What Does An Internal Auditor Do?

Skills Required of an Internal Auditor

Successful internal auditors possess technical and soft skills that assist them in working effectively. Internal auditors' skill sets help them effectively analyze financial information and find areas for improvement.

Internal auditing skills include:

• precise attention to detail
• strong ethical standards
• accounting knowledge
• risk management expertise
• decision-making
• analytical and critical thinking
• understanding of information technology
• developing audit plans and reports

Benefits of Being an Internal Auditor

Being an internal audit professional comes with many benefits, making it a rewarding career path with diverse opportunities for professional advancement and personal growth. As a key player in ensuring organizational integrity and efficiency, internal auditors enjoy several advantages.

Internal auditor benefits include:

• job stability and competitive salaries
• career advancement opportunities
• gain industry credibility
• contribute to improving organizations
• maintaining ethical standards for companies

What Are the Responsibilities of an Internal Auditor?

An internal auditor's job covers a range of responsibilities that provide organizations with objective assurance by evaluating and improving their internal controls and assessing risk management. Internal audit activity maintains ethical standards by assessing governance processes for compliance and conducting thorough audits.

Ensure Companies Adhere To Industry Laws

Internal auditors review policies and procedures to identify areas of non-compliance with regulations and give recommendations for improvement to ensure organizations are adhering to relevant laws and standards.

Conduct Audits

Internal auditors are responsible for performing audits of financial statements and internal controls to ensure financial reports are accurate and company policies are being followed. They make audit plans and perform the internal audit process, evaluating the effectiveness of internal controls throughout the organization.

Identify and Document Risks

Internal auditors perform risk assessments, identifying potential risks within the organization and documenting them to help develop improvement strategies for minimizing them.

Data Analysis

Internal auditors analyze financial and operational data to identify instances of noncompliance, discrepancies, and areas for improvement. They follow the Institute of Internal Auditors (IIA) standards and utilize the International Professional Practices Framework (IPPF) to guide their analysis and reporting.

Oversee Company Workflows

Internal auditors oversee a company's workflow processes to assess efficiency and recommend improvements to increase productivity. They evaluate the effectiveness of internal controls and make audit plans to ensure that workflows are optimized and compliant with regulations.

How To Become an Internal Auditor

Becoming an internal auditor involves meeting certain requirements such as completing a degree, earning credentials, and gaining experience. Completing these steps prepares internal auditors to excel in their careers and advance to more senior positions.

Get a Relevant Bachelor's Degree

The first step is earning a bachelor's degree in accounting, finance, or a closely related field. A degree program gives students a foundational understanding of:

• financial reporting
• business practices
• auditing principles

Gain Experience Working in the Business Field

Gaining entry-level work experience in the business field helps aspiring internal auditors develop their understanding of how organizations operate and aspects of auditing like risk management and internal controls.

Earn Credentials

Credentials demonstrate your proven expertise and help your skills stand out in the job market. While it's not a necessary part of the job description, many internal auditors choose to enhance their skills with a certified internal auditor to certified public accountant (CPA) certification. Others include certified fraud examiner and certified information systems auditor (CISA).

Certified Internal Auditor

The certified internal auditor (CIA) certification demonstrates an internal auditor's expertise and recognition in their field. The certification, which ends with a three-part exam testing your core internal audit skills and knowledge, requires a bachelor's degree and two years of experience.

Certified Public Accountant

Becoming a certified public accountant involves taking an exam to demonstrate your knowledge of accounting principles. Employers often prioritize candidates with a CPA certification because it proves the applicant has auditing expertise and credibility.

Consider an Advanced Degree

After completing the previous steps, internal auditors can choose to further their education. Advanced degrees like a Master of Science in accounting or a Master of Business Administration (MBA) can provide internal auditors with specialized skills and more in-depth knowledge giving them the ability to access higher salaries and more opportunities in auditing, such as senior management and corporate governance roles.

FAQs About Internal Auditors

These common questions and answers can help you understand the process of becoming an internal auditor and what the job entails.

How Long Does It Take To Become an Internal Auditor?

Getting a degree, earning certifications, and gaining experience to become an internal auditor generally takes about four to six years, less if you choose an accelerated program. Pursuing internships or entry-level positions during your studies can provide practical experience and decrease the timeframe for becoming an internal auditor.

Is It Worth It To Become an Internal Auditor?

Yes, it is worth it to become an internal auditor, the field offers job stability and competitive salaries with plenty of room for advancement into higher positions. Internal auditors gain insights into various industries, enhancing their professional growth and expertise.

Can You Become an Internal Auditor Completely Online?

You can become an internal auditor completely online with online degrees and certification courses, but gaining on-the-job experience is typically done in person.

Many accredited universities offer comprehensive online programs that cover essential auditing principles and practices, providing flexibility for students. However, hands-on experience and networking opportunities gained through in-person roles are essential for career development in this field.

How Does an Internal Auditor Differ From an External Auditor?

Internal auditors work for an organization, auditing their internal controls. An external auditor works independently, examining an organization's financial documents for regulatory compliance to provide stakeholders with financial assessments.

While internal auditors focus on improving and ensuring the efficiency of internal processes, external auditors provide an objective evaluation of financial statements to ensure accuracy and compliance with accounting standards.