Auditing has been around since Accounting has – there are pieces of evidence of its existence in ancient civilizations such as Egypt and Greece. It traces back to the 18th century when large scale production became a thing due to the Industrial Revolution. Before now, the purpose of auditing was to obtain information about the financial system and records of a business.
Now, however, auditing has begun to include areas of a business that are non-financial such as safety, security, information system performance, and environmental concerns. This is the case for non-profit organizations and government agencies because their success in satisfying mission objectives must be examined.
Who is an Auditor?
An Auditor is what you get when you cross an accountant and a detective. Auditors usually work with a lot of investigation. They are specialists who review the accounts of companies and organizations to ensure the validity and legality of the company’s financial records.
An Auditor is a finance expert who analyses financial records of companies to ensure that the records are accurate and transparent. The process of carrying out these duties is known as auditing.
Types of Auditors
There are two basic categories of auditors. These are internal and external auditors. However, Forensic auditing is also a specialization on its own.
Internal Auditors: These are experts who audit the accounts or financial engagements of companies they work in. They are guided by the Institute of Internal Auditors (IIA) and are required to be objective and fair. Internal auditors mostly report to the highest body of authority in an organization.
External Auditors: These are auditors who work in auditing firms. They are periodically called upon to evaluate the financial records of other organizations. They equally help to justify or discredit the financial policies of organizations. On many occasions, they provide professional financial advice.
Forensic Auditors: They specialize in investigating suspicious financial activities in an organization. They also carry out investigations on cases such as embezzlement, banking crimes, tax evasion, money laundering, among others. Forensic auditors mostly work with lawyers and law enforcement agencies.
Responsibilities of an Auditor
Auditors work in the accounting department of companies where they examine the money that goes in and out of the organization and make it is recorded and processed properly. The typical responsibilities of an Auditor include:
- Auditors do the work of collating, crosschecking, and analyzing the data on a spreadsheet.
- As an Auditor, one thing you will be expected to do is examine company accounts and the financial control systems.
- Organizations are always facing financial risks; it is the job of the Auditor to gauge these risks and determine their levels.
- As an Auditor, you will check that financial reports and records are accurate.
- Auditors also Ensure that assets are protected at every point in time.
- Auditors advise changes that the organization needs. Therefore, they identify the points where regular processes are not working and implement these changes.
- As an Auditor, you will prepare reports, financial statements, and commentaries for stakeholders in the company.
- You will also work with higherups in the organization and present your findings and recommendations to them.
- It is the responsibility of an Auditor to make sure that policies, procedures, regulations, and legislations are complied with and followed.
- As an Auditor, you will oversee reviewing wages.
Skills of an Auditor
Communication skills: This is a very important skill to have as an Auditor because you cannot be effective if you lack effective communication skills. As an Auditor, you must be assertive and social skills at the same time. You might be very good at compiling reports, but if you cannot effectively communicate when you need to present your work, all your effort might be in vain.
Decision-making skills: As an Auditor, you must be able to make independent and unwavering decisions. Your decisions must be void of any personal interests and made after careful analysis of the company’s operations.
Attention to Details: As an Auditor, your job is to investigate and make sure things are how they should be. This requires you to pay great attention to detail. You must look at the tiniest details so that you do not any important information that might cost the organization.
Other important skills are:
- Strong analytic math skills
- Good knowledge and interest in the financial
- Ability to work under pressure
- Teamwork skills
- Strong IT skills
Education and Training for Auditors
Auditors usually have educational backgrounds in Accounting, Insurance, and Bookkeeping. But to become a qualified auditor, you will have to take some professional exams. You also need to be a chartered accountant. Then, you can obtain a Master’s degree qualification in a relevant field if you need additional qualifications.
However, you should know that a few universities already have courses that focus more on Auditing. Others also have Auditing as one of their specializations. So, if a career in auditing is ideal for you, you should begin to consider enrolling in these schools below.
- Brunel University in the United Kingdom offers an Accounting BSc degree. The program is structured to give you a comprehensive grounding in the conceptual, professional, and practical aspects of accountancy at all levels, and develop your ability to identify and solve complex accounting problems across a range of business scenarios. You also obtain a firm understanding of the financial drivers underpinning business leadership, strategy, planning, governance, and ethics. The mode of study is 3 years full-time or 4 years full-time with placement. The tuition for international students is £15,860.
- Dublin Business School in Ireland offers a Bachelor of Business and Accounting degree. The program provides foundation education in the quantitative, computational, and analytical skills required in the world of business and accounting. The degree covers many accounting and business principles including financial and cost accounting, management accounting, auditing, and taxation. The duration of the program is 3 years full-time. The tuition for international students is €9,850.
- The University of New Brunswick offers a Bachelor of Applied Management in Accounting degree. Completion of a two-year diploma from a recognized college, with a focus on accounting and a minimum overall average of 70% is required to get into this program. The tuition for international students is $8,442.
Job Outlook and Salary for Auditors
According to the U.S. Department of Labor Statistics (BLS), employment of accountants and auditors is expected to increase by 6% over the 2018-2028 decade (www.bls.gov). This is because as businesses increase, the subsequent need for more management advice will also increase.
