What Is an Internal Auditor and How to Become One

Internal auditors are like silent protectors in an organization, quietly ensuring that everything runs smoothly and carefully while working to uphold the integrity and efficiency of an organization's operations.

In this article, we will delve deeper into what internal auditors do, how to become certified, and the job prospects in this field.

What Is an Internal Auditor?

An internal auditor is a professional responsible for carefully evaluating an organization’s operations, particularly in areas like managing risks, maintaining control, and overseeing governance processes.

Their job is vital because they ensure organizations follow all the rules and internal guidelines, helping efficiency, effectiveness, and compliance of an organization's operations. Using a structured method, internal auditors review the company's activities and suggest ways to make them better, aiming to solve problems before they become big issues or are caught in outside audits.

Internal auditors are also essential in keeping the company's financial reporting and operational practices up to standard.

What Does an Internal Auditor Do?

Internal auditors perform a range of duties, such as:

• Risk Management - Internal auditors proactively assess risks associated with the organization's activities, identifying potential threats to its objectives, and suggesting strategies to mitigate these risks.
• Evaluating Internal Controls - They assess the effectiveness of internal controls designed to safeguard assets, prevent fraud, and ensure accurate financial reporting.
• Compliance Audits - Internal auditors verify adherence to regulations and internal policies, ensuring the organization operates within legal and ethical boundaries.
• Data Analysis and Reporting - They analyze financial and operational data to identify trends and anomalies, and present their findings and recommendations in clear, concise reports.
• Collaboration and Communication - Internal auditors work closely with various departments, communicating their observations and collaborating to implement process improvements.
• Evaluation of Operations - Internal auditors analyze various aspects of an organization's operations, including financial activities, operational processes, and compliance procedures.
• Governance Processes - They evaluate the governance structure and practices within the organization, assessing the effectiveness of oversight mechanisms and the adherence to corporate policies and procedures.
• Efficiency and Effectiveness - Their role involves assessing the efficiency and effectiveness of the organization's operations, identifying areas where improvements can be made to enhance productivity and performance.
• Integrity of Financial Reporting - Internal auditors contribute to maintaining the integrity of financial reporting by ensuring the accuracy, reliability, and completeness of financial information.

These tasks collectively contribute to the internal auditor's overarching goal of providing assurance to management and stakeholders regarding the organization's operations, controls, and compliance efforts.

How to Become a Certified Internal Auditor

Even though there is no single specific path to becoming an internal auditor, some key steps can guide your journey:

• Education - Typically, a bachelor's degree in accounting, finance, business administration, or a related field is required. Some employers may even prefer a master's degree.
• Certifications - While not mandatory for all positions, pursuing designated certifications demonstrates your commitment to the profession and enhances your credibility.
• Experience - Gaining relevant experience through internships or entry-level accounting or finance roles would further improve professional competencies and provide other benefits.

Requirements to Become a Certified Internal Auditor

To become a Certified Internal Auditor (CIA), one must meet the following requirements:

• Education - Hold a Bachelor's degree or higher, possess an active Internal Audit Practitioner designation, or have five years of internal audit experience.
• Certification - Pass a CIA exam such as the “PECB Certified MS Internal Auditor” exam.
• Experience - Depending on the entry method, acquire the necessary work experience. The experience must be recent and relevant.
• Ethics – Commit to upholding the Code of Ethics.
• Continuing Professional Education (CPE) - After certification, CIAs are required to maintain their knowledge and skills and stay up-to-date of improvements and current developments in internal audit standards, procedures, and techniques.

PECB Certified MS Internal Auditor Training Course

The Certified MS Internal Auditor (CMSIA) training course offers a comprehensive learning experience designed to equip you with the necessary knowledge and skills for effective internal auditing.

The CMSIA training course provides participants with a deep understanding of internal auditing principles and practices in alignment with ISO 19011 guidelines and industry best practices.

Over the span of three days, attendees will delve into fundamental concepts, audit competencies, and practical methodologies essential for conducting successful internal audits.

