How to Become an Auditor
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- Auditors analyze financial documents to identify errors and find evidence of fraud.
- The career path requires a bachelor's degree and strong math and reasoning skills.
- Professional certifications can help auditors increase their earning potential.
Most people have heard of accountants. But what is an auditor? And what does an auditor do differently from an accountant? Like accountants, auditors work closely with financial documents. Auditors review these documents to find errors and advise clients to correct them. Some specialize in fraud detection.
The career path requires a bachelor's degree in accounting, business, or a related field. Auditors also need strong analytical skills and an attention to detail. Our guide explains how to become an auditor, including a step-by-step route to career advancement.
What Does an Auditor Do?
Auditors analyze financial documents to identify errors, recommend new financial strategies, and investigate fraud. Within the auditing field, professionals work as internal and external auditors. Internal auditors review financial documents for their own company, while external auditors conduct audits on outside companies. Another type of auditor is a government auditor. Sometimes called IRS auditors in the U.S., these professionals work in external auditing for a federal or state government.
A bachelor's degree helps auditors launch their career. Some pursue specialized training with a graduate degree. Accountants and business professionals looking for a career change may find auditing a good fit. Auditors earn a median salary of $77,250, according to May 2021 data from the Bureau of Labor Statistics (BLS).
- Evaluate an organization's financial documents to identify errors.
- Research the revenue sources, accounting procedures, and risk management for an external organization.
- Conduct regular audits to identify process improvements and ways to cut waste and reduce financial risks.
- Review financial documents to make sure they comply with laws and regulations about financial reporting.
- Create written reports that summarize the findings of an external or internal audit.
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What Are the Steps to Become an Auditor?
At minimum, auditors need a bachelor's degree. While the process to become an auditor varies, many gain entry-level experience before pursuing more training or a graduate degree. This section walks through how to become an auditor.
Step 1: Earn a Bachelor's Degree in Accounting
Most auditors earn their bachelor's degree in accounting. Other common college majors include economics, finance bachelor's, and business administration.
During an undergraduate degree, auditors should take classes in financial accounting, auditing, and management accounting. Many programs also incorporate general business classes that emphasize analytical and decision-making skills.
Prospective auditors can also focus on their transferable soft skills and professional development. For example, strong communication and teamwork skills benefit auditors. In addition, pursuing an internship can help undergrads build a professional network.
In 2020-2021, full-time undergraduates at four-year institutions paid between $9,400-$37,600 in tuition and fees, according to the National Center for Education Statistics (NCES).
Step 2: Get an Entry-Level Auditing Job
With a bachelor's degree, auditors qualify for entry-level roles. Networking, attending career fairs, and completing an internship help college grads land a job. Recent graduates can also consider career bridge programs or job placement programs through their school.
Early career auditors report average salaries around $55,000-$57,000, according to August 2022 data from Payscale. Auditors can pursue a professional certification or master's degree to increase their earning potential.
Step 3: Earn Your Master of Accounting
A master's degree helps auditors gain advanced training and move into specialized roles. While auditors do not need a graduate degree, it can help professionals advance.
Most auditors pursue a master's in accounting with a specialization in auditing. Other options include a master's in economics or a master's in finance.
The cost of a master's degree varies widely, as does earning potential with the degree. Before taking on grad school debt, weigh the total cost of the degree against the earning potential to calculate your return on investment. Auditors with a master's degree in accounting report average salaries of $70,000 per year, according to August 2022 data from Payscale.
Step 4: Get a Job as an Auditor
Gaining professional experience may help auditors take on greater responsibilities and boost their earning potential. With around five years of experience, auditors can see their salaries increase by around $12,000 compared to starting salaries, according to Payscale data from August 2022. Top earners report salaries around $85,000.
With experience and continued education, auditors can also move into specialized fields like:
- Government auditing
- Healthcare auditing
- Insurance auditing
- Higher education auditing
- Corporate auditing
Step 5: Consider Continuing Education or a Specialization
Auditors can add to their skillset by pursuing continuing education or earning a professional certification. These options help auditors stay current in their field and adapt to changing technologies and methods. Other options include a graduate certificate in finance or a doctorate in accounting.
While auditors do not need licenses or certifications to practice, voluntary professional certifications showcase their skills and may help auditors move into specialized roles.
