HR _AUDIT-IV

8/19/2019 HR _AUDIT-IV

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HR AUDIT


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Human Resource Audit

– HR audit refers to an examination andevaluation of policies, procedures andpractices to determine the eectiveness andeciency of HRM

– HR Audit covers asically three thin!s

"#Measurement and evaluation of personnelpro!rammes, policies and practices#

$#Identi%cation of !ap et&een o'ectives andresults( and

)#Determination of &hat should or &hat shouldnot e done in future#


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urpose an a ure oaudit

– HR audit is a tool &hich helps to assesseectiveness of HR functions of anor!ani*ation

– +ocus on analy*in! and improvin! – To reveal the stren!th and &eaness

– HR audit is a dia!nostic tool, not a

prescriptive instrument


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Benets of HR audit

– Identi%cation of the contriutions of theHR department to the or!ani*ation

– Improvement of the professional ima!e

of the HR department – -ncoura!ement of !reater responsiility

and professionalism amon! memers of

the HR department – .timulation of uniformity of HR polices

and procedure


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Benets of HR audit

– +indin! critical personnel prolems

– -nsurin! timely compliance &ith le!alre/uirements

– Reducin! of HR costs

– 0reation of increased acceptance of thenecessary chan!es in the HR dept


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Areas of HR Audit

Audit of:

– HR function

– Mana!erial compliance

– HR 0limate

– 0orporate strate!y


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Audit of human resource function

– Determination of o'ectives of eachactivity

– Identi%cation of responsiility of

performance – Revie& of performance

– Developin! an action plan to correct

deviations et&een results and !oals – +ollo&1up of action plan


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Audit of managerial compliance

– This covers audit of mana!erialcompliance of personnel policies,procedures, and le!al and &elfare

provisions# – 0ompliance &ith the le!al provisions is

most important as any violation maesthe mana!ement !uilty of an oence#


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Audit of human resource climate

– The &orin! culture in any industry hasan impact on employee motivation,morale, 'o satisfaction, employee

asenteeism, safety records andemployee &elfare#


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Audit of corporate strategy

– This helps the industry to !ain acompetitive advanta!e y analy*in! the.23T analysis of the industry, the

mana!ement can tae decisionsre!ardin! maretin! channels, services,innovations, lo& cost production andother lie decisions#


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Frequency of Audit

• Annual audit of almost all thepersonnel policies and practices#

• 0ertain indicators lie asenteeismand employees4 !rievances shoulde audited at the end of everymonth5/uarter dependin! upon the

issues#


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Types of Audit

• Internal audit is done y theemployees in the personneldepartment

• -xternal audit may e conducted yexternal specialists or consultants inpersonnel mana!ement#


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Approaches to HR Audit

– 0omparative approach

– 3utside authority approach

– .tatistical approach

– 0ompliance approach

– Mana!ement y o'ectives 6M738approach


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1 !omparati"e approach

– In this, the auditors identify 0ompetitor0ompany as the model# The results oftheir or!ani*ation are compared &ith

that of the Model 0ompany5 industry#


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# $utside authority approach

– In this, the auditors use standards set yan outside consultant as enchmar forcomparison of o&n results#


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) %tatistical approach

– In this, .tatistical measures areperformance is developed considerin!the company4s existin! information#


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& !ompliance approach

– In this, auditors revie& past actions tocalculate &hether those activitiescomply &ith le!al re/uirements and

industry policies and procedures#


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' (anagement )y o)*ecti"es+(B$, approach

– This approach creates speci%c !oals,a!ainst &hich performance can emeasured, to arrive at %nal decision

aout industry4s actual performance&ith the set o'ectives#

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HR _AUDIT-IV