An HR Auditor Perspective: How to use audits in improving HR practice

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An HR Auditor Perspective: How to use audits in improving HR practice
by Moleko Rannona

Auditing is well established in the fields such as Finance and Health and Safety.  A Human Resource Department on the other hand is usually audited in bits and pieces as part of the aforementioned fields.  In many organisations, internal audit will add HR processes and policies to their remit, but this is not done in a systematic and integrated way.  Thus, Human Resources have not been audited independently until recently.

This is an anomaly as most organisations proclaim that human capital is their greatest asset. To correct this glaring deficiency, the SA Board for People Practices (SABPP) launched the National HR Audit Framework on 28 August 2014 so as to audit organisations against the thirteen National HR Standards, being Strategic HR Management, Talent Management, HR Risk Management, Workforce Planning, Learning & Development, Performance Management, Reward & Recognition, Employment Relations Management, Employee Wellness, Organisational Development, HR Service Delivery, HR Technology and HR Measurement. The establishment of formalised HR auditing heralds an exciting and progressive phase in the evolution of the HR profession.

I am one of the first group of Senior HR Professionals to be trained as Auditors and Lead Auditors.  It is an absolute honour to be part of the HR audit pioneers, but also a huge responsibility in repositioning the HR profession in organisations and society at large.

Audit Process:

An HR audit is conducted by a team of Auditors led by a Lead Auditor. The audit process commences with the organisation (auditee) contacting the SABPP Audit Unit and expressing the desire to be audited. The SABPP Audit Unit prepares the organisation in consultation with the Lead Auditor who has the responsibility to ensure that the appointed auditors are well prepared and co-ordinated to conduct the audit successfully.  From my experience, I found the team of auditors to be well prepared, professional and dedicated. The auditors exercised high level of integrity, independence and professionalism and observed a clear commitment to the principle of confidentiality.  With an explicit HR standards framework in place, clear guidelines and criteria for conducting the audit are in place.

The audit process consists of the scrutiny of documentary evidence and oral interviews using a random sample of employees and managers at the workplace of the auditee. During the audits it appeared that sometimes the organisations being audited were more concerned about the audit results than the process itself. This could stem from fear of the unknown as the notion of independent HR Audits is still in its infancy. It emerged during interviews that some employees were anxious about how they were selected for interviews and how the information that they provided is going to be used. Their concern diminishes once they had been assured that the focus of audit is on systems, policy and procedures, and not on individuals.

Lessons learned:

Given the fact that all the auditors have been thoroughly trained by SABPP, it is imperative for auditors to be professional and knowledgeable at all times. It is important to consistently remind auditees that they are been audited against the set standards and the outcomes of the audit results will be based on the standards and audit framework.  Hence, there is almost no room for subjectivity or personal opinions.  In certain instances, the auditee may have all the elements of the National HR Standards in place, but if such elements are not aligned with the strategy, they will struggle to provide sufficient evidence during the audit. In some cases, HR departments were only able to provide anecdotal evidence at best, or no evidence in worst case scenarios.

Advice to auditees:

The organisations who are preparing to be audited should first have their HR staff trained on the National HR Standards. They must align their HR systems and processes with the National HR Standards prior to the audit. In addition, it makes business sense to be audited by using uniform HR National Standards, in order to benchmark the auditee against competitors.  In addition, after more organisations have been audited, the audit trends shall be established. HR Auditing will go a long way in assuring boards, top management and HR professionals that their HR systems and processes are up to standard and is comparatively benchmarked with other organisations.

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Moleko Rannona MHRP is an Auditor for the SABPP Audit Unit

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