Auditors review the integrity of financial information in an organisation and the means used to gather and estimate such information. In layman's terms, they are accountants who ensure that other accountants and executives are honest. Most auditors have a degree in accounting or a related field, and many have a professional certification such as a CPA credential. Median earnings for auditors was about £38,629 in 2008, according to the Bureau of Labor Statistics. Half of all auditors made between £29,835 and £50,836
Internal vs. External
Both internal and external auditors are expected to act independently.The role of internal auditors has changed somewhat in recent years. While they have been traditionally tasked with lowering the cost of external audits, internal auditors now commonly work within a company to manage risk of theft or loss and to ensure that a company is running smoothly. External auditors are hired to perform an independent review of financial reports to see if they comply with generally accepted accounting standards. At the conclusion of an audit, external auditors issue an opinion that states, among other things, whether or not the financial statements accurately depict the financial condition of a company and also note, where applicable, any serious deficiencies in accounting policy. An audit that lists serious concerns or details a lack of access to certain information can have a devastating impact on a company's stock price and ability to obtain financing. These audits may include physical counts of inventory, reviews of real property and tests of transactions.
Auditors issue their report and opinion to the audit committee. The audit committee is comprised of members of a company's board of directors. Under the Sarbanes-Oxley Act, an audit committee has broad powers of independence. The audit committee is tasked with hiring auditors.
When a major fraud is uncovered at a company, many observers look to auditors to discover how the fraud was allowed to happen. Professional auditing standards usually do not find fault with audits that fail to uncover fraud. Several financial scandals, such as those at Enron and WorldCom, have placed renewed emphasis on addressing fraud concerns. Statement on Auditing Standards No. 99 addresses the role of the auditor in finding fraud and suggests a brainstorming session to find areas in which a company might be susceptible to financial statement fraud. The standard also requires that auditors gain an understanding of the business to explore the possibility of financial reporting weaknesses.
- 20 of the funniest online reviews ever
- 14 Biggest lies people tell in online dating sites
- Hilarious things Google thinks you're trying to search for