Auditors are used in a range of organizations and industries, usually to analyze financial data and records and make sure everything is as it should be. Whether you want to become an auditor, or run a business and are considering whether to use one, auditing is important for everyone involved in the business or organization, from the owner to the employees, and those using the services provided.
What is auditing?
Auditing involves an independent examination of the financial records of an entity, such as a business or healthcare provider. The main aims of an audit are to ensure that the agencies, companies or individuals that are being examined are complying with tax laws, and also to check for waste and fraud within the entity. There are many areas in which auditors work, from healthcare auditing companies to finance or manufacturing.
Who is it for?
In some areas, audits are legal requirements, so it is important to ensure that you understand the rules when it comes to this and your business. Even when you are not legally required to have one, many people do still choose it. There are many benefits to having an audit, financial or otherwise, such as:
- Obtaining loans – If a bank can see that your finances are correct, and that you have a good track record, they may be more likely to provide you with a loan
- Insurance – When insurance is being claimed, an audit will be done to assess the amount of damage, and therefore the amount of compensation that can be given, as well as being able to see if they amount that a business is claiming for compensation is correct.
- Determining profits or losses – Financial audits can give a good overview of all of the financial elements of the business, helping determine future decisions within the organization.
- Detect fraud – One of the main aims of a financial audit is to ensure that no fraud is occurring anywhere in the business. Audits can also help to prevent fraud, as if the company knows it is being done, fraud is less likely to take place.
- Evidence – Audits collate plenty of valuable data from the company, which can be used as evidence when needed.
- Goodwill – When a business allows an audit to take place, it shows that the organization has nothing to hide, which boost the image of the company to others, such as investors.
How do you become an auditor?
In order to become an auditor, you will generally need a bachelor’s degree in finance or accounting, or a related subject. Many auditors work alone, although some collaboration is required, as is some travel, and there are also voluntary certifications that you can undertake to progress your skills and knowledge.
An auditor working in the healthcare industry would typically be looking into the financial records and activities of a healthcare organization, as well as examining if current policies are working, identifying deficiencies in reimbursements and ensuring the appropriate documentation is present and correct.