><strong>Steps to perform an HR Audit<\/strong><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">If you are thinking about conducting an audit of your company, it\u2019s likely you may be feeling a bit stressed. Are you wondering where to start, which steps to take, and who will be the one performing the audit? There\u2019s no need to sweat!\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Our recommendation is that you start by <\/span><b>defining which HR function or processes you would like to evaluate <\/b><span style=\"font-weight: 400;\">under the audit. For example, the human resources programs you use, the policies of the HR department, or performance evaluations. You can also decide to evaluate the environment or other processes that are of interest. If there is an area in your company where you feel requires improvement and enhancement, you should consider adding it in the audit as well.\u00a0<\/span><\/p>\n<p><iframe title=\"HR Audit Checklist: How To \u2611\ufe0f\" width=\"500\" height=\"281\" src=\"https:\/\/www.youtube.com\/embed\/QIjCE9Wrx04?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/p>\n<p style=\"text-align: justify;\"><b>As soon as you have identified all of the above, you can continue with the next HR audit process steps:<\/b><\/p>\n<ol>\n<li style=\"font-weight: 400; text-align: justify;\"><span style=\"font-weight: 400;\">Decide whether the audit will be <\/span><b>conducted internally or externally<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400; text-align: justify;\"><b>Define the audit type<\/b><span style=\"font-weight: 400;\"> you want to carry out.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400; text-align: justify;\"><b>Establish clear and defined objectives<\/b><span style=\"font-weight: 400;\"> to result from the audit.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400; text-align: justify;\"><b>Create a plan of action <\/b><span style=\"font-weight: 400;\">to arrive at your objectives.<\/span><\/li>\n<li style=\"font-weight: 400; text-align: justify;\"><b>Collect the information<\/b><span style=\"font-weight: 400;\"> and form your conclusions.<\/span><\/li>\n<li style=\"font-weight: 400; text-align: justify;\"><b>Prepare a report <\/b><span style=\"font-weight: 400;\">with the results of the audit.\u00a0<\/span><\/li>\n<\/ol>\n<p>If you want more information on how to conduct an HR audit, continue reading below, or visit the quick read on and <a href=\"https:\/\/factorialhr.com\/blog\/checklist-hr-audit\/\" target=\"_blank\" rel=\"noopener noreferrer\">effective HR audit checklist<\/a>.<br \/>\n<!-- end HubSpot Call-to-Action Code --><\/p>\n<h2><a name=\"benefits\"><\/a><strong>Conducting an HR Audit &#8211; Benefits<\/strong><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">The truth is that there are many advantages to carrying out a company audit. Without a doubt, the most valued is that it provides you with a broad vision of the inner workings of your company. The audit often reveals how the human resources department fulfills its daily functions.<\/span><\/p>\n<p style=\"text-align: center;\"><b>An audit is a comprehensive tool used to analyze multiple aspects of a company. Conducting an audit is essential to a company\u2019s growth and improvement.\u00a0\u00a0\u00a0<\/b><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Knowing the inner workings of your organization, allows your company to detect potential complications and\/or areas of improvement. Also, as a result of conducting an audit, you can expose the positive aspects of the company. On the other hand, areas that could benefit from extra reinforcement are highlighted.<\/span><\/p>\n<h3><b>Main advantages of performing an HR audit:<\/b><\/h3>\n<ul>\n<li>\n<h4 style=\"text-align: justify;\"><b>Provides a detailed vision of the human resources department<\/b><\/h4>\n<\/li>\n<\/ul>\n<p style=\"padding-left: 40px; text-align: justify;\"><b><\/b><b><span style=\"font-weight: 400;\">Understanding how each area of the department works, and how they integrate into the company, is essential to moving forward with the company\u2019s objectives.