Human Resource Audit is a process of examining the Human Resource functions in the organization. The H R Audit is a quick way to assess the organization's human resource function. The audit is a diagnostic tool that helps the Human Resource department identify area that requires improvement. The purpose of the audit is to provide a complete and objective analysis of the human resource function of the organization. The human resource audit is a step-by-step procedure that takes into account the following aspects.

The H R Audit benefits the organization in the following ways

· It assess the quality of the HR practices
· Identifies area for change and improvement
· Assess the skills of the HR personnel
· Determines the efficiency of the department

Step 1. Identifying the role of HR in the organization.

The HR function can broadly be classified into the following 3 roles

· Strategic
· Legal
· Operational

Strategic role
The strategic role aims to support the business strategy of the organization. Here, the HR is more involved with policy making. To perform this task, it must the HR department must be fully aware of the strategy of the organization and the requirement of their clients.

Legal Role
The H R department ensures that the employment laws are not violated.

Operational Role
This role involves ensuring the smooth running of the personnel services. It is the most traditional role of H R. Here, it role is to see to the welfare of the employees.

Step 2. Assess the organization's HR strategy.
The HR strategy of an organization can be broadly categorized as follows:

Independent
If the HR strategy is independent, it does not follow the organization's
Business strategy. It develops its own strategy.

Integrated
The integrated HR strategy follows the directions laid down by the business strategy.

Step 3. Structure the HR department.

Based on the inputs received from step 1 and step 2, the HR department is restructured. The size, shape and structure of the HR department is mapped out. The structure of the HR department will have an impact on the attitude of the HR employees. The HR department is restructured after listening to and understanding the views and opinions of the employees in the department. While structuring the HR department, it is essential to identify the skills and competencies that will be required.

Step 4. This step involves measuring the performance of the HR department.

The performance of the HR department is assessed by finding out what the people of the organization perceive the department to be. The perceptions, opinions and attitudes of employees are analyses. Hard measures are also used to assess the performance. Hard measures are those measures that can be quantified easily. They are ratios, percentages or cost. The hard measures that are used to are the following

Ø Recruitment- this means the number of recruitments done
Ø Training- number of training workshops conducted
Ø Appraisals- Number of appraisal sessions held

Step 5. Benchmarking the HR activities
Benchmarking is an evaluation technique of one's performance in comparison to that of another organization. Through benchmarking, you can decide whether the organization's performance is at par with that of the other organization.