How to Become an Internal Auditor (Guardian of the Grains)
If you’ve ever aspired to play a pivotal role in managing a company’s finances or wondered what it takes to become an internal auditor, you’ve come to the right place.
In this guide, we’ll break down the SPECIFIC steps you need to take to embark on your career as an internal auditor. We’ll discuss:
- The skills you require.
- The education that can boost your prospects.
- How to secure a job as an internal auditor.
So, whether you’re a finance novice or an experienced professional looking to level up, stay with us.
We’re about to expose the blueprint to become an internal auditor.
Let’s dive in!
Steps to Become an Internal Auditor
Step 1: Gain an Understanding of the Field
Before you start your journey to become an internal auditor, it’s crucial to understand what the job entails.
Internal auditors are responsible for overseeing an organization’s operations, ensuring compliance with laws and regulations, and evaluating risk management strategies.
They are required to analyse and assess the effectiveness of control measures and identify areas where improvement is needed.
To gain an understanding of the field, you can take introductory courses on auditing, accounting, or finance, which will provide you with the fundamental knowledge required for this role.
You can also seek internships or part-time jobs in related fields to gain practical experience.
In addition to education, you should also familiarise yourself with the ethical standards and professional conduct required in the auditing industry.
The Institute of Internal Auditors (IIA) provides a wealth of resources and standards that are globally recognized.
Remember, this profession involves constant learning and staying updated with the ever-changing rules and regulations.
Therefore, developing an attitude of lifelong learning and an interest in understanding how businesses operate will serve you well in this field.
Step 2: Pursue Relevant Education
To establish a career as an internal auditor, it’s essential to have a strong educational foundation in business, finance or a related field.
A bachelor’s degree is the minimum requirement for most internal auditor positions.
Degrees in accounting, finance, business administration, or economics are usually the most relevant.
These programs provide a foundational understanding of business operations, financial principles, risk management, and legal regulations, all of which are crucial to the internal auditing profession.
During your undergraduate studies, consider taking courses in statistics, business law, financial accounting, managerial accounting, and business ethics as these subjects are integral to the role of an internal auditor.
After obtaining a bachelor’s degree, you may consider furthering your education with a master’s degree in business administration (MBA) or accounting.
While not always required, advanced degrees can enhance your credibility, deepen your knowledge, and potentially open up more job opportunities.
Some internal auditors may even opt to pursue a doctorate degree if they aim to work in academia or high-level consulting.
In addition, many schools offer internships or cooperative education opportunities that can provide valuable real-world experience and networking opportunities.
Be sure to leverage these opportunities to gain hands-on experience and make valuable industry connections.
Step 3: Acquire Necessary Certifications
Obtaining relevant certifications can significantly improve your chances of securing a role as an internal auditor.
These certifications not only augment your resume, but they also demonstrate your commitment, dedication, and specialized knowledge in the field of internal auditing.
One of the most common and sought-after certifications for an internal auditor is the Certified Internal Auditor (CIA) certification, offered by The Institute of Internal Auditors (IIA).
This certification is globally recognized and provides you with the necessary skills and knowledge to excel in your role.
You may also want to consider the Certified Public Accountant (CPA) or Certified Management Accountant (CMA) certifications, which can further broaden your skillset.
Additionally, if you’re interested in specializing in IT auditing, the Certified Information Systems Auditor (CISA) certification is highly recommended.
This certification is globally recognized and respected, and can significantly boost your career prospects.
To qualify for these certifications, you usually need a bachelor’s degree and some years of work experience in the field, although the specific requirements can vary.
Once you meet the eligibility criteria, you’ll need to pass a comprehensive examination to earn the certification.
Keep in mind that maintaining these certifications typically requires ongoing education and professional development to stay updated with the latest industry trends and standards.
Step 4: Develop Key Skills
As an aspiring Internal Auditor, it is vital to develop key skills that will enable you to perform your job efficiently.
These skills include analysis, communication, attention to detail, and understanding of auditing standards and regulations.
Analysis: Being an Internal Auditor involves scrutinizing the financial records of an organization.
You must be proficient in analyzing data, identifying trends, and understanding the implications of various financial decisions.
