When a company is experiencing difficulty controlling their accounting functions, hiring an internal auditor may alleviate some of the problems. Internal auditors may perform a variety of services including operational audits, compliance audits, and financial statement audits. Additionally, an internal auditor can assist in development of internal controls and evaluate the effectiveness of computer systems (Arens, Elder, & Beasley, 2006). A company must evaluate the experience and educational background of a potential internal auditor before making a decision to ensure the auditor is capable of meeting the company’s needs.
Benefits of Internal Auditor
Operational auditing is perhaps the most beneficial use of an internal auditor for a company experiencing difficulty controlling accounting functions. Operational auditing focuses on making recommendations on efficient use of resources, achievement of business objectives, and compliance with company policies (Louwers, Ramsay, Sinason, & Strawser, 2007).
An operational audit gives a three dimensional perspective of a company. Financial statements can highlight a problem, but it cannot show how the problem began. The internal auditor can conduct interviews with essential personal to determine what changes are necessary. Additionally, an operational audit may uncover future problems while reviewing the effectiveness of current policies. Operational audits are beneficial because it can uncover problems early and fix them before they cause significant damage to the company’s financial health (Vos, 2001). The operational audit process lends itself to developing internal controls and evaluating the effectiveness of computer systems.
Compliance audits focus on determining whether the company is following applicable rules and regulations. The rules may be either company policy or external laws and regulations. Internal auditors generally conduct a compliance... [continues]
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