A human resources audit evaluates the HR activities in an organization with a view to their effectiveness and efficiency. It is done with a view to improve those activities, uncover shortcomings and address the deficiencies. The value of the audit is that it provides feedback both to the HR managers and the organization as to how well the HR department is meeting its duties and responsibilities. In short, the audit is a quality control check on the HR activities in a division or company and as to how well the activities support the organization’s overall strategy.

Typically speaking, the scope of the HR audit extends beyond the activities of the HR department. The success of the workings of the HR department depend both on how well it performs and how well its programs are carried out by others in the organization. The reality is that people problems are seldom confined to the HR department only. The reason employees are disgruntled can exist due to some management lapse, oversight or perceived favoritism. Often HR is the last to know of such a problem, as it is brought to the attention of the HR department in the form of an employee grievance, legal action or on the reasons for resignation in an Exit Interview. This being the case, HR is faced with the responsibility of playing a more pro-active role in finding the causes of employee dissatisfaction and mismanagement

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