This requires strong mathematical and analytical skills.
Communication: An Internal Auditor must have excellent written and verbal communication skills.
You will need to explain complex financial information clearly to individuals who may not have a background in finance.
You may also need to write detailed reports and present your findings to management or a board of directors.
Attention to Detail: Given the sensitive nature of this role, having a keen eye for detail is paramount.
You must be able to spot errors, discrepancies, or potential signs of fraud in financial records.
Understanding of Auditing Standards and Regulations: You must be familiar with the standards and regulations that govern the auditing process.
This includes understanding the Generally Accepted Auditing Standards (GAAS), Sarbanes-Oxley Act, and other relevant laws and regulations.
It is also beneficial to develop skills in using auditing software and other technology relevant to the field.
You can develop these skills through your education, on-the-job training, or by taking additional courses or certifications.
Step 5: Gain Practical Experience
As an aspiring Internal Auditor, gaining practical experience in the field is an essential step.
This is where you apply your theoretical knowledge from your academic background in a real-world context.
Many employers prefer candidates who have had at least two years of experience in auditing, accounting or a related field.
Working in a lower-level auditing or accounting position can provide you with the needed experience.
You may also choose to work as an intern in an auditing firm while you are still studying.
This can give you a hands-on learning experience and a valuable insight into the industry.
During this period, focus on mastering auditing techniques, building understanding of various industry regulations and standards, and developing strong analytical and communication skills.
You should also pay attention to detail, as this is a key requirement for an Internal Auditor.
Some auditors may also choose to gain experience in a specific sector like finance, healthcare or manufacturing, which they plan to specialize in.
This industry-specific experience can make you more attractive to employers within that sector, as it gives you a deeper understanding of the operational intricacies and unique challenges they face.
Remember, the more practical experience you gain, the better equipped you will be to handle the demanding role of an Internal Auditor.
This experience will also prepare you for potential professional certification exams, such as the Certified Internal Auditor (CIA) designation.
Step 6: Network with Professionals
Networking is an essential step in pursuing a career as an Internal Auditor.
This process allows you to interact with other professionals in the field, learn from their experiences, and possibly gain leads for job opportunities.
You can network through attending industry conferences, joining professional organizations, or participating in online forums and social media groups dedicated to auditing or accounting.
Professional organizations, such as The Institute of Internal Auditors (IIA), can be particularly beneficial as they often provide resources like training, certification support, and job boards.
Attending events organized by these institutions can provide you the chance to meet and learn from experienced auditors.
Furthermore, consider connecting with former classmates, professors, and internship colleagues who might be working in the field.
They can provide valuable insights into the profession and may even provide referrals for job openings.
Remember, networking is not just about taking – it’s about building mutually beneficial relationships.
So, while you gain insights and opportunities from your network, also think about how you can contribute to others.
This might be sharing your own experiences, providing support to those newer to the field, or connecting people in your network with each other.
In the long term, a well-established network can serve as a powerful tool in your career progression as an Internal Auditor.
Step 7: Join Professional Organizations
Joining professional organizations can significantly enhance your career as an internal auditor.
These organizations provide networking opportunities, educational programs, certifications, and resources that can help you stay updated with industry trends and advancements.
One of the most well-known organizations is the Institute of Internal Auditors (IIA), which provides the Certified Internal Auditor (CIA) certification, a globally recognized credential for internal auditors.
The IIA also offers a wealth of resources, including research studies, guidance, and best practices to help you enhance your skills and expertise.
Besides IIA, there are other professional organizations such as the American Institute of Certified Public Accountants (AICPA), the Association of Certified Fraud Examiners (ACFE), and the Information Systems Audit and Control Association (ISACA) which can be beneficial, depending on your area of focus.
By becoming a member of professional organizations, you will also have the chance to connect with peers and industry experts, gaining insights from their experiences and building relationships that can benefit your career.
Furthermore, many of these organizations hold conferences and seminars, providing opportunities for continuous learning and professional development.
Joining professional organizations not only solidifies your dedication to the field but can also increase your visibility to potential employers, who often prefer candidates with professional affiliations and active participation in the industry.
