With January right around the corner, the end of the year can be incredibly busy for many businesses. From holiday preparations to finalizing important projects, everyone in your business will have a full schedule. For the HR and management teams, the end of the calendar year marks the beginning of audit season. Designed to keep your organization running smoothly and compliant with federal and state guidelines, a year-end audit ensures that your business is exactly where it needs to be.
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Types of Year-End Audits
There are several types of audits that can be performed at the end of the year. Each type focuses on a specific objective within the business.
- This type of audit focuses on finding out how well the organization is complying with federal, state, and local regulations and laws.
- Best practices
- These audits help the organization maintain or improve competitive practices by comparing the organization’s practices to those of companies identified as having excellent HR practices.
- During these audits the strengths and weaknesses of the organizational systems and processes are reviewed to determine if they align and correspond to effectively driving the overall strategic plan
- This audit focuses specifically on an HR function such as payroll, performance management effectiveness, records retention, and more.
Preparing for A Year-End Audit
The first step to completing a successful year-end audit is to determine what data needs to be collected. This is when you will define which audit you will perform. You will also determine if you will be conducting this audit internally or hire an external source for more objective/benchmark comparisons. You will define your objectives and create a clear plan of action to create the results you expect.
The next step is to analyze the data that you have collected and make sure that all records are correct and align with the processes. Finally, preparing a report with all of your findings to be shared with other members of the team will make it easier to create corrective actions, as well as maintain compliance as you move forward. This report may include the strengths and weaknesses of the organization, program success in driving important business goals, areas to enhance, and/or the correction of any compliance issues.
Benefits of Conducting an HR Year-End Audit
Conducting a year-end audit has several benefits for the organization.
- Audits provide a broader vision of the inner workings of the company and ensuring those key functions are aligned to driving the business.
- Furthers the growth of the company by showing areas that could use improvement.
- Performance and morale can increase with audits that provides focus on areas that are performing well and providing tools/training for other areas that need support.
- Compliance is encouraged when audits are done regularly.
Year-end audits are essential to keeping your business or organization running smoothly while staying in compliance with state, federal, and local regulations. At HR Collaboration Group, we are here to help you in all aspects of strategic alignment, human resource planning/management, and employee development – with as little as much help as you need, including assistance with year-end audits. To learn more about our full-service HR solutions, contact us today.