Business Comunications Written Report
Auditing is one of the disciplines in financial management used to assess the financial standing of a business entity. Initially, auditing was only used by the government for accounting purposes and record keeping. However, the scenario changed during the period of the industrial revolution between 1750 and 1850. It became widely used to detect fraudulent practices within businesses and to ensure that businesses were able to Account for their finances. This made it possible for business owners to monitor their businesses even in their absence. By the start of the early 20th century, auditing practices had greatly improved due to the establishment of the “Independent Auditor’s report.” The Independent auditor’s report gives the roles and findings of auditor’s in a standardized manner. This report seeks to talk about auditing as a career and the duties, skills, education and other details that entail being an auditor.
Auditing is one of the disciplines in financial management used to assess the financial standing of a business entity. Initially, auditing was only used by the government for accounting purposes and record keeping. However, the scenario changed during the period of the industrial revolution between 1750 and 1850. It became widely used to detect fraudulent practices within businesses and to ensure that businesses were able to Account for their finances. This made it possible for business owners to monitor their businesses even in their absence. By the start of the early 20th century, auditing practices had greatly improved due to the establishment of the “Independent Auditor’s report.” The Independent auditor’s report gives the roles and findings of auditor’s in a standardized manner.
I would wish to pursue a career in Auditing after I obtain my degree. Auditing is important in ensuring that a company’s records are correct. Auditing ensures that a company upholds a high level of transparency and accountability especially where its Accounting systems are involved. The establishment of a standardized accounting system has made it possible to determine the existence of fraudulent practices in a business. The practice of auditing has seen businesses grow and become more stable.
An auditor is charged with various responsibilities as follows: To begin with, an auditor has a duty to submit a report to the members of a company. This report should contain his findings during the audit conducted. He should stipulate in his report whether the company’s financial statements show a true and fair view and possibly make recommendations if there are any. The auditor has a duty to ascertain whether the company’s statutory report is correct in regard to the allotment of shares, cash receipts and cash payments.
The auditor is further charged with the duty of reasonable care. He/she is expected to act with such skill, caution and care that is considered to be reasonable for the conduct of his audit. According to (Plessis, Balgaric & Hargovan, 231) an auditor has a responsibility to analyze all the relevant data in a company’s records so as to be able to detect any cases of fraud or malicious practices. A close examination of information and financial systems is another duty bestowed on the auditor as well as making recommendations to ensure data integrity and the reliability of the information and financial systems.
The minimum educational qualification for an individual to become an auditor is to have an undergraduate degree in Accounting. A master degree in Accounting can give an individual an added advantage. In a case where one is keen on becoming an external auditor, having a Certified Public Accountant (CPA) certificate is of great importance (Puttick & Esch, 44).
To become an auditor it is important for an individual to possess analytical skills. Analytical skills come in handy when examining financial records in order for the auditor to make conclusions with a great degree of accuracy. An auditor should be able to communicate effectively both orally and in writing as communication is key to the success of his work. Problem solving skills and critical thinking will be important for the auditor especially in order to make the right recommendations for a business entity (Kush, 15). An auditor needs to have a great skill in handling technology as computers will be widely used to perform various tasks. Finally, an auditor should possess some knowledge and skill in risk management. This will enable the auditor manage situations that are likely to cause an organization huge losses.
Personality traits required
Auditors need to have high ethical standards. This will enable them to perform their duties with the code of conduct and principles of their job in mind. They will therefore be able to perform their duties effectively while adhering to the principles of their job. Maintaining a goal focus is an important personality trait for auditors. This enables them to focus on their objective while performing their audit. Goal objectivity will enable an auditor come up with an objective report, which is helpful to an organization. Self-confidence is a personality trait that is important in any given job. An employee will have a firm belief in their abilities (Clark, 71). Self-confidence gives auditors the stamina to conduct comprehensive audits that can indeed give an organization the right view concerning its state of affairs.
Having the right attitude and being enthusiastic about one’s job is an essential personality trait for an auditor. Enthusiasm will make an auditor eager and passionate about their job and this are necessary traits for a successful auditor. Persistence is another personality trait required for this job description. It enables an individual to exude determination even in the face of difficulty. An auditor needs to be persistent in order to achieve his goals. Commitment is required for an auditor to be able to carry out his work within the specified duration of time. Most importantly is that an auditor should be trustworthy. An order should be seen to be honest as this will enable the various stakeholders of an organization rely on the findings stipulated in his report.
Most Auditors tend to work in an office setting. However, Auditors who work in a manufacturing concern may not be confined to their offices. A factory setting requires an auditor to carry out audit of stock and other raw materials. This will mean that apart from the records, the auditor has to physically ascertain that the available stock match with what is stated in the records.
Working Schedule/ Hours/ Vacation
Auditors are required to work for eight hours for five days a week. This translates to working for 40 hours every week. They are required to be at work from 8 a.m. to 5 p.m. every day from Monday to Friday. They are allowed to break for lunch from 1p.m to 2 p.m. Auditors do not come to work during the weekends and public holidays. They are also given two annual leave. This schedule is mostly relevant for internal auditors as external auditors do not have fixed working hours. However, sometimes auditors may be required to work for long hours especially when they have strict deadlines which they have to meet.
Work Location and Travel
The location of an audit firm can be for instance in London. KPMG, which is an audit firm, is located in various locations in the UK one of them being London. The auditors travel whenever they are conducting audits for other branches of the firm or when they are conducting audits for clients located in faraway places.
Job Outlook Short term and Long term
The Long Term Job outlook for auditors is that there will be a strong growth in the available employment opportunities for instance, over a period of ten years. In the short term, it is expected that those employees working on a part time basis will be able to take up full time employment and there will be an improvement in the earnings of auditors. There is a long term expectation that more auditors will venture into private practice thus creating employment opportunities. There will also be a growth in the number of auditing firms. A short-term prospect is that the auditing principles and practices will be improved further to enhance the curbing of embezzlement of funds and other fraudulent practices within businesses. The information systems will be advanced in the short term to enhance efficiency of audit systems (Mertins, Heisig & Vorbeck, 64).
Salaries and Benefits
An Internal auditor in the United States is likely to earn a median salary of about $50,274 to $61, 690. The company will compensate an auditor if he uses his personal finances during the conduct of his work. Some of the auditors receive benefits such as housing allowances and even travel allowances. They can also receive other benefits in kind in the course of their work.
Auditors indeed have a major role to play in business entities. They are indispensable for the accomplishment of the business as they see to it that there is responsibility and transparency in the conduct of business operations. They require a high level of skill and educational qualifications in order for them to be trusted with this major role in a company setting. It is therefore important that they should be properly remunerated as well as given a conducive working environment as this will motivate them to perform their tasks well. It is also important that auditors should adhere to the principles of auditing and carry out their work with utmost skill and diligence to ensure that they conduct a reliable audit. Auditors have become a great asset for business success.