Auditing & Control

Auditing is a high-risk job as the financial health of a business organisation depends on it. In Accounting, audit is the inspection of various books of accounts and inventory to ensure that all the departments are documenting the transactions correctly and carefully. The audit is often done by a third party to establish the accuracy of financial statements provided by an organisation. The quality of financial statements largely depend on the quality of audit, i.e. strong internal control system. To ensure the resources are being optimally utilised and there is no mismanagement, auditors need quality tools and technology.

The tools used for performing an audit for the client include 'Tests of Control' which help in providing a closer look at the client’s internal control systems. 

Tests of Internal Control

What are the tests of internal control? This is the most common question asked with respect to auditing. Tests of internal control are a set of procedures which the auditors follow to evaluate the organisation’s internal audit. The internal audit includes an objective review of the company’s processes and systems. Internal audit is done by a competent employee of the organisation.

The third party auditor then evaluates the internal audit report with the help of tests of internal control to verify the findings. The purpose of using tests of internal control in auditing is to ensure prevention of risk or mismanagement of funds. Another key aspect of auditing process is test of details. It is done to obtain key evidence to support the overall audit of the company’s balance sheet.

The auditor assess the effectiveness and reliability of the internal control of the company on resources. If they find it satisfactory, the auditor will reduce substantive testing procedure and if the internal control is not satisfactory, the auditor will increase it.            

Auditing and Control

The key procedures auditors normally use for performing tests of control are listed below:

• Inquiry: This involves seeking an understanding of the control processes from the client. The auditor inquires all about the procedures undertaken by the company for internal audit.
• Observation: The auditor observes a business process or transaction in real time making a note of the control elements and procedures.  
• Reperformance: The auditor conducts a transaction to repeat the internal controls used by the company, to have a practical experience of audit control and gather evidence to be relied upon. This is the best sampling method to assess the transaction.
• Inspection: This procedure involves inspection of business documents such as bill and invoices, signatures, stamps, approvals and verifications, etc. The auditor can look at a random transaction to check if the due procedure has been followed during internal audit or not; and make assessment accordingly.
• Confirmation: After making the assessment, the auditor confirms whether the internal audit control is robust or requires further action.

Auditing & Control Courses

Auditing as a task is an essential aspect of running a business enterprise successfully. Auditors are hired for tests of internal control in every sector and industry. Be it Banking and Finance or Information System, auditing is one of the main concerns of business organisations. The need to be in compliance with government norms and to assure that the systems and operations perform as per expectation, auditing and internal control are a necessity.

Given the significance of auditing, it is needless to say that it has great career prospects. With professional training in auditing and test of controls, one can go places.

The courses are open to professionals with graduation degree. The field of auditing is most preferred by Commerce graduates as the demand for financial auditors is high in the job market.

Auditing courses are offered in full-time as well as part-time education mode and candidates can choose from degree, diploma and certification programmes. Since, Auditing is a professional course, part-time and short-duration and hybrid programmes are more popular.

Auditing & Control Courses Eligibility Criteria

To pursue auditing as a profession one needs to fulfill the following eligibility criteria:

• The minimum qualification required to become an auditor is graduation in Commerce and Accounting
• For auditing roles in other domains, one must obtain the relevant certification. Several certifications are offered by the ICAI, ICSI and ICWAI. One can also obtain certification in auditing from international organisations such as Institute of Internal Auditors (IIA) and Information Systems Audit & Control Association (ISACA).

Skillset Required for Auditing and Control

Those planning to take up auditing as career must develop the followings skills to have a successful career:

Auditing and Control: Career Prospects, Job and Salary

As mentioned earlier, career prospects in this field are bright and there are a lot of opportunities in various sectors. Auditing is required to be done for not only private companies but also for government organisations, public sector undertakings and non-government organisations. Thus, one can find a suitable auditing role as per qualification for a good pay package. Given below are the three most popular job roles in auditing:

Internal auditors: This profile includes responsibilities such as evaluation and reporting of financial controls of the organisation and advising the best methods to minimise financial risks and protect the financial health. Internal auditors are hired by a company as a full-time employee to ensure that the controls are being followed efficiently.

External auditors: They work individually or through auditing firms for client companies. Their main job is to understand internal test controls, evaluate and verify whether audit procedures being used protect financial risks or is there a need for change. They create reports on the financial statements to be shared with the organization’s shareholders and other stake holder.  One of the main responsibilities of external auditors is to detect fraud.

Tax auditors: As the job title suggests, tax auditors are concerned with tax statement and tax laws. Their main job is to ensure that the company and its employee function in compliance with the country’s tax law and that there is no instance of tax evasion...

Auditing Job Roles and Salaries

Given below is the table indicating average salary offered in India to certified auditors in various job roles:

Auditing and Control: Top Recruiters

Given below is the list of top companies, which hire financial auditors in various capacities:

FAQs on Auditing and Control

Q: What is Auditing and Control?

Q: What is the qualification required to make a career in Auditing and Control?

Q: Which stream of education is the best for a career in auditing?

Q: Which Indian organisations provide auditing certification?

Q: Which are the international organisations for auditing certification?

Q: Which are the top colleges in India for courses in Auditing and Control?

Q: What does an auditor do?

Q: What is the job role of an auditor?

Q: What is the average salary of internal auditor in India?

Q: Which type of organisations hire auditors?

Q: Which are the top audit firms in India?