Step 8: Seek Entry-Level Opportunities
After obtaining your necessary qualifications and certifications, begin searching for entry-level internal auditor positions.
These jobs often require no work experience and can be an excellent stepping-stone for your career.
Companies across various industries, including finance, healthcare, technology, and more, hire internal auditors to ensure their processes are compliant and efficient.
When applying for these roles, highlight any relevant coursework, internships, or projects you’ve completed during your education.
Tailor your resume and cover letter to each position, emphasizing your analytical skills, attention to detail, and knowledge of auditing standards and procedures.
In your early roles, focus on gaining as much experience as possible.
You’ll likely be assisting senior auditors, learning the ropes, and understanding the day-to-day responsibilities and challenges of the job.
Show initiative, ask for feedback, and take every opportunity to learn and grow in your role.
After gaining some experience, you may start to take on more responsibility and work on more complex audits.
This experience will be invaluable as you progress in your career and seek more advanced roles.
Step 9: Pursue Continuous Learning
In the ever-evolving field of internal auditing, it is crucial to stay updated with the latest industry standards, rules, and regulations.
You can do this by pursuing continuous learning, either through participating in professional development courses, attending industry-specific seminars and conferences, or subscribing to relevant publications.
You may want to consider earning additional certifications in specific areas of auditing or industry-specific certifications like the Certified Information Systems Auditor (CISA) or the Certified Fraud Examiner (CFE).
These certifications can not only enhance your skills but also make you more desirable to potential employers.
As an internal auditor, it is also beneficial to have a strong understanding of the business or industry in which you work.
Therefore, you may want to take business or finance courses or even pursue a Master’s degree in Business Administration (MBA).
Online courses, webinars, and podcasts related to internal auditing or your industry can also be great resources for continuous learning.
Remember, the more you know about the field, the better equipped you will be to provide value and insights to your employer.
Continuous learning is key to staying competitive and relevant in the internal auditing profession.
Step 10: Advance Your Career in Internal Auditing
To progress in your career as an internal auditor, you may consider pursuing advanced certifications or qualifications such as the Certified Internal Auditor (CIA), Certified Fraud Examiner (CFE), Certified Information Systems Auditor (CISA), or the Certified Public Accountant (CPA) designation.
These can improve your skills, validate your expertise and increase your employability.
Another key aspect of advancing your career is gaining experience in different industries and domains.
The more diverse your experience, the more valuable you become as an internal auditor.
You can gain this experience by seeking out new challenges and responsibilities in your current job, changing companies or industries, or even by offering your services on a consultancy basis.
Networking is also essential in advancing your career.
Attend industry events, join professional organizations, and connect with other internal auditors and professionals in your industry.
This can help you learn about new developments, job opportunities, and gain valuable advice from others.
Lastly, seek out leadership and management roles as you gain more experience.
Leading teams, managing audits, or overseeing a department can demonstrate your ability to handle more responsibility and can lead to higher positions such as Chief Audit Executive or Director of Internal Audit.
Remember, the goal is not just to advance, but to continuously learn and adapt in the ever-evolving field of internal auditing.
Internal Auditor Roles and Responsibilities
Internal Auditors are responsible for overseeing the functioning and efficiency of an organization’s internal controls, corporate governance, and risk management.
They ensure compliance with laws, regulations and company policies, and assist in business process improvement.
They have the following roles and responsibilities:
Internal Audit Planning
- Develop an annual audit plan using an appropriate risk-based methodology.
- Plan and allocate resources necessary for conducting audits.
- Identify areas of risk within the organization.
Conducting Audits
- Conduct financial, operational, and compliance audits.
- Examine and evaluate the organization’s financial and information systems, management procedures, and internal controls.
- Perform testing of identified areas and report on any errors or discrepancies found.
Reporting
- Prepare and present reports that reflect the audit results and document the proposed corrective actions.
- Communicate audit findings to senior management and draft comprehensive and complete reports of audit areas.
Advisory Role
- Advise management on how to improve systems and processes.
- Provide advice on proposed new systems, acquisitions and other major changes to ensure key risks are considered.
Compliance
- Ensure compliance with all applicable directives and regulations.
