An auditor is someone who performs audits: the auditor checks that the accounting and financial statements of a business are complete, correct, and in compliance with rules and regulations.
An auditor can also advise a business about taxation, accounting, and rules and regulations so that they can ensure that they are compliant and accurate in their accounting.
An auditor is not the same as an accountant, who does the bookkeeping for you.
What happens during an audit?
When an auditor does an audit, their job is to verify that a business has done their accounting and prepared their financial statements in accordance with rules and regulations. This means combing through a business’ financial records to ensure that there are no errors—whether purposeful or accidental mistakes.
Different types of auditors
There are different types of auditors and they have different roles.
Internal auditor
Internal auditors work for the business they’re auditing. They go through financial statements to assess the business’ effectiveness, risk and financial health. In short, they serve as financial advisors, and contribute to a company’s improvement and risk management.
External auditor
There are also auditing companies, such as Deloitte or KPMG, who audit other companies. These auditors are called external auditors; they are not employed by the businesses they audit. External auditors have to be used for compulsory annual audits, which some companies have to undergo when they complete their financial statement.
External auditors can also be hired to get a completely unbiased opinion on your company and its financial status, or to ensure compliance ahead of completing the financial statement.
Government auditor
Some auditors are employed or contracted by the government. They check the accounts of companies that are subject to a government audit. In these cases, the auditor’s job is to check that the company has prepared its financial statement in accordance with rules and regulations.
These auditors can be called government auditors.