Licensing and Certification
Auditors generally do not need a license to practice. But those with several years of experience may need a CPA license to file financials with the U.S. Securities and Exchange Commission. Auditors can also pursue voluntary certifications to demonstrate their expertise. Several professional associations offer certifications. The Institute of Internal Auditors offers many certifications for auditors, including the certified internal auditor credential.
Common auditor certifications include:
- Certified public accountant
- Certified internal auditor
- Certified financial services auditor
- Certified fraud examiner
- Certified government auditing professional
The requirements for a professional certification vary. However, most certifications require a degree from an accredited college or university and auditor experience. Candidates must also pass a certification exam to demonstrate their knowledge. Certification can help auditors move into new roles and increase their earning potential.
What to Know Before Becoming an Auditor
Prospective auditors should always choose an accredited college. Accredited schools meet high standards for academic quality. These schools, including accredited online schools, must surpass independent standards for student learning outcomes, faculty qualifications, and academic mission. Students at an accredited school also qualify for more forms of financial aid.
According to NCES data, the average cost of tuition at a four-year university ranges from $9,375-$35,852, depending on the school type. Many students lower costs by choosing online programs and pursuing financial aid. Prospective students must also factor in additional expenses like books, supplies, and living costs. Hidden college costs, like transportation, also add to the total.
Auditors and accountants reported a median pay of $77,250 per year in May 2021, according to the BLS. Salaries vary by job title, experience, and location. Entry-level and lower-paying positions report salaries of around $47,000, while the highest-paid auditors and accountants report salaries of over $128,000.
Frequently Asked Questions About Becoming an Auditor
What qualifications do you need to become an auditor?
Auditors need a bachelor's degree to qualify for entry-level roles. Most auditors earn their bachelor's degree in accounting since colleges generally do not offer an auditing degree. Auditors can also pursue a bachelor's in business, finance, or a related field. While in college, students can gain hands-on experience through an accounting or auditing internship. An internship also helps prospective auditors expand their professional network.
After gaining entry-level experience, auditors can move into specialized roles. A graduate degree or professional certification can help auditors advance in their careers.
What is the fastest way to become an auditor?
Auditors must hold a bachelor's degree for entry-level jobs. As a result, the fastest way to become an auditor is to earn a college degree.
Earning a bachelor's degree generally takes four years for full-time students, but accelerated degree programs can shorten this timeline. Most auditors earn a bachelor's degree in accounting. These programs incorporate coursework in auditing methods and accounting systems.
Undergraduates also hone in-demand skills like critical thinking and teamwork during their degree. Those with a bachelor's degree in another field can consider a graduate certificate in auditing or accounting to gain the skills necessary for auditor jobs.
What is the difference between an auditor and an accountant?
Auditors and accountants both work with financial documents. However, while accountants create financial documents, auditors focus on reviewing those documents. For example, accountants who specialize as CPAs might create tax returns or business disclosure statements. Auditors then review these documents to find errors.
Some auditors work internally, reviewing financial documents within their organization. Others work as external auditors, identifying cases of fraud or financial malfeasance. While the job duties of an accountant and auditor overlap, and their skill sets are very similar, the roles represent two distinct career paths within the broader business and finance sector.
Can I become an auditor with an online degree?
Yes, you can become an auditor with an online degree. Many accredited colleges offer online degrees in business. Students can pursue their accounting degree online to gain specialized training for auditing careers.
During an online accounting degree, students take classes in forensic accounting, tax return auditing, and fraud examination. These courses prepare graduates for careers as an auditor. In addition, auditors can pursue further education, such as an online graduate certificate or an online master's program. Those interested in leadership roles can also consider an online MBA with a concentration in accounting.
How much money can I make as an auditor?
Accountants and auditors who worked in finance and insurance made an annual median salary of $79,310 in May 2021, according to BLS data. Those working for the management of companies made a median of $78,540 per year, while those employed by the government earned a median annual salary of $77,290 in 2021. As auditors gain experience, they generally earn higher salaries. The highest-paid accountants and auditors earned over $128,000 per year in May 2021.
Location also plays a role in earning potential. The best-paying states for auditors include New York, New Jersey, and California, as per the BLS. In New York, average yearly salaries exceed $100,000. Other high-paying states for auditors include Massachusetts and Washington.