What is a 'Horizontal Audit'

A horizontal audit involves an audit of the same activity across an organization, to ensure different departments are adhering to the same standards.

BREAKING DOWN 'Horizontal Audit'

Horizontal audits are designed to detect any differences in how processes and activities — such as employee training, document control or expenses — are handled by different parts of an organization. They are used to ensure the whole organization is adhering to common standards, such as the International Organization for Standardization guidelines used for quality management systems.

Horizontal audits have one drawback, though. They make it difficult to see how processes are connected and how they can be improved – as would be the case in a vertical audit, which assesses all the activities and processes in a given department. However, horizontal audits are a useful tool to check whether corrective action has been effectively implemented. That is why many firms combine both approaches to audit a company or department's overall business.

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