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Working as an auditor

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Working as an auditor

Remember Bernard Madoff, the investment advisor who ran a multi-billion dollar Ponzi scheme that lasted for two decades? Madoff managed to get away with it for so long in part because his auditor, David G. Friehling, failed in his responsibility to thoroughly examine Madoff's books.

Friehling is hardly typical of auditors -- the profession has high ethical standards. His crimes, for which he pleaded guilty in November 2009, highlight the important role auditors play in keeping organizations honest in their accounting and business practices.

What they do:

Auditors monitor the finances and operations of organizations, helping to determine acceptable levels of risk and guarding against fraud, theft and waste. They are also responsible for making sure an organization follows internal controls -- procedures designed to ensure efficiency, accuracy in financial reporting and compliance with regulations and laws.

Auditors work for a wide range of entities, from small nonprofits to large corporations. They play an important role in local, state and federal governments, where they track the use of taxpayer money and analyze the soundness of budgets and spending.

Auditors frequently work in two different capacities. External, or independent, auditors provide outside evaluations of financial statements and business practices (what Friehling was supposed to do). Internal auditors work within organizations, assessing financial and operational health. Because of their thorough understanding of these issues, internal auditors often move into upper management positions, according to the U.S. Bureau of Labor Statistics.

What they need:

Auditors typically need at least a bachelor's degree in accounting or a related discipline from an accredited college or university. Master's degrees, including Master of Accountancy and Master of Business Administration in Accounting, are helpful for those who hope to advance in the field. Enrolling in a master's degree program is an increasingly common way to fulfill the education requirements for the certified public accountant (CPA) license.

Some auditors are licensed as CPAs, which is useful for a couple of reasons. CPA licenses are required for accountant filing with the Securities and Exchange Commission, which auditors sometimes need to do. A license also provides flexibility should an auditor move into another area of accounting that requires one.

In addition to licensure, auditors can become certified by one of several professional organizations. Though not mandatory, these certifications are often highly preferred by employers.

An alphabet soup of certifications is available: the Institute of Internal Auditors offers the following designations: Certified Internal Auditor (CIA), Certified in Control Self-Assessment (CCSA), Certified Government Auditing Professional (CGAP) and Certified Financial Services Auditor (CFSA). The Information Systems Audit and Control Association offers the Certified Information Systems Auditor (CISA) designation.

What they earn: puts the national average salary for auditors at $73,935, with the 25th percentile at $57,682 and the 75th percentile at $102,366.

Job outlook:

Job prospects for auditors are good in the near future, according to the BLS. The combined category of accountants and auditors is expected to see 22 percent employment growth between 2008 and 2018, which is much faster than the average for all occupations.

Last Updated: 02/06/2011 - 12:19 PM

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