What is Audit Accounting?
Audit accounting plays a critical role in ensuring that an entity’s accounts are accurate and that its finances are being distributed in the fairest and most efficient manner. However, you may be thinking that what is audit accounting and how it can add value to the operations of an entity. Today, we will discover what audit accounting is and why it is being considered as a popular career option for a number of business graduates all around the world.
Increased scrutiny over accounts and finances has forced many organizations to engage audit accountants to help them in reviewing their accounting and other financial records to ensure that they are accurate and compliant.
Many businesses are using audit accounting as an internal tool for identifying critical business risks requiring attention as well as identifying and highlighting areas where cost saving can be done. On the other hand, many businesses are also using audit accountants as independent specialists for carrying out independent external audits of their books and operations.
How is Audit Accounting Different from other Accounting and Finance Roles?
Audit accounting is different from other accounting and finance roles as it involves financial accountability which means that an audit accountant must work to strict time schedules and deadlines, with a keen eye for details as well as willingness to challenge the establishment. On the other hand, an accountant’s prime responsibility is to maintain accounting books as well as provide support and advice on bookkeeping, tax returns, and cash flow matters. In other words, an audit accountant dwells deep into the records looking retrospectively at the financial statements of an entity while an accountant simply ensures that an entity’s accounting records are up-to-date and are being maintained in accordance with the entity’s policies, applicable accounting standards, and relevant rules and regulations.
Audit accounting is also different from roles such as investment banking and asset management, as it focuses its attention on objectives surrounding compliance and governance rather than increasing an entity’s wealth or funds.
The role of audit accounting is all about ensuring that the entity’s books show a true and fair view of the entity’s financial position and performance.
Types of Audit Accountants
Generally, audit accountants are categorized into two types:
- Internal audit accountants; and
- External audit accountants
Internal Audit Accountants
Large business entities, especially those that operate in highly regulated business sectors/ industries opt for hiring audit accountants to help them in achieving compliance with all the applicable laws and regulations.
In addition to ensuring that the entity’s accounting books are complete and accurate, an internal audit accountant will also help the entity in identifying and highlighting areas where improvements can be made which will help the entity in becoming more efficient and effective in its operations and business dealings.
External Audit Accountants
Being an external audit accountant can provide one with the opportunity to work with different organizations, audit their accounting books to ensure that they are complete and in compliance with the applicable rules and regulations.
As an external audit accountant you can be asked to examine allocation of funds to public bodies/ institutions, evaluate financial position and condition of private firms working and collaborating with government institutions/ organizations. Audit accountants measure a variety of metrics, depending on whom they actually work for.
Essential Skills for Audit Accounting
If you want to be a successful audit accountant then you must possess the following skills:
- Strong communication: it’s easy to express what you feel, whether on a piece of paper when writing up a report or presenting your findings and opinion in a meeting, if you have good communication skills.
- Scrutiny: An audit accountant should always be ready to spot fraud, error, omissions, and loopholes in system and other anomalies.
- Time management: you should be able to manage your time between different tasks and meet all the set deadlines
- Problem-solving: As an audit accountant you should possess the skill to either resolve or suggest a viable solution to resolve an identified problem/ issue.
Scope of Audit Accounting Role
Audit accounting is emerging as one of the go-to career options for a number of fresh accounting and finance graduates as more and more organizations, whether public or private, are hiring audit accountants to keep up with the compliance measures.