HR audit has emerged from the practice of yearly finance and accounting audit and it is as mandatory as finance and accounting audit for every company.
HR audit by GDG Professionals serves as an examination on a sample basis of practices and systems for identifying problems and ensuring that sound HR policy - procedures/ principles are followed within company. HR audit also serves as a means through which an organization can measure the health of its human resource function.
A healthy HR function in an organization is as important as the physical and mental well being of a human body. Typically the basic reason why organizations prefer to conduct an HR audit is to get a clear judgment about the overall status of the organization and also to find out whether certain systems put in place are yielding any results. HR audit also helps companies to figure out any gaps or lapses and the reason for the same. Since every company plans certain systems and targets, an HR audit compares the plans to actual implementation.
GDG Professionals approach to HR audit is a systematic process, which examines the important aspects of the function and its management, and is a mean to identify strengths, weaknesses and areas where rectification may be warranted. Depending on clients’ request an audit is done on sampling basis. And in sampling, not every instance or situation can be examined.
Also depending on clients request GDG Professionals conduct HR audit within organization for multiple purposes. Some of the more common reasons are:
- To identify and address HR-related problems
- To seek out HR-related opportunities
- To ensure effective utilization of human resources
- To review compliance with tons of laws and regulations
- To instill a sense of confidence in the human resource department that it is well-managed and prepared to meet potential challenges and opportunities
- To maintain or enhance the organization's reputation in a community
How an audit is conducted is very often determined by its intended use. For instance, the type of audit used to ascertain HR practices may be significantly different from the type of audit used to support an initial public offering. Although the areas examined may be similar, the process used and the depth of inquiry will vary from the intended outcome.
Line and Operating managers have more respect for the HR department as an audit team of GDG Professionals meets them and seeks their view on HRM within company. As the comments of manager are acted on, HR department become more responsive to their needs. And since HR is service department, these actions influence to improvementof its contribution to organizational objectives.
The audit process
The HR audit process is conducted in different phases by GDG Professionals. Each phase is designed to build upon the preceding phase so that the organization will have a very strong overview of the health of the HR function, at the conclusion of the audit. These phases include:
- Pre-Audit Information
- To give information re strarting date
- On-site Review
- Records Gathering
- Records analysis
- Audit Report
- Using/implementing audit findings
Benefits of HR Audit to Companies
Importantly, HR audit can analyze failures and fix responsibilities logically. It frees the organization from politics, blame-game and excuses for non performance, bringing in a new culture of professionalism.
The significance of a HR audit done by GDG Professionals is that it recognizes the importance of creating the right environment and thereby facilitating long term productivity improvement.
Several benefits associated with Human Resource audit are listed below. An audit reminds member of HR department and others its contribution, creating a more professional image of the department among manager and specialist. The audit helps clarify the department’s role and leads to greater uniformity, especially in the geographically scattered and decentralized HR function of large organisations. The most important side of HR audit by GDG Professionals is that it finds problems and ensures compliance with Labour Law and strategic plans in an organization.
- Identifies the contribution of Human Resource department to the organization
- Improves the professional image of the Human Resource department
- Encourages greater responsibility and professionalism among member of the Human Resource department
- Clarifies the HR department’s duties and responsibilities
- Stimulates uniformity of HR policies and practices
- Finds critical HR problems
- Ensures timely compliance with legal requirements
- Reduces human resource cost through more effective Human Resource procedure
- Creates increased acceptance of needed change in the Human Resource department
- Requires thorough review of Human Resourcedepartment’s information system
Besides ensuring compliance, an HR audit done professionally improves the department’s image and contribution to the company.