Internal auditors can effectively benchmark employee turnover rates by comparing their organization’s turnover to published data from peer organizations. This provides the most meaningful and relevant comparison.
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Question
During an audit of the human resources department, an internal auditor adopts benchmarking to test the employee turnover rate. How should the internal auditor apply this technique?
A. Compare turnover in the organization to published turnover rates of peer organizations.
B. Compare turnover in one period with turnover in the previous period in the organization.
C. Compare turnover in the period to total employees in the organization.
D. Compare turnover with the auditor’s general knowledge of the organization.
Answer
When auditing the human resources department and examining employee turnover rates, the most effective benchmarking approach for an internal auditor is to:
A. Compare turnover in the organization to published turnover rates of peer organizations.
Explanation
Benchmarking allows the auditor to assess how the organization’s turnover compares to similar companies. This provides the most meaningful and relevant point of comparison.
The other options are less ideal:
- Comparing to the previous period only looks at internal trends but doesn’t show how the company performs relative to peers.
- Comparing turnover to total employees provides a turnover percentage but no external context.
- Comparing to the auditor’s general knowledge is subjective and not based on actual data.
By using published data from peer organizations, the auditor can determine if the company’s turnover rate is higher or lower than the norm for its industry and identify if there are potential issues that require further investigation. This benchmarking approach provides an objective, data-driven assessment that will be most useful for evaluating HR practices and identifying areas for improvement if needed.
IIA-CIA-Part2 certification exam assessment practice question and answer (Q&A) dump including multiple choice questions (MCQ) and objective type questions, with detail explanation and reference available free, helpful to pass the IIA-CIA-Part2 exam and earn IIA-CIA-Part2 certification.