Auditors are responsible for reviewing company accounts and ensuring that they provide the public, and in particular stakeholders, with a fair representation of the company’s financial position.
Auditors work internally within a company, or externally, reviewing the accounts of clients and making recommendations for improvement. Internal auditors examine the financial policies and practices within a company, advising management staff on how company finances could work more efficiently. External auditors independently review a company’s accounts, analysing and interpreting figures and assessing risk. Most companies are required to publish a copy of their audited accounts at the end of the financial year.
Inexperienced or part qualified auditors typically earn between £18,000 and £25,000 a year with annual earnings rising to £30,000 – 45,000 once qualified. Senior auditors earn £50,000 – 70,000 and director and partner salaries within large accountancy firms can be as much as £100,000 or above.
Financial auditors are responsible for:
- Reading information about a company in preparation for an audit
- Examining company accounts and financial records
- Collecting and interpreting figures
- Asking questions and discussing finances with clients
- Analysing financial reporting systems
- Recommending ways to improve the efficiency of a company’s financial reporting systems
- Examining policies and procedures associated with company finances
External auditors are required to be a chartered accountant with one of the following professional bodies:
- Association of Chartered Certified Accountants (ACCA)
- Institute of Chartered Accountants in England and Wales (ICAEW)
- Institute of Chartered Accountants of Scotland (ICAS)
- Institute of Chartered Accountants in Ireland (ICAI)
- Association of International Accountants (AIA)
Auditors may also train with the Chartered Institute of Public Finance and Accountancy (CIPFA) although this only allows auditors to work for public sector organisations, not private companies.
It is possible to start training with a professional body with a minimum of three GCSEs (Grades A-C) including maths and English and two A Levels, although the majority of auditors train as graduates, allowing them to qualify more quickly than school leavers. Qualifying as a chartered accountant requires auditors to be both time qualified (have significant experience of doing the job) and exam qualified. Many accountancy firms offer graduate training schemes which allow trainees to learn on the job and release them to study through a financial college at specified times.
Internal auditors are not required to be chartered accountants although it will always be an advantage when applying for jobs. Instead of training for an accountancy qualification many internal auditors choose to take the Internal Auditors (IIA) Certificate in Internal Audit and Business Risk.
Working as an auditor requires a logical mind and a range of specialist skills including:
- The ability to interpret and analyse financial figures and information
- Excellent mathematical abilities
- Excellent communication skills both written and verbal (communicating effectively with clients is a major part of the job)
- Time management skills and the ability to work well to tight deadlines and under pressure
- A high level of accuracy and good attention to detail
- The ability to manage own tasks and to work effectively as part of a wider team
- Good business acumen
- A knowledge of (often complex) financial systems
- A willingness to treat sensitive data with discretion
- Good problem solving abilities
- Ability to coordinate and delegate work to other members of the team
- Ability to write reports
- The ability to juggle several tasks at once
- Good managerial skills
Auditors are largely office-based but are often required to spend a significant amount of time travelling around, which may include staying away from home for nights at a time (this applies to external auditors who work for a variety of clients rather than internal auditors who work within a financial team in a single organisation) Auditors usually work Monday-Friday, 9 – 5.30 pm although overtime is not uncommon particularly when deadlines are approaching. The job of an auditor comes with a high level of responsibility and can be very stressful. It can also be mentally taxing involving long periods concentrating on detailed financial figures. Part-time work may be available.
Being accepted onto an accountancy training scheme can be very competitive so it is advisable to undertake some work experience with an accountancy firm, or within a financial department of a company. Experience in a role which requires logical thinking, problem solving or mathematical abilities will always be of benefit and will demonstrate a commitment to the profession. Internal auditors applying for a job in a non-finance related industry may also be required to have experience of that particular industry.
Auditors are needed in all sectors of the business world as the law states that all companies must have their accounts audited. Job opportunities for external auditors are most commonly found in large corporate accountancy firms but there are also plenty of jobs within smaller firms. All businesses and organisations above a certain size have a financial department and employ internal auditors to be part of that. This could include local authorities, private sector businesses, manufacturing companies and the National Health Service.
Qualified chartered accountants are permitted to audit external companies but are not classified as authorised external auditors until they have been a chartered accountant for two years, and have an audit qualification and a practising certificate from a professional body. The way to achieve the practising certificate depends on the professional body. ACCA require accountants to take the Audit and Assurance exam during their training and then to pass an Audit Orientation Course. The other professional bodies simply require that a third of experience gained since qualifying has come from an auditing role.
Internal auditors can continue to develop by taking further qualifications from the Institute of Internal Auditors. For example, they may choose to take a diploma in Internal Audit Practice or an Advanced Diploma in Internal Auditing and Management.
Also known as…
- External auditor
- Internal auditor
What’s it really like?
Geoff Park is a financial auditor for Pricewaterhouse Coopers (Pwc) in Leeds. PwC is a large international accountancy firm with offices all over the world. Geoff gives us the inside story …
I have been working as a financial auditor for three years, since graduating from an accounting and finance degree at the University of Leeds. During my final year at university I was accepted on to a graduate scheme with PwC although I deferred for a year so I could spend some time in Argentina before beginning work. I am now in the final year of the graduate scheme and am exam qualified (the hard bit!) but it will take me a few more months to have done enough qualifying hours ‘on the job’ to become a chartered accountant.
Now I am in my third year at PwC I have more responsibility than I did when I first started so a typical day involves managing other members of staff as well as working directly on the audit. My daily tasks usually include coordinating and delegating work to the team, communicating work in progress with the team manager and undertaking some of the more complex areas of the onsite auditing. The job is often a balancing act and typically involves writing reports on an audit for a previous client and preparing for the job with the next client as well as reviewing the work of the current client. This means it is important to be good at balancing several tasks at once!
I enjoy the variety of the job – a day is never the same as the one before it. You get to see a range of businesses and get a broad understanding of the way businesses operate. I also enjoy working with other people although I do sometimes work from home – most of the people in the office are around the same age as me which creates a good sociable atmosphere. On the downside the work often requires long hours and some extended periods of travel which can be very tiring. I’ll qualify in a few months so I will then consider whether to stay working within my current role at PwC or to look for other opportunities elsewhere.
To anyone considering working as an auditor it is important that you are willing to work hard to ensure you pass your exams whilst balancing this with your client commitments. Being a good team player is crucial but you must also be able to manage your own responsibilities effectively. It is also important to be a quick thinker and have excellent communication skills as contact with clients is a key part of the job.