Audits as a project management governance tool

Here comes the dreaded project audit. How can we get out of this? We have all experienced this at one point, or will. So, why do we fear the project audit? We fear what we don’t understand. Let’s get to know more about audits, and try to alleviate that fear.

Auditing has its roots in the accounting world, used to evaluate financial records and ensure sound financial governance of the company. As a governance tool, auditing involves the review of documentation throughout the company’s financial systems. The purpose is to verify that all documentation follows company policies and procedures, as well as applicable laws. Any discrepancies provide insight into errors and flaws in the system (Groff et al., 2016).

Audits are a documented snapshot in time. They provide for an analysis of what has been done over the course of a specific period and are not forward-looking. They are historical in nature. Audits are in-depth investigations into large amounts of data (Juran & Godfrey, 1998). Therefore, audits are very time-consuming.

In project management, we see two different types of audits. Audits can be performed on the systems of the organization or on individual projects. The former is known as a project management audit. The latter is called a project audit.

The project management audit, similar to the accounting audit, is a review of documentation throughout the company’s projects. The purpose of a project management audit is a global review of the company’s policies and procedures to affirm they meet laws and industry best practices, to assure executive management that projects are properly managed, and ensure executive management is properly informed of the status of project work. The focus of these audits is on systems, processes and the structure of the organization. The organizational focus would include, for example, training and authority levels.

The project audit is a review of project documentation at a single point of time in the project. The purpose of the project audit is to verify the project is being managed in compliance with the company’s policies and procedures, ensuring consistency. The focus of a project audit is on the processes and how they are being used by the project team.

Audits, whether at the project management level or the project level, provide great value to the organization. But more importantly to the project manager, there are great benefits as well. This is what should encourage your enthusiastic participation in your next audit.

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