AuditorIf you have ever given thought to working within the financial sector, you may have wondered about what processes you must complete to become an auditor. Below you will find basic information regarding the types of educational requirements, certifications, and experience one should obtain in order to become a marketable job candidate within this field.

Auditor – A Brief Overview

An auditor is an individual who prepares and examines a business’s financial reports and records. To facilitate the optimal financial functioning of the businesses they work for, auditors ensure that taxes are paid in a timely manner while also making sure that financial records are as accurate as possible. To accomplish these objectives, auditors analyze financial operations and perform work that precipitates the efficient functioning of an organization.

Becoming an Auditor

Generally, individuals who wish to become auditors will obtain a bachelor’s degree in a field such as accounting. In earning this degree, the aspiring auditor will obtain the information and experience necessary to succeed in the field. There are three types of accounting degrees one can earn: the associate’s, bachelor’s, or master’s. According to the article, Should I Earn an Accounting Degree?, most employers will require that job candidates obtain a bachelor’s degree in accounting or a field related to accounting. If you opt to obtain an associate’s degree, the process will typically take around two years. Those who choose to earn a bachelor’s can expect to be in school for four years. Finally, individuals who opt to obtain a master’s can typically do so within two years after earning their bachelor’s.

Keep in mind that most employers require at least a bachelor’s degree for their auditor positions. It’s also possible to major in accounting with a specialty in auditing. Earning a master’s degree allows you to advance into a management position or perform specialty auditing services. For example, many universities offer programs in areas of expertise like internal auditing.

Training and Experience

Taking classes in accounting and auditing is only part of your educational experience when you become an auditor. Another required aspect of the process for most degree programs is an internship. Many of these programs take place during the summertime, although you may be able to earn college credit for them. You’ll have a preceptor and typically be the lead on a specific project related to accounting or auditing.

Accounting Certification – A Brief Overview

How Do I Become an Auditor?

In addition to attaining a formal degree, individuals who choose to become auditors should think about the value of obtaining the certification necessary to become a Certified Public Accountant (CPA). Earning this certification can improve your likelihood of getting a job within the accounting sector, and some employers may even require that you have it in order to gain employment with their company. The Uniform Certified Public Accountant Examination is used in all fifty states of America as well as Guam, the District of Columbia, the U.S. Virgin Islands, the Northern Mariana Islands, and Puerto Rico. The American Institute of Certified Public Accountants (AICPA) develops, maintains, and scores the CPA Exam. The exam is administered through Prometric test centers that work in conjunction with the National Association of State Boards of Accountancy (NASBA).

If you want to become an auditor and have more job opportunities, becoming a Certified Public Accountant is a must. You’ll have to do this if you ever want or need to file an accounting report with the United States Securities and Exchange Commission. In order to attain the certification as a public accountant, most states require 150 college credit hours. This is about 30 hours more than most four-year degree programs. Some universities offer a five-year combined bachelor’s and master’s degree program with 150 credit hours. You don’t have to earn a master’s degree in order to sit for the exam for a Certified Public Accountant.

Some employers will hire auditors and accountants who don’t yet have the Certified Public Accountant status. They may pay you to get the certification, or they may at least pay your expenses and allow you to attend classes during the work day. To gain the Certified Public Accountant status, you have to pass a four-part Uniform CPA Examination. This exam is administered by the American Institute of Certified Public Accountants. You don’t have to pass all four parts at the same time, but you do have to pass all four parts of the exam within 18 months of taking it for the first time. You have to pay a fee for each time you take the exam.

When you become an auditor, you may also want to earn the Certified Internal Auditor designation. This requires at least two years of experience working as an auditor. Once you have that experience and a four-year college degree in auditing or accounting from an accredited university or college, you qualify to sit for the four-part exam. This exam is offered by the The Institute of Internal Auditors. If you pass the exam, you can earn Certified in Control Self-Assessment (CCSA), Certified Government Auditing Professional (CGAP), Certified Financial Services Auditor (CFSA) or Certification in Risk Management Assurance (CRMA) status.

You may also want to become an auditor with the Certified Information Systems Auditor (CISA) designation. This is for auditors with at least five years of experience with auditing large information systems. College classes in auditing, information systems, financial or operational systems may give you up to three years of credit toward the experience requirement.

Important Qualities in an Auditor

How Do I Become an Auditor?

If you want to become an auditor, it helps to have certain personality characteristics that are directly related to satisfaction and success in this area of expertise. To become an auditor who is successful, you’ll need to have high attention to detail. An ability to focus closely on the task at hand is also critical. Auditors must have excellent mathematics and logic skills. They should be able to identify issues in documentation and suggest ethical solutions. For example, an internal auditor would use these skills in order to identify fraudulent activity on tax filings.

