Project management audits are a way for companies to better

themselves and create stronger procedures for future projects. Not

only does this benefit the company, but often the employees as well
by creating more efficient systems.

There are few unavoidable aspects of running a business, and a

project management audit is one of them. While the notion of an
audit can cause anxiety when unprepared, the reality is that a well-
planned audit leaves little to worry about. Being organized and
proactive helps lower stress and create higher chances for positive
outcomes.

What Is A Project Management Audit?

The role of an audit in project management is to ensure that
company policies and procedures are being upheld. It also serves as
a way to enhance those procedures by evaluating the assigned
project being formally reviewed. Audits are usually performed by
an external audit provider to avoid preferential treatment and to
have the most effective and objective audit outcomes.

Audits are commonly used to provide valuable insight into the

effectiveness of a company’s project management. They can be
used in two ways. First, it can serve as a way to encourage growth
in a company through gaining individually curated
recommendations from an external source. Secondly, it can be used
to help a company make the switch from one project management
style to another, by highlighting the current barriers their projects
are facing.
The Role of An Audit in Project
Management
Project management audits can determine common struggles your
project may be facing, and help prompt solutions to those struggles.
If your company is experiencing recurring problems in your
projects, an audit may be helpful in discovering and mitigating
those problem areas so that you can optimize for the future.

Audits can provide important growth opportunities for a company.

It can determine future procedures and processes to define company
expectations, often with a goal to reduce costs, minimize project
risks, and ensure high standards are met.
What Are The Main Goals Of A Project
Management Audit?
The main goals of a project management audit can vary depending
on the agreed-upon parameters. However, when determining the
effectiveness of current project management procedures, there are
five main objectives that are often included. Consider these:

1. Identify Risks
An auditor will look for aspects that are negatively affecting
the project. This may include anything that impacts the project
timeline, budget, or quality. The auditor will measure the
potential costs and time of the project as well as the resources
necessary to ensure it has a high likelihood of success. This
will determine if it’s possible for the company to achieve the
project goals and find success based on the current strategies
in place. Identifying these risks helps the project manager take
steps to mitigate these concerns and achieve a more positive
outcome.
2. Assess The Quality Of Services And/Or Products
The auditor will take into consideration the different stages of
the project. This includes reviewing the design concepts and
the depth they go, considering alternative designs, and the
current proposed implementation processes. By including
these steps in an audit, it helps highlight any errors that the
project may face and proposes solutions for them. This will
provide a way to ensure that quality expectations are being
met.
3. Improve Project Performance
Audits identify the priorities of the project and determine if
they are being supported. Project performance is improved
through the attention spent on discovering and managing
errors before they arise mid-project. This provides two main
benefits: improving the proposed budget for the project and
developing plans to avoid potential areas of struggle noted in
the audit report.
4. Gauge The Quality Of The Project’s Management
An audit will help ensure the project is complying with the
company’s procedures and policies. This can provide
additional protection to the project teams by providing clear
outlines for management expectations. This can also provide
suggestions for improvement for management staff to better
support their teams and the projects they complete.
5. Learn For Future Project Management
Audits serve as a learning opportunity for the project manager,
allowing them to assess their current project and learn from
their past performances. This helps shape and update a
company’s policies and procedures to reflect their individual
needs and goals. The learning opportunities project
management audits provide are essential in the growth of a
company.
Six Benefits Of Project Management Audits
When you complete a project management audit, you’re going
through the process of discovering what you’re doing well, and
what you may need to improve. By finding this information, your
project can inherit a range of benefits beyond the project finding
success. These benefits include:

