What is a Statutory & Social Audit?

🔍 Statutory Audit

The statutory audit is a regulated mission, carried out by a statutory auditor, in accordance with the French Commercial Code (articles L.823-1 et seq.). Its aim is to certify the company’s annual accounts by ensuring their accuracy and reliability.

The auditor is appointed for 6 fiscal years (or 3 under ALPE), with extensive rights to access information. Oversight is handled by the High Authority of Audit (H2A) since 2024.

👥 Social Audit

The social audit evaluates compliance with labor laws, social practices, and HR processes. While not mandatory, it is highly recommended to anticipate risks, improve work climate, and align HR strategy with business goals.

It may include a compliance audit (payroll, contracts, labor code), an HR audit, or a strategic audit, and relies on standards such as ISO 19011, IFACI, or IIA.

🧭 Two Complementary Approaches

Statutory Audit Social Audit
Mandatory if thresholds are met Optional but strategic
Conducted by a statutory auditor Performed internally or externally
Focuses on financial statements Focuses on HR and social aspects

Why is this audit essential?

🔒 Legal & Financial Security

▼

The statutory audit is a key financial safeguard for companies subject to legal account certification. In France, this obligation stems from article L.823-1 of the French Commercial Code.

It ensures the regularity, sincerity, and faithful representation of financial statements. Stakeholders such as banks and investors gain greater trust in the company's situation.

Even SMEs may be affected under group consolidation or fundraising. Since 2024, the High Authority of Audit strengthens transparency and supervision.

➕ Result: stronger governance, better valuation, and easier access to funding.

👥 HR & Social Compliance

▼

A social audit is a strategic tool to ensure compliance with labor law, collective agreements, and HR policies. It identifies gaps in payroll, contracts, working time, equality, etc.

Based on ISO 19011 and IFACI frameworks, it prevents URSSAF risks, disputes, and legal claims.

It helps manage workforce planning, legal changes, and employer branding. It demonstrates social responsibility to attract talent.

⚖️ A well-executed social audit merges compliance, HR performance, and responsible image.

⚠️ Extended Risk Management

▼

Audit goes beyond compliance: it acts as a shield against internal and external risks. It detects accounting anomalies, fraud, and control failures.

📉 Social audits reveal HR tensions, non-compliance, and legal risks like unpaid overtime or discrimination.

💥 Failing to meet obligations may lead to penalties, reputation damage, or lawsuits. Preventive audits anticipate deviations and guide actions.

🔎 A proper audit gives a 360° view of legal, financial, and HR risks.

🌟 Image & Trust

▼

Today, companies are judged not only on profits but on their ethics and compliance. Audits show rigor and commitment.

💬 Financial audits boost credibility; social audits show respect for workers and law (Labour Code, articles L.4121-1+).

📢 This enhances employer branding, helps in tenders, and proves social responsibility.

🤝 Auditing says: “We are transparent, rigorous, and responsible.”

⚙️ How does it work?

1. Initial scoping meeting 🧭

The audit begins with a preliminary meeting to define the scope: audited entities, reference period, applicable regulations. This step helps identify risks and sensitive areas to be reviewed.

2. Document collection 📂

The company provides the required documentation: financial statements, payroll, contracts, procedures, HR registers. Documents are reviewed based on their regulatory compliance and traceability.

3. On-site investigations 🔍

Auditors perform tests and controls on a sample basis: salary regularity, social charges, absence tracking, proper application of agreements. They check the consistency between payroll, accounting, and legal obligations (URSSAF, DSN…).

4. Interviews & observations 👥

Individual or group interviews may be conducted with employees, HR staff, or representatives. This helps to verify certain practices or assess the social climate. Confidentiality is always guaranteed.

5. Final report & recommendations 📘

A structured audit report is delivered: findings, compliance analysis, possible discrepancies. It includes concrete recommendations to secure your HR practices and anticipate legal developments.

📌 Our services in statutory & social audit

  • 🛡️ Internal control & fraud prevention:
    Analysis of accounting processes and implementation of control mechanisms to reduce the risk of errors or fraud.
  • 📊 Consolidation of accounts:
    Assistance in preparing consolidated financial statements in accordance with French GAAP or IFRS, to provide a unified group-level view.
  • 📅 Budgeting & multi-year planning:
    Development and monitoring of annual or multi-year budgets to anticipate funding needs and drive performance.
  • 🌿 Restructuring & business recovery:
    Economic diagnosis, strategic advice, and support in alert procedures, ad hoc mandates or conciliation processes.
  • 🤝 Mergers & acquisitions:
    Acquisition audit, business valuation, legal structuring, and full support during external growth operations.

🎯 Tips for a successful statutory & social audit

📋

1. Prepare complete files for each topic

Anticipate auditor questions (HR, working conditions, payroll, contracts) by gathering: contracts, pay slips, URSSAF records, time sheets. A well-structured, regularly updated file speeds up the audit and reassures auditors.

👥

2. Schedule scoping meetings early

Plan a meeting with your statutory auditor or HR consultant before the audit. Define the scope (periods, topics), identify applicable laws (Labor Code, collective agreements) and anticipate risks.

🔍

3. Perform internal pre-audits

Conduct an internal review: check pay slip compliance (hours, contributions), CHSCT/CSE registers, and HR procedures. Social audits often rely on frameworks like SA8000 or SMETA.

📅

4. Prepare staff for interviews

Social audits often include individual interviews with employees, reps, or managers. Brief them on their rights, the audit objectives, and the confidentiality of interviews to avoid tensions.

🛠️

5. Implement a responsive action plan

After the audit, use the report: identify non-compliance, assign a responsible party, set clear deadlines, and track progress. This improves HR practices and boosts external credibility.

📈

6. Leverage the audit in your HR strategy

The audit is a strategic tool to improve HR practices, support ESG efforts, and prepare sustainability reports such as DPEF or CSRD. Use it to professionalize your HR governance.