what do you do as an auditor? (1 Viewer)

[O2]

hey, this is my first thread/post, but a long time reader.:wave:

I was a CA achiever for 2006, and i worked at a mid tier firm in melbourne in the audit division.

Although i was only in the audit division for one week (3 week placement in which the other 2 were spent at bus services, n bus insolvency), i didnt learn all that much about what auditors do.

What i saw was basicaly, accountatns (auditors) moving from client offices to other clients doing teh same or not exactly the same, but similiar work.

Basicaly what i'm trying to say is it seemed a little repetitive. Does it get more interesting, self fulfilling. SOmething that i can talk about, as lawyers in films do, or will it remain just a JOB?

Plz help out a boy with declining motivation for what he will step into for the REST OF HIS LIFE.

 

[turtleface]

Slowly, I've come to develop a somewhat basic audit involves through work exp (incl the CA Achiever program you're on) and research.

But firstly to roughly quote a former ICAA president:
'very few people fully knows whats involved with an audit"(not an exact quote)

My personal opinion is that noone fully understands what being an auditor is about until they reach the Partner level/become a properly registered auditor with ASIC (with their special RCA (Registered Company Auditor) number ). Non registered auditors are more like "auditor's assistants"

At our low level, we do most of the audit grunt work (i.e. a lot of data entry into Excel, referencing figures, analysing Trial Balances, Balance sheets and profit and losses, mostly all the stuff for documentation purposes, and also so more senior people can then use the documents) (i.e. the box ticking and the number crunching - though data entry would be a more accurate description)

As you get more experienced you start going into the internal controls and interviewing clients and getting to know their business processes where you identify business risks etc.

Basically the entire substantive section of the audit is performed by low level people with 3-4 years and less experience, with the very low level performed by the graduates and vacationers and co-ops and cadets etc.

Which leaves the question of what do the managers, senior managers, directors/principals (if applicable) and partners do. And I do not know, but they must obviously do something to earn their money.

THe stuff I have learnt so far on what they do is: decision making on things like complex accounting issues, decide on the materiality figures, involved in reviewing the work of the junior people (managers more so than partners), interacting with clients more at a high level (i.e. with the CEO and Directors) as well as business development

As for interest/fulfillment, people do say audit is boring, but it does get less mechancial and boring as you go up the ranks. Also, remember its a job. Find me one job that won't eventually get boring. I think because the Big 4 have such a collegial environment, even though the work may sometimes be boring, but because you are with a large cohort of similar aged people its almost like being back at uni.

One last point RE: the law, is that audit is probably the 2nd most law related area of accounting besides insolvency/corporate recovery . Its all regulations. Audit is probably one of the most heavily regulated professions internationally. There are about 20 oversight bodies, about 3 sets of standards etc. that must be complied with

I think what I've said is correct, but more people will add their views/correct me

 

[Conspirocy]

guys don't worry I'm here. I'll handle this.

An auditor...audits people.

 

[seremify007]

I agree with what turtleface said in terms of what auditors do. I think apart from the obvious jobs for managers (ie. allocation of resources, billing, client retention, etc..), they also serve as ultimate decision makers and make the call as to what level of assurance is required, whether or not we can accept "questionable" behaviour, and also have the power to tell the client to do something or make adjustments. Ultimately, it's their credibility on the line if they miss something.

One of my clients gave me the best analogy of an auditor today;
"An auditor is like the plumber of accounting. They go through other people's accounts looking for shit."

 

[drewgcn]

Screw people over.

 

[AppleXY]

"An auditor is like the plumber of accounting. They go through other people's accounts looking for shit."

LOL

 

[seremify007]

What i saw was basicaly, accountatns (auditors) moving from client offices to other clients doing teh same or not exactly the same, but similiar work.

Well it depends alot on the client but whilst the general work/principles are the same, what you'll find is that there's always something difficult about a particular client whether it be.. it's difficult to trace revenue, it's difficult to get a complete listing of transactions, etc... and then the unique challenge of each client is coming up with an alternative way to gain assurance without doing the typical test. Some seniors I've found encourage the younger people on the team to try and figure out these "alternate" strategies and sometimes it is quite satisfying to know that your debits and credits knowledge can come in handy.

Basicaly what i'm trying to say is it seemed a little repetitive. Does it get more interesting, self fulfilling. SOmething that i can talk about, as lawyers in films do, or will it remain just a JOB?

The basics are repetitive. But I've never felt bored. What I have felt is 'stress' and 'annoyance' even if it's beyond my control such as when a client isn't able to provide you with the necessary documentation to do your work or just aren't being very helpful with answering your questions... whilst it's beyond your control, when you have a deadline to meet and your name is on the line, you don't want to look like a screwup.

That being said, there's probably a good reason why people don't stay in audit for too long. It's more of a stepping stone as it's like an easy way to gain a general overview of how the business links together. Even if at high level, you learn how to make connections between items on the balance sheet and P&L. Not to say that I'm an expert on share trading, but I'd imagine that if you can understand financial statements, it could be a useful skill to have.

Anyway, what turtleface said is quite true. The young'ns will do a lot of the grunt work with checking invoices and so on... but there's also a bit of thinking involved at times. But it's not long before you reach senior where your job becomes much more focussed on delegating work, managing the team and client, and reviewing work.

EDIT: Forgot to mention, a lot of people don't like auditors (in case you didn't already know). But then, from an employee's perspective... auditors rock up, mess up your books, try to find a time where you've slipped up and screwed up (and half the time there's a good explanation or they simply misread something), and they also take up your time. In other words, the more challenging part to audit is balancing between pushing the client to get what you want, but not pushing too hard that you ruin the client relationship.

