Internal Controls

NHHR

Our Company is currenlty working on internal controls and I am in charge of the HR area. Does anyone have experience with this process? Any assistance would be GREATLY appreciated!

Many Thanks!

[email]hr@communitybanknh.com[/email]

Don D

Could you elaborate on your understanding of your company's objectives and your marching orders?

NHHR

I have been asked to document all HR procedures and determine control points and risk(s) associated with the HR area (hiring, payroll, benefits, termination, salary, orientation, etc.)

In essence, I need to pin point all areas of risk in the HR area and implement controls to mitigate the risk.

It is a LARGE project and was trying to seek advice from someone who has been through this process.

marc

This is a huge job.

To really do it correctly, in my opinion, each phase of your process needs to be flow charted, step by step and a very fine detail level. Then examine each step and ask yourself what could go wrong with that step to cause an inaccurate transaction to be processed or would cause risk of future issues for the company.

Then think what would you do to better insure the transaction is accurate. For instance, how do you know that a new employee should be paid at $10 per hour? At our shop, a form is signed, with job description attached, by the Exec Dir and the hiring manager. The EE initials the form and the job description.

This accomplishes several layers of control.

How do you know the EEs understand all of your benefit spiel? Do you have them sign a summary of your discussion? Do you have them acknowledge by signature that they are declining optional benefits?

Many of the controls in question are accounting oriented and should have input from your controllers office - other control features come from counsel suggestions, such as the need to sign for the handbook.

This is not something that can be developed in a few minutes, it takes lots of hours to properly document the systems that are in place or should be in place and to design primary, secondary and tertiary control points.

Good luck with this - it's a big job.

HRCalico

Not sure if this will help, but this is how I've handled for what I've had to do. Note that it is not a "finish in a couple of days" process, it has to sit for a while.

Start with one process, and go through it in your mind, writing out each step. Next time you do it (whatever IT is - insurance enrollment, for example), pull out your list and see if you missed anything. Also, if you have a funny "situation" come up, go back to your notes and add document it there.

Maybe even just start by making a list of the activities you need to document. (Don't forget to revisit in several days to see if you need to add) If you think of something to add, WRITE IT DOWN immediately! You most likely won't remember when you go to write out the details.

As for the controls and risks, you're over my head there. Not even sure what that means. Every hire, for example, is a "risk". Guess you mitigate risk by your interview process, reference checks, etc.

Good luck.

Patty Mac

I am in the very process now. We hired an outside consultant to do the task. I have spent about a week with him describing in detail all aspects of our HR department and we are still going strong. It is a tedious job and I just did not have the time to accomplish on my own. Good luck.