We are studying or working because we want to earn more money. Be it small amounts or large amounts, everyone is concerned about it and the same is with individuals or governments or corporations. Government spent money for the welfare of the people. Different ministries spend the money in various ways. Companies or corporations earn profit from their business and then they need to pay tax and other liabilities.
In the process it is important for us to know what is the amount being spent or how much we earn. In this case a common word that comes to our mind is Auditor.
An auditor has a big role in connection with finance. Auditing is a systematic process of objectively obtaining and evaluating the accounts or financial records of a government undertaking, department, private business, or other entity based on an established criteria.
In other words, Auditing involves the review, analysis and evaluation of processes, products, services, systems, organizations and employees. It is a specialized form of accounting for an organization’s financial information, which includes systems, policies and records.
A person who is involved in the process of auditing is simply called an auditor. Auditors determine the efficiency, adequacy of the organization whether a government or private organization.
They also review the reliability and integrity of management. Major types of audits conducted by auditors include financial audit, operational or management audit and compliance audit.
A financial statement audit examines financial statements, records, and related operations to ascertain adherence to generally accepted accounting principles.
Types of auditors
Internal auditors- Internal auditors are employed by individual corporations, government bodies or other entities. Internal auditors work for the organisation they audit. Their job is to make sure the organization runs efficiently and effectively. They perform financial, internal control, and compliance audits for the employer.
External auditors- External Auditors are also known as Independent Auditors or Professional accountants in public practice. An External Auditor audits financial statements for companies, and other organizations. They also give advice in preparing income tax returns and provide guidance in matters concerning compensation and healthcare benefits for employees.
Government auditors- Government auditors work in the public sector; they are employed by local and state governments. Government auditors maintain and examine the records of government agencies, and audit private businesses and individuals whose activities are subject to government regulations or taxation.
There are more scopes for auditors as the country is booming in many sectors. Financial matters can be dealt with by people who have knowledge on auditing.
Students can opt for a commerce stream after their senior secondary level. Being a student from a commerce background and having accounting as a subject is always helpful. One can go for courses like Chartered Accountancy to become a Chartered Accountant. There are advantages for students having mathematics as a subject as they get more opportunity in the field of auditing. There shall be more demands for auditors in coming years in different sectors like government, private, corporations, nongovernmental organizations, philanthropic organisations, charitable trusts, etc.
(Ranjan K Baruah is a career mentor cum skill trainer and can be reached at 8473943734 or [email protected] for any career related queries)