- According to Neuvoo, the average salary for Auditors in the United Kingdom is £39,986 per year.
- Indeed estimates the average salary for Auditors as $68,729 per year in the United States of America.
- Neuvoo estimates the average salary for Auditors in Canada as $58,818 per year.
- According to Salaryexplorer, an Auditor typically earns around 308,000 NGN per month in Nigeria.
Typical Employers of Auditors
Auditors occupy top positions in Insurance Companies, Banks, Government Agencies, and other financial institutions. Internal Auditors usually work for professional companies that are outsourced by client firms and large private organizations or charities. They could also work as part of a company’s accounting team.
External Auditors, on the other hand, work in the public sector and carry out audits of the public sector and governmental bodies.
Postgraduate options for an Auditor
Master in Accounting, Auditing, and Management Control from Universitat de Lleida (University of Lleida) in Spain. The program is a professionalization master’s specializing in Accounting, auditing, and management control. It offers dynamic and up to date knowledge in the controller and audit specialties. It will help you develop your skills and knowledge in accounting, auditing, and management control as fundamental elements of information on companies and entities in general. the program is offered in English. The duration f the program is 1 year full-time and the tuition for international students is EUR 2,700.
Specialized Master in Auditing and Consulting from ESCP Business School in France. This degree is a one-year full-time academic program designed for individuals that already hold a first masters-level academic or professional degree in engineering, business, architecture, medicine, law, pharmacology, political science, the arts, or any other graduate degree. The courses are taught in English. The tuition for international students is EUR 19,200.
Differences between an Accountant and an Auditor
The responsibilities of accountants and auditors are sometimes similar. However, they are quite distinct in many aspects. Some of these are:
- Organizations hire auditors to determine the effectiveness of their accountants.
- While accountants mostly work as employees in their companies, auditors work periodically or on a contract basis.
- Accountants may have to work every day but auditors work at certain periods, depending on the rate of auditing that a company needs.
- Auditors occupy more significant positions.
- Auditors work with auditing standards while accounting practices are controlled by International Accounting Standards.
- Every business needs an accountant but not all would need an auditor.
- When accountants come up with a company’s end of year financial strength, an auditor is required to check if the assertions are genuine, accurate, and ideal.
- Auditors can audit the accounts of different companies at the same time.
Professional Certifications for Auditors
Certified Internal Auditor (CIA): This certification is ideal for individuals just beginning their auditing career journey. Obtaining this designation allows you to make a statement about your knowledge and aptitude. You can earn this certification by completing the Internal Audit Practitioner application and taking and passing the Certified Internal Auditor® (CIA®) Part One exam. You can also go forward to take Part Two and Part Three Exams for the full CIA certifications. The application fee is $230 and the Exams cost $395 for Part One and $345 for Part Two and Part Three.
Certified Information Systems Auditor (CISA): This certification is world-renowned as the standard of achievement for those who audit, control, monitor, and assess an organization’s information technology and business systems. It is ideal for those who are entry-level to mid-career professionals. CISA demonstrates your expertise and emphasizes your ability to apply a risk-based approach to planning, executing, and reporting on audit engagements. It helps you gain instant credibility in your interactions with internal stakeholders, regulators, external auditors, and customers. To earn this certification, you must take and pass the examination and apply to be certified within 5 years of passing the exam. The total CISA exam costs around $689. This is for members only. The cost for non-members is $760.
Certified Government Auditing Professional (CGAP): This certification demonstrates the skills necessary for auditors working in the public sector at all levels. It is a specialty certification designed for and by public-sector internal auditing practitioners. The CGAP exam includes 115 multiple-choice questions, covers four domains, and requires a completion time of two hours and fifty-five minutes. The price of the exam is $380 for members and $495 for non-members.
Careers that are Related to Auditing
Actuary: Actuaries are experts who identify the financial implications of risks taken by organizations. In other words, they help to determine what companies stand to lose when taking business risks. They make use of relevant theories, statistics, and mathematical calculations to find solutions to risks involved in business ventures. Actuaries take up managerial responsibilities as they are required to suggest business strategies to top-level employees in different organizations. They protect the interests of organizations by speaking against public policies that may not be favorable to their activities.
Accounting: Accountants give advice, audit accounts, and provide trustworthy information about financial records. It might involve financial reporting, taxation, auditing, forensic accounting, corporate finance, business recovery, and insolvency, or accounting systems and processes. Accountants can work in a range of organizations, including private organizations and industry and commerce, as well as in the not-for-profit and public sectors.
Market Research Analysis: A market research analyst is a business expert who consults different sets of individuals or products, collecting, processing, and translating business-related information for their employers or clients. An analyst writes reports of their findings in a spreadsheet. Some of these can be business opportunities for business owners, details about the nature of a market or users, the areas where a product or service will thrive, consumers’ actual needs, and some other factors that can influence sales.
Before you leave, send an email immediately, if you are thinking of enrolling in any of the institutions I shared above. I’ll be glad to help.