There are two general types of auditors: internal auditors and external auditors. Internal auditors, also known as accountants, have a different role from external auditors, who are hired by the company as part of a strategy to increase their knowledge and efficiency, often working as an internal consultant, or as a partner. Both internal and external auditors perform the same tasks; however, the manner in which they perform these duties may differ. Internal auditors typically report directly to the business owner and manager, whereas external auditors are hired by the company or by someone who works as an independent third party.
The job of internal auditors is to verify the accuracy of financial records and accounting data. They review financial statements for consistency with the company’s internal controls and procedures. Internal auditors review financial statements on a quarterly, monthly, quarterly-annual, or semi-annual basis and make sure that all financial information, including balance sheets, income statements, and tax return information are correct. In addition, internal auditors make sure that all financial statements are presented fairly and in a reasonable manner. Internal auditors are required to make sure that the financial records are properly reviewed and that the financial records reflect the corporation’s true financial status.
External auditors examine the organization’s internal controls and procedures. While internal auditors to make sure that financial records are accurate and that accounting information is presented fairly, external auditors make sure that the information is presented fairly and in a reasonable manner. External auditors make sure that the company maintains accurate financial records. External auditors also make sure that the financial records accurately reflect the organization’s true financial condition.
The audit process begins with the selection of an auditor. There are many different companies, such as A.M. Best, Ernst & Young, KPMG, PricewaterhouseCoopers, and Deltek, to name just a few, that have accounting firms that specialize in audits. Accountants in this category include executives from the business’s human resources department, accounting department, finance department, and any other departments that deal with financial matters. The auditor’s role is to make sure that financial records are created in accordance with the company’s internal controls.
During the auditing process, the auditor will review accounting records and financial documents, as well as information about the business itself, to determine if the financial documents reflect the organization’s true financial condition. Once the auditor verifies that the books and records accurately reflect the organization’s true financial condition, he or she then gives a report to the management detailing the results of the audit, including recommendations for future changes or improvements to the books and records or financial statements.
The auditor is also involved in the selection of auditors that he or she will be working with, based on his or her experience in the company’s finances department. The auditor selects an accountant based on the type of job he or she will be performing, whether that involves consulting or leading the audit department, and their ability to meet the company’s accounting needs and objectives. An accountant’s experience should be relevant to the work being done on a certain job.
An auditing company is not the same as a business’s financial accountant or bookkeeper. A professional auditor works as an independent auditor who is responsible for providing a report to the senior management of the company and helping to provide guidance on ways to improve and support the organization’s accounting practices. An auditor must have the knowledge and skills necessary to understand the organization’s financial records. Auditors are subject to periodic reviews in order to ensure the accuracy of the books and records.