1. Improved Project Performance

When you are reviewing the project and breaking it down into
each component, you can effectively see where some
problems may exist. Once you have taken inventory of these
problems, you’re much better suited to manage them.
2. Cost Awareness
A project audit takes a deep look into the cost expectations of
a project and is able to determine if there’s a possibility of that
cost exceeding the budget. This reflects any problem areas,
resource necessities, staffing needs, etc. When the project is
 broken down, these estimated costs can be more effectively
assigned, allowing a more accurate estimate to be determined.
3. Reduced Cost
The process of determining your cost estimate naturally
provides a secondary benefit of reducing project cost all
around. Once the project has been broken down into its
essential elements, problem areas are discovered and can be
mitigated. Managing these can reduce the cost of completing
the project by eliminating redundancies or unnecessary
inclusions.
4. Increased Clarity For Project Team Members
A project audit helps team members become more aware of
each aspect of the project. They will be better able to
understand the complexities of the project and understand
their role within it more clearly. As an added benefit, this can
help develop a stronger responsibility to the project in each
team member as they can visualize the importance of their
role.
5. Better Relationship With Clients
Clients will be pleased to know their project will be completed
to the highest caliber, without money being wasted on
avoidable pitfalls. An audit can give them peace of mind and
allow them to feel more confident about their project.
6. Positive Effects On Future Projects
Each time you perform a project audit, it will help the
effectiveness of any future projects. Audits reveal aspects of
change that can be carried forward into each project that
follows. This helps all future projects to be completed with the
same, updated standards in place without having to undergo an
audit themselves.
How To Set Up A Project Audit
Successfully
Successfully setting up a project audit requires five steps to be
taken prior to the audit beginning. These steps will help ensure your
company is ready to engage in the audit process in the most
efficient and effective way.

1. Determine The Range Of The Audit

Before you can begin the audit process, it is essential that the
executive team determines if the audit is for one particular
project, or for a range of projects across the company. This
will depend on the outcomes you are hoping to achieve, and
the reason why an audit is being performed.
2. Bring In An External Auditor
Hiring an expert auditor that is not part of your company helps
ensure the quality of your audit. Because these auditors are not
associated with your company, their findings and
recommendations are not influenced by their involvement
 with the company. This also provides your employees with a
more open environment during their interview process, as they
are protected by the audit being done outside the company
itself. This allows for more honest feedback and maintains the
integrity of the audit.
3. Identify The Challenges
Before you begin the audit, identify the challenges you’re
experiencing with the project(s) or the processes involved.
Use this opportunity to reflect on what may not be working
and how you’ve witnessed that through project performance in
the past. This will help set the main goal for the project and
provide a starting point for the audit.
4. Determine The Scope And Parameters For The Audit
Think of this as a roadmap. This will help direct the range the
auditor can engage in, and determine the areas that are most
important. This will also help ensure that the auditor is
investigating the required aspects of a project, and not moving
into secondary projects or areas of the company that are not
included in the audit.
5. Notify Your Project Team
Let your team know about the upcoming audit. Many auditors
will speak directly to members of the project team. Your team
being prepared is an important aspect of the audit process.
This will help the audit go smoothly and allow them to get the
best information in an organized way.
An Internal Audit Checklist For Project
Management
A project manager who has a well-planned audit can create a better
learning opportunity for the team as a whole, and often performs
better than those that are less organized. While there are many
individual steps involved in an audit checklist, there are five main
categories they fall under. By completing an internal audit
checklist, you’ll be better able to support your team during the audit
process. This will also provide you with a streamlined process for
the auditor upon their arrival to make the process go quickly and
smoothly.

The five areas that make up your audit checklist include:

