- What is an administrative audit?
- Types of administrative audit
- Objectives of an administrative audit
- Methodology of an administrative audit
We explain what an administrative audit is, its principles and the types that exist. In addition, its different objectives and methodology.
What is an administrative audit?
An administrative audit is understood to be a complete review of the Organizational structure of a business or organization of any type, as well as its control mechanisms, operation and its human Resources and materials. It is a procedure that evaluates the organization as a whole, comparing its performance with its objectives, both global and per unit, to get an idea about the effectiveness of its management model.
The term “administrative audit” was used for the first time in 1935, when James O. McKinsey, belonging to the American Economic Association, proposed the rationale for a review of a company in all its aspects, “in light of its present and future environment. probable".
This concept would allow the subsequent emergence of ideas such as the self-audit proposed in 1955, and the development of this figure as an important mechanism in the field of competitiveness between organizations and in administrative theory.
An administrative audit obeys the following principles:
- Sense of evaluation. With this type of audits the potential or the suitability of the professionals or workers within the organization, as well as the managerial dynamics, that is, of the administrative commands responsible for coordinating the forces of the company internally.
- Importance of verification. An effective audit not only supports your conclusions on the information obtained, but offers scientific means to interpret it and to verify that it is a reliable evaluation.
- Think in administrative terms. The focus of the auditors must always be placed on the administrative aspect of the company, and not on other areas subject to administrative management. It is an evaluation of processes and resources regarding the mission of the company.
Types of administrative audit
There are two fundamental types of administrative audit:
- Functional. It focuses on the performance and suitability of managerial positions and the dynamics proposed from them.
- Analytics. It focuses on understanding the very processes that are put in place within the structure of the company.
Objectives of an administrative audit
Every administrative audit seeks to find the deficiencies or weaknesses of the various regions of a company, to correct or solve them. This means the following:
- Optimize the management of resources by the company.
- Evaluate the service (or product) provided by the company, in order to satisfy the client.
- Increase levels of quality and competitiveness through various mechanisms and plans for management.
- Identify administrative successes and replicate them in similar situations.
- Analyze the functions of each division of the company in relation to the others.
- Generate and propose new organizational schemes that solve problems at the macro or micro business levels.
Methodology of an administrative audit
Every administrative audit is made up of four elementary steps:
- Planning. The parameters and guidelines that will serve to focus the audit review are established, that is, you must first define what things to look for and what the specific search criteria will be. This happens for a reading of "symptoms" or of conflicts apparent.
- Instrumentation. Choose from various collection models data and measuring them, depending on the nature of the business and the type of conclusions to be reached.
- Exam. Planning is applied and data and statistics are collected or any other type of information that responds to the pre-established guidelines.
- Report. The closing of the audit results in a report in which the entire process is detailed and explained, the results are reported and, finally, the pertinent recommendations are made.