 

[O2]

well all that info been very helpful,

But you mentioned that auditors usualy use there position as a stepping stone.
I dont imagine myself staying in audit for rest of my life, but i am wondering what other options are available for an auditor to move to, after reachging a more senior position, and possibly with a CA.

What in your opinions would you think the positions that would welcome an auditor in industry moving from chartered environment.

Is CFO, financial controller, etc, a compatible with an audit experienced accountant? or is it more a position of internal audit??

 

[alby]

seremify: you seem to know what you're on about (sorry to kill the thread slightly)
my charity's getting audited soon. its our first time, we've only been around for 6mths. our auditor sent us an email saying he needs "the Books, bank statements,and the Audit requirements,ie:What the Govt.requires"...what are these requirements? havent been able to find anything on the dgr's site (+ google searches) to tell me what they are

 

[SSaint]

What in your opinions would you think the positions that would welcome an auditor in industry moving from chartered environment.

Is CFO, financial controller, etc, a compatible with an audit experienced accountant? or is it more a position of internal audit??

After working in audit and getting your CA/CPA you would have plenty of options, you could work in finance/accounts departments in commerce and industry, you could comfortably move into the financial service sector as well (most likely in corporate finance rather than trading etc). Generally holding a CA/CPA qualification would attract a premium wage as well. This career path is definitely compatible with a CFO role, provided you've got the experience and are good at what you do.

 

[roadcone]

auditors tick accounts with green pens and check excel spreadsheets.

 

[turtleface]

Is CFO, financial controller, etc, a compatible with an audit experienced accountant? or is it more a position of internal audit??

most controllers are from audit backgrounds. most CFOs are ex controllers (in aus)

auditors tick accounts with green pens and check excel spreadsheets.

blue pens!

 

[seremify007]

well all that info been very helpful,

But you mentioned that auditors usualy use there position as a stepping stone.
I dont imagine myself staying in audit for rest of my life, but i am wondering what other options are available for an auditor to move to, after reachging a more senior position, and possibly with a CA.

Basically if you work in audit, you'll get a general understanding of the whole business. It's kindof like the jack of all tracks aspect, but that's what makes auditors good at becoming CFOs/CEOs later on since they understand how things interrelate without any particular bias to a section.

From what I've seen, most people after audit move on into something which is highly specialised audit (eg. M&A TS due diligence work, Internal Audit, Forensic Accounting, etc...), with a few moving straight into FC roles. On the other hand, some move into more consultancy-style work based on what they learnt from successful businesses in terms of structure, policies, culture, etc...

Is CFO, financial controller, etc, a compatible with an audit experienced accountant? or is it more a position of internal audit??

External audit naturally leads to internal audit. Whilst you're doing it for different reasons, ultimately in both cases you're trying to help make people feel more safe about something whether it be the financial statements, the controls over something, likelihood of fraud, etc... someone I talk to regularly actually started off in external audit, moved into internal audit, and worked his way up to FD.

So to answer your question, yes it's all compatible with audit. Audit is a very 'introductory' accounting in my opinion... you don't really focus on anything in particular, but you build up your skeptical mindset so you can tell when something is a bit 'dodgy' and when things are good.

Sorry for the poor explanation if it doesn't help!

seremify: you seem to know what you're on about (sorry to kill the thread slightly)
my charity's getting audited soon. its our first time, we've only been around for 6mths. our auditor sent us an email saying he needs "the Books, bank statements,and the Audit requirements,ie:What the Govt.requires"...what are these requirements? havent been able to find anything on the dgr's site (+ google searches) to tell me what they are

I think you'd be best off asking your auditors exactly what they want from you. To be honest, I'm not really sure what that means... usually for us, we have a generic list of things we need from clients for us to commence our audit and we give it to them in advance. My only guess would be that apart from the general ledger/accounting software and bank statements/recs, they might be looking for formal ASIC documentation?

Anyone else here got any ideas?

EDIT: Thinking about it a bit today in the car wondering what it was.. one idea that floated into my head was maybe the auditor is requesting the documentation you were planning to submit to ASIC (ie. the financial statements)? Everything from the P&L, BS to the Notes explaining Accounting Policy choice and so on.

 

[Minai]

Some senior accountants I knew personally that had gotten their CA had moved on to various Financial Accountant roles...One senior manager in our division left after 10 years at EY to be a assistant financial controller at some large corporation...

 

[redruM]

If you are going to work as an auditor, be ready for excel to molest you for 9 hours a day.

 

[seremify007]

Some senior accountants I knew personally that had gotten their CA had moved on to various Financial Accountant roles...One senior manager in our division left after 10 years at EY to be a assistant financial controller at some large corporation...

That applies to most firms I'd imagine... it's like the cause of high turnover!

 

[Minai]

Hence the need for weekly/monthly drinks, extravagent end of audit events and the like...lol

 

[jase_]

Auditing can get tedious and boring sometimes, especially at the junior levels. I suppose once you get to senior and manager levels it can become more interesting but it depends if you can last the 2-3 years doing all the boring work. I guess if you really want to get into auditing then there are lots of different things you can do in audit, as people above have mentioned you can move into internal audit which is more interesting. You can also do IT audits which support the financial audits if you have an interest in IT, which involves different procedures to that of financial audits, though the general audit concepts are the same.

I suggest getting some more experience before committing yourself long term in audit, just to see if you really like it or not and if you can manage to stand the work day in, day out.

 

[O2]

all good responses.

I was forced to search for myself, and i found a good website with many differnt types of careers and all sorts of information.

http://www.princetonreview.com/cte/profiles/dayInLife.asp?careerID=1

Theres a search career option on the left side of the screen..

Again, thanks for all the comments.

 

[watatank]

Isn't an auditor one who makes sure all financial records and statements are correct?