<\/span><\/b><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\">\n<h4><b>Encourages compliance<\/b><\/h4>\n<p><span style=\"font-weight: 400;\">It is in a company\u2019s best interest to ensure compliance with ever-changing rules that are present within the industry. For example, a human resources audit helps to encourage compliance with the labor standards act, among others.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\">\n<h4><b>Promotes positive change<\/b><\/h4>\n<\/li>\n<\/ul>\n<p style=\"padding-left: 40px; text-align: justify;\"><b><\/b><b><span style=\"font-weight: 400;\">Evolving is crucial and identifying a company\u2019s weaknesses\/possible pain points, enables them to better form a plan of action and implement it to improve.\u00a0\u00a0<\/span><\/b><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\">\n<h4><b><\/b><b>Provides valuable data<\/b><\/h4>\n<\/li>\n<li style=\"list-style-type: none;\"><b><span style=\"font-weight: 400;\"> If you are a regular reader of the blog, you know that we love speaking about the collection of reliable data. Why? This data allows a company to quantify aspects of their HR department that may have previously been neglected. With an audit, you can retrieve valuable data that, after proper analysis, will help guide you to make the correct decisions later on.\u00a0<\/span><\/b><\/li>\n<\/ul>\n<p><!--HubSpot Call-to-Action Code --><span id=\"hs-cta-wrapper-2493a455-07a7-4965-9faf-ec449b8bbc5b\" class=\"hs-cta-wrapper\"><span id=\"hs-cta-2493a455-07a7-4965-9faf-ec449b8bbc5b\" class=\"hs-cta-node hs-cta-2493a455-07a7-4965-9faf-ec449b8bbc5b\"><!-- [if lte IE 8]>\n\n\n<div id=\"hs-cta-ie-element\"><\/div>\n\n\n<![endif]--><a href=\"https:\/\/cta-redirect.hubspot.com\/cta\/redirect\/4960096\/2493a455-07a7-4965-9faf-ec449b8bbc5b\" target=\"_blank\" rel=\"noopener\"><img decoding=\"async\" id=\"hs-cta-img-2493a455-07a7-4965-9faf-ec449b8bbc5b\" class=\"hs-cta-img aligncenter\" style=\"border-width: 0px;\" src=\"https:\/\/no-cache.hubspot.com\/cta\/default\/4960096\/2493a455-07a7-4965-9faf-ec449b8bbc5b.png\" alt=\"New call-to-action\" width=\"900\" height=\"308\" \/><\/a><\/span><script charset=\"utf-8\" src=\"https:\/\/js.hscta.net\/cta\/current.js\"><\/script><script type=\"text\/javascript\"> hbspt.cta.load(4960096, '2493a455-07a7-4965-9faf-ec449b8bbc5b', {\"region\":\"na1\"}); <\/script><\/span><!-- end HubSpot Call-to-Action Code --><\/p>\n<h2><a id=\"ensuring\"><\/a>Use an HR Audit Checklist to Ensure Compliance<\/h2>\n<p><span style=\"font-weight: 400;\">It\u2019s important to keep in mind, that an audit is a great opportunity to learn and continue creating. It is in no way a negative assessment of the work that your HR department has performed. Using a checklist for HR audit processes ensures you don&#8217;t miss anything.<\/span><\/p>\n<p style=\"text-align: justify;\"><b>Still not sure about the key factors to successfully conduct an audit?\u00a0<\/b><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">An audit is a key moment for the department and the company as a whole, so they can learn and keep moving forward as an HR professional. If you continue to see an audit as an opportunity instead of understanding it as a threat, you will surely be able to carry out the process successfully.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>An HR audit is a method through which the company\u2019s policies, internal procedures, documentation, and human resources processes are reviewed. Otherwise known as systematically reviewing all aspects of the company. An audit of this type is valuable for identifying the key areas for improvement within the organization.\u00a0 Under federal laws, in some countries, companies are<a href=\"https:\/\/factorialhr.com\/blog\/conducting-an-hr-audit\/\" class=\"read-more\"> [&#8230;]<\/a><\/p>\n","protected":false},"author":136,"featured_media":10351,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-10306","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-human-resources"],"acf":{"topics":"core"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v21.5 (Yoast SEO v21.9.1) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Conducting your HR Audit (Practical Guide) | Factorial Blog<\/title>\n<meta name=\"description\" content=\"Do you know how to conduct an HR audit? 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