What is an Auditor?

An auditor is an individual who examines the accuracy of recorded business transactions. Auditors are needed in order to verify that processes are functioning as planned, and that the financial statements produced by an organization fairly reflect its operational and financial results. They are primarily engaged in audits, which verify an entity’s financial records and their presentation in related financial reports.

Types of Auditors

The main types of auditors are internal auditors and internal auditors, as explained further below. We also make note of the role of forensic auditors.

Internal Auditors

An internal auditor works for the entity which he or she audits. This person conducts independent analyses of a variety of processes within a business, and may also evaluate the level of corporate governance. Internal auditors report their findings to the board of directors, along with remediation suggestions. An internal auditor’s work may be relied upon by external auditors as part of their audit planning. Internal auditors who work for large companies may be required to travel extensively.

External Auditors

An external auditor is independent of the clients which he or she audits. This auditor may be certified by a state agency to be a certified public accountant, who is allowed to issue certified reports on the financial condition of clients.

Government Auditors

An auditor may work for a government, and in that role is tasked with examining the records of individuals and businesses to see if they have complied with the various tax laws. For example, an auditor might investigate whether a business has properly withheld sales taxes from its invoices to customers and remitted them to the government.

Forensic Auditors

A forensic auditor investigates whether fraud had been committed. The resulting evidence is used to prosecute the party that committed the fraud. A forensic auditor may be employed within a business, or may work for an outside firm that conducts these investigations for its clients. Forensic auditors may have to testify about their findings in court. Forensic auditors may have to travel extensively and remain away from home for weeks during their investigations.