Financial Auditor: Job Details

The financial auditor title is often used interchangeably with the accountant position, but the two careers have notable differences. A financial auditor ensures that a company's financial statements are in good order and in compliance with generally accepted accounting principles (GAAP). Financial auditors and accountants perform similar tasks in terms of the review of financial data, but auditors are more focused on discovering fraud or error in corporate financial documents.

Job Description

A financial auditor reviews a company's financial statements, documents, data and accounting entries. Financial auditors gather information from a company's financial reporting systems, account balances, cash flow statements, income statements, balance sheets, tax returns and internal control systems. The information is then reviewed and used to present all financial data relating to a specific organization in an accurate, fair manner, ensuring that no fraud or gross errors are present in the company.

Financial auditors speak with multiple departments, including low- and high-level management teams, accounting and finance personnel, and company executives in their pursuit of analytical data. These discussions focus on gaining understanding of the company's purpose, its operations, its financial reporting systems, and known or perceived errors in organizational systems. Financial auditors conduct interviews of key personnel to comprehend what accounting and finance tasks are taking place, and which tasks, policies or procedures may need to be established or implemented more efficiently.

On a day-to-day basis, financial auditors use analytical skills to assess accounting and financial reports by testing the documentation of transactions that the company has provided. Analysis also includes observation of inventory and the processes used for managing inventory counts. Additionally, financial auditors review accounts receivable, invoices, vendor payments and billing procedures to ensure compliance with accounting guidelines.

The information gathered from a financial auditor's analysis is used to develop recommendations and specific action items for the organization where an audit was performed. Financial auditors often suggest changes to internal controls and financial reporting procedures to enhance the company's efficiency, cost effectiveness and overall performance. In some instances, they must attest to the information presented through the audit. This attestation represents a stamp of approval for the company's accounting procedures and financial reporting systems. However, financial auditors do not take responsibility for the company's accounting practices or discovered errors.

Unlike corporate or management accountants, financial auditors do not reconcile accounts, nor do they make accounting entries for an organization. Instead, they provide the information necessary to correct errors and accounting fraud to accounting or other finance personnel. They also do not implement changes to accounting or finance policies or procedures in a company.