Another essential characteristic of an auditor is an ability to communicate well. They need to listen to the facts as presented by their employers and clients. They should be proficient in English, including written and spoken communications. Their ability to write must include accurate and precise information that is clear and consistent. An auditor should be able to have a discussion about their methods, findings and results. They should be able to explain auditing information in both a technical way to other accountants and in terms that a layperson can understand.

Auditors need to be detail-oriented. A big difference in a process or procedure can occur if a detail is missed. A small detail can make a big impact on a tax filing or decision on whether a particular piece of information is accurate.

Organizational skills are also a must for auditors. They should be able to organize printed materials as well as digital materials. Audits can go back as far as seven years, so they will have a lot of information to keep track of. Maintaining an excellent organizational system will make the job of an auditor less complicated.

Although complex mathematical skills aren’t necessary for an auditor, a person who wants to become an auditor does need to know mathematical concepts, formulas and operations. Most auditing is done digitally and with the help of software packages. To that end, an auditor will need to be comfortable with technology and able to keep up with changes in software packages and operating systems.

Starting Salary for an Auditor

As of May 2019, the median annual wage for an auditor was $71,550. This includes auditors who have been working in this industry for a while. A typical starting salary is closer to $60,000, but this may also depend on the certifications, experience and degree held by the individual. Large corporations tend to offer higher starting salaries compared to auditors who work for local, state or federal government agencies. A person who has accounting experience, a master’s degree and one or more professional certifications can expect a starting salary that is competitive.

Typical Pay Ranges for Auditors

The Bureau of Labor Statistics collects salary data for all occupations, including accountants and auditors. The lowest-paid 10% of auditors earned $44,480 per year as of May 2019. The highest-paid 10% of earners had a mean annual wage of $124,450. The highest-paying industry for auditors is finance, with a median annual wage of $76,440. Auditors in the management of companies and enterprises earned a median annual wage of $74,060. Those who work in the accounting, tax preparation, bookkeeping and payroll services industries earned a median annual salary of $71,390 per year. Auditors who work in local, state or federal government have the lowest median salaries at $70,180 per year.

Salary Information By State for Auditors

The top paying states for auditors are District of Columbia ($103,930), New York ($98,650), New Jersey ($91,960), Virginia ($85,720) and California ($83,910). Keep in mind that the cost of living in some of these areas is higher than the national average. Most auditor jobs are in large metropolitan areas, which also have a higher cost of living compared to suburban and rural areas of the same states.

Salary Information by Metropolitan Area

The Bureau of Labor Statistics also tracks wages by metropolitan area. New York City’s metropolitan statistical area is the top-paying one for auditors. There, an auditor can expect to earn a median annual wage of $102,090. Salinas, CA, is the second-highest paying metropolitan statistical area for auditors, where the median annual wage is $$97,640. District of Columbia, San Francisco, CA, and Bridgeport, CT, round out the top five paying metropolitan statistical areas for auditors.

Where Most Auditor Jobs Are Located

California, Texas, New York, Illinois and Florida are the five states with the largest numbers of jobs for auditors. These states also offer higher than average annual salaries for auditors. Another way to consider where most auditor jobs are located is to examine the location quotient for the occupation. This is the number of jobs divided by the population. The areas with the highest location quotients of auditors are District of Columbia, Colorado, New York, South Dakota and Delaware.

Work Environment and Hours for Auditors

How Do I Become an Auditor?

Most auditors work in an office setting. Some may travel from their home office to the offices of their clients. Throughout most of the year, auditors work typical business hours. Auditors who are employed by international companies may work different hours in order to be accessible to workers in other time zones. During tax season and around the times that quarterly estimated taxes are due, auditors may have to work overtime hours.

Expected Job Growth in Auditing

The job outlook for auditors is a 6% rate of growth between 2019 and 2029. This is about as fast as the rate of growth for all occupations tracked by the Bureau of Labor Statistics. Globalization will play a big role in the need for more auditors. This is because taxes and accounting are complicated for multi-national corporations and international commerce and trade. Automation will make some tasks less complicated, but auditors will still be needed to advise and analyze information for their employers and clients.

Other Considerations

Earning a degree as well as the CPA certification are both great steps you can take towards becoming an auditor. Additionally, you can make yourself an even more marketable job candidate by completing an internship. Internships are valuable for many reasons, including the fact that they provide you with the type of hands-on experience that grants you an understanding of how the world of accounting really works. In gaining this experience, you will likely be able to better handle the transitional period from the world of the accounting classroom to the world of actual work. Additionally, attaining and completing an internship affords you the opportunity to network with potential employers and other individuals who may become mentors or colleagues.

Related Resource: Certified Internal Auditor

Conclusion

If you have ever given any consideration to becoming an auditor, you should know that doing so can function as the start of an amazing career. Now that you have a basic understanding of how to become an auditor, you can begin the process of accomplishing your professional goal.

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