1. Your Main Audit Goals

Defining the main goals you have for your audit will help
facilitate the initial planning for the audit. Your goals should
 reflect both your project and the company’s values. Goals
could include reducing project costs, more efficient processes,
or resource management improvements. Take some time with
your team to discuss and clearly define the goals for this audit.
2. Well-Defined Parameters Of The Audit
This includes the expectations you have for the audit process.
It should include things like how the project will be measured
and why it’s being audited. This will also include the areas
that the auditor will focus on, such as team performance,
resource allocation, or management involvement.
3. Members To Be Involved
It is important to have a comprehensive list of the members
that will be taking part in this audit. This will give you an
opportunity to consider all those that play a vital role in the
project, and notify those individuals of the audit. This list
could include project managers, team members, sponsors and
stakeholders, and even clients. Those on this list could be
included for individual interviews throughout the time of the
audit.
4. Audit Process And Expectations
This portion of the checklist can be extensive based on the
project itself and the audit goals. It is a list of the methods to
be used during the audit. One essential and easily forgotten
aspect to include is the environment and atmosphere of the
project audit. When you include this in your checklist, you are
ensuring your employees are protected throughout the entire
audit process. This would extend to the communication
expectations as well. Outline how the auditor is to
communicate with the members from the previous section,
such as individual interviews.Also include the expectation to
prioritize problems based on their severity so that the report is
organized in a way that makes implementing
recommendations easier to navigate.In this section, it is
essential to state that strengths be included in the reports as
well as areas of improvement. Knowing what’s currently
 working and what isn’t is an important aspect of any good
audit.
5. Audit Reporting Expectations
Decide how the findings of the audit are to be reported and
communicated and include details regarding the audit process.
This section of the checklist could include:
 Who will be included in the findings
 Problems discovered during the audit
 Solution recommendations
 Performance evaluations
 Project performance rates
These are all aspects that you should be including in your audit
reporting expectations. This will help ensure you and your auditor
have the same understanding of the audit process.

What Is The Audit Process?

The audit process consists of five main portions. What is included
in each will vary based on the project, but the outline of the process
typically remains the same. Audits can take up to a few weeks to
complete, with the bulk of the time being spent gathering
information. There are, however, some valuable aspects that must
come first in this process.

The Audit Notification

This is a letter that is provided to the project manager to notify them
of the audit. Within this letter are the audit highlights. It includes an
introduction to the auditor(s) and lists the main objectives and
scope.

Requisition Of Documents
After the project manager has received the audit notification, they
will be provided with a list of documents the audit team is
requesting. The documents that are requested will vary depending
on the nature of the audit. For instance, this could include:

 Past project performance, both from the team as a whole, or

the manager individually

 Average project costs

 Project breakdown and estimated cost

 A copy of the company policies and procedures

 Quality reports

 Project plans

 The companies project management framework

Kick-off Meeting
This meeting serves as the beginning of the audit process. It will
provide time for the project team to meet with the auditor, and give
managers an opportunity to ask questions to become more clear on
audit parameters.

The Audit Process

This is the stage where the auditor begins gathering information
through a variety of means, such as:

 Individual interviews and assessments

 Employee questionnaires

 Observations

 Evaluating provided documents

 Collecting evidence to support claims and recommendations

 Creating the final report

While the details of this list can vary, this portion of the process
makes up most of the audit timeline.

Closing Meeting
The closing meeting is the time when all final information has been
gathered by the auditor and recommendations are ready to be made.
These recommendations would then be used to create an action plan
to implement them.
Four Different Types Of Audits In Project
Management
There are four main categories audits in project management fall
into. Which one you encounter will vary depending on the
company’s goal, and the reason an audit was prompted. The types
of audits include:

1. Inspection Audit
Inspection audits are performed after a product is built. It
involves monitoring the creation process and inspecting it
after it’s completed.
2. Quality Audit
These audits aim to determine how well a project manager is
following the company’s outlined processes. It deals primarily
with the execution of a project and the implementation of
company protocols.
3. Procurement Audit
This audit directly relates to the use of resources throughout
 the lifetime of a project. It reviews the different contracts and
contracting processes used to determine how efficiently
resources are being managed.
4. Risk Audit
The main goal of a risk audit is to increase the effectiveness of
a company’s processes. It helps determine how well a
company’s risk management processes function and helps
measure the success of risk responses in place.
Conclusion
Project management audits may be something that creates anxiety
and unease when people hear about them, however, they are an
essential part of growing a business. Audits can provide valuable
information regarding a project manager’s abilities and a project’s
potential outcomes. By utilizing audits, companies are provided the
opportunity to see how their current processes are directly affecting
the projects being done. This process provides them with clearly
defined problems within their current model, and recommendations
curated specifically to their needs. This is a proven way to foster
improvements to both your company and to your project managers
themselves.

See audits as an opportunity to improve your work habits, while

updating company policy and procedures to reflect the changing
corporate world.