Through engaging lectures, interactive discussions, and hands-on exercises, participants will gain insights into:

• Theoretical foundations and practical approaches to establishing and managing an internal audit program.
• Essential competencies required for internal auditors, including communication, critical thinking, and problem-solving skills.
• Effective planning, execution, and follow-up of internal audits to ensure compliance and drive continual improvement.

By investing in this training course, participants will gain the expertise and confidence needed to excel in the field of internal auditing, driving organizational success and ensuring compliance with industry standards and regulations. Join us on this journey to unlock your full potential as a Certified MS Internal Auditor.

A Rewarding Career Path: Internal Auditor Jobs and Salaries

Internal auditing offers a dynamic and intellectually stimulating career path across various industries.

The internal audit profession offers a compelling combination of competitive salaries and fulfilling work. While the specific figures can vary depending on location, industry, company size, and individual experience, here are some rewarding job positions in this field:

• Chief Audit Executive (CAE)

The Chief Audit Executive (CAE) is the senior executive responsible for overseeing the internal audit function within an organization. They lead the internal audit department, providing independent assurance and consulting services aimed at improving the organization's operations.

As the head of the internal audit department, CAEs hold immense responsibility. They report directly to senior management or the board of directors and play a crucial role in ensuring compliance with regulations, identifying risks, and enhancing internal controls.

The average annual U.S. salary of a Chief Audit Executive is $187,399.

• Director of Internal Audit

The Director of Internal Audit is a senior management position responsible for managing the day-to-day operations of the internal audit department. They report to the CAE and collaborate with other stakeholders to ensure effective audit processes and risk management practices.

Reporting to the CAE, Internal Audit Directors manage the department's day-to-day operations. They oversee audit planning, execution, and reporting, as well as the development of audit methodologies and procedures.

 The average annual U.S. salary of a Director of Internal Audit is $181,489.

• Internal Audit Manager

Internal Audit Managers are mid-level managers responsible for leading internal audit teams in conducting specific audits and providing recommendations to improve organizational processes and controls.

Internal Audit Managers play a crucial role in overseeing audit projects, ensuring compliance with audit standards, and managing audit staff. They collaborate with senior management to identify areas of risk and develop strategies to mitigate them.

The average annual U.S. salary of the Internal Audit Manager positions is $131,211.

• Senior Internal Auditor

Senior Internal Auditors are experienced professionals who lead and participate in audit engagements, providing expertise in evaluating internal controls, identifying risks, and recommending improvements to enhance organizational efficiency and effectiveness.

Senior internal auditors possess extensive experience and contribute significantly to the auditing process. They often mentor junior auditors, review audit work papers, and communicate audit findings to management.

Their annual U.S. average salary of a Senior Internal Auditor is $97,601.

• Internal Auditor

Internal Auditors are professionals responsible for examining and evaluating an organization's internal controls, processes, and procedures to ensure compliance with policies, regulations, and industry standards.

Internal Auditors perform audit procedures, such as testing controls, analyzing data, and documenting findings, to provide assurance on the effectiveness of internal controls and identify areas for improvement. They work under the supervision of senior auditors or audit managers.

The annual average U.S. salary of an Internal Auditor is $85,078.

Note: The salaries of the above-mentioned positions are not definitive and they may change with time and industry development.

Conclusion

In conclusion, the role of an internal auditor is paramount in maintaining the integrity, efficiency, and compliance of an organization's operations. Through careful evaluation of internal controls, risk management, and compliance audits, internal auditors safeguard organizational assets and contribute to its overall success. To embark on a career path in internal auditing, individuals typically pursue education, gain relevant experience, and obtain certifications to enhance their professional credibility. Moreover, internal auditing offers rewarding career opportunities across various industries.

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About the Author

Vlerë Hyseni is the Digital Content Specialist at PECB. She is in charge of doing research, creating, and developing digital content for a variety of industries. If you have any questions, please do not hesitate to contact: support@pecb.com.