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Auditors help top leadership manage corporate affairs, providing guidance on various issues ranging from financial accuracy to internal controls to regulatory compliance. Auditors also help department heads identify tools and methodologies to improve operating activities, putting companies on a more financially sustainable path. Experienced corporate reviewers generally possess accounting knowledge and financial acumen.
Education and Pay
A four-year college degree is the minimum educational requirement for many auditor jobs, according to the U.S. Bureau of Labor Statistics Occupational Outlook Handbook, 2010-11 Edition. However, employers typically require a master's degree for senior roles. Typical college coursework includes accounting, financial auditing, investment analysis, tax planning, economics and regulatory compliance. Professional certification carries prestige, and most senior auditors or those working for large, multinational companies have one or more designations. These include certified public accountant, certified internal auditor, certified financial services auditor and certified quality auditor. Compensation levels for auditors depend on the state of the economy, the company they work for and their professional credentials. As of 2010, an auditor had an average earning power of $70,000, according to online job resource Indeed.
In the corporate setting, top management generally keeps a close eye on department heads. Senior executives establish policies and procedures, calling on auditors to provide guidance on the effectiveness and adequacy of internal controls. Internal controls help a firm prevent losses that may result from fraud, theft and operating errors. Effective controls remedy internal problems properly. Adequate policies clearly indicate to employees how to make decisions and report problems.
The review of a company's financial mechanisms and accounting processes is usually the job of external auditors. These reviewers sift through financial reports across the corporate landscape, focusing on performance metrics in significant business units or segments. Financial auditors pore over corporate accounting data summaries to ensure completeness and compliance with generally accepted accounting principles. Other important financial reporting standards include Internal Revenue Service rules and international financial reporting standards. A complete set of financial summaries includes a statement of stockholders' equity, a statement of cash flows, a statement of financial position and a profit and loss report.
Auditors help companies save money by identifying illegal activities and other instances of regulatory nonconformity. Performing systematic, in-depth reviews of corporate controls helps auditors ensure that a company does not come under regulatory scrutiny. Adverse regulatory initiatives include fines and non-monetary penalties, such as temporary suspensions. For publicly listed companies, the most important regulators include the U.S. Securities and Exchange Commission, industry groups and professional organizations.