- Verify that the organization’s internal controls and compliance procedures are functioning effectively.
Continuous Improvement
- Recommend improvements to the effectiveness of risk management processes and control activities.
- Identify and communicate areas for improvement, providing solutions for weaknesses in internal control.
Follow-up Audits
- Perform follow-up audits to monitor management’s interventions.
- Ensure that the agreed actions to manage and mitigate risks have been implemented.
Professional Development
- Keep abreast of developments in audit procedures and regulations by attending conferences, workshops, and continuing education seminars.
- Maintain professional and technical knowledge by attending educational workshops, reviewing professional publications, and participating in professional societies.
Interdepartmental Collaboration
- Work with managers across the business to understand their needs and ensure the audit process is smooth and beneficial.
- Collaborate with external auditors to ensure successful audit results and compliance.
Ethics and Confidentiality
- Adhere to the highest degree of professional standards and strict client confidentiality.
- Maintain independence and objectivity in all auditing processes.
What Does an Internal Auditor Do?
Internal Auditors are vital professionals in the corporate field, typically working for businesses across all industries.
Their primary role is to provide an independent assurance that an organization’s risk management, governance, and internal control processes are operating effectively.
They conduct financial, operational, and compliance audits to assess the effectiveness and efficiency of the control environment.
This involves reviewing the accuracy of financial records, transactions, and procedures to ensure that resources are being used efficiently and effectively.
They are also responsible for identifying areas where processes or policies may not be in line with laws and regulations.
They recommend improvements or changes in procedures and systems to reduce risk, increase operational efficiency, and ensure compliance with government regulations.
In addition, they prepare and present reports that reflect audit results and document the process.
These professionals often communicate with management and operational teams about the findings and provide recommendations to address identified issues.
Internal Auditors play a significant role in maintaining transparency and accountability within an organization, assisting in the prevention of fraud and financial mismanagement.
They are essential in ensuring that a company’s operations are run effectively, efficiently, and within the boundaries of law and policy.
Essential Internal Auditor Skills
- Communication: An internal auditor must be able to relay complex information in a clear, understandable manner to various stakeholders. This involves written and verbal communication skills, as well as the ability to listen effectively.
- Detail-oriented: The role involves meticulous examination of financial statements and records. An eye for detail is crucial to identify discrepancies, inconsistencies, or potential issues.
- Analytical Skills: Internal auditors must analyze data, documents, and processes to assess the effectiveness of risk management practices. This involves strong critical thinking and problem-solving abilities.
- Audit Reporting: The ability to create detailed, clear and accurate audit reports is essential. These reports should communicate the results of audits, providing valuable insights for management.
- Knowledge of Auditing Standards: Familiarity with the International Standards for the Professional Practice of Internal Auditing and other relevant regulations is crucial. Auditors should be aware of the latest changes and updates.
- Accounting Skills: A solid background in accounting is needed as internal auditors review financial records and statements to ensure their accuracy and legality.
- Risk Assessment: The ability to identify and assess potential risks is key. Auditors should understand how to evaluate the severity of risks and recommend appropriate mitigation strategies.
- Integrity: Internal auditors should possess a high degree of integrity, as they are responsible for ensuring compliance with laws and regulations, and detecting fraud or misconduct.
- Information Technology: As many auditing processes are now digitized, auditors should be comfortable using auditing software and be aware of IT risks and controls.
- Project Management: Managing multiple audits simultaneously requires excellent project management skills. This includes time management, task prioritization, and coordinating resources effectively.
- Business Acumen: An understanding of the organization’s business model, industry, and market trends is helpful in identifying potential areas of risk or non-compliance.
- Interpersonal Skills: Dealing with different departments and levels of management requires good interpersonal skills. Internal auditors should be able to build relationships and work collaboratively.
- Continuous Learning: The regulatory and business landscape is constantly changing. Thus, auditors should be committed to continuous learning and professional development.
- Confidentiality: Due to the sensitive nature of the information handled, auditors should be able to maintain confidentiality at all times.
- Decision Making: Internal auditors need to make decisions about the adequacy of controls, the risk of fraud, and the effectiveness of operations. This requires solid decision-making skills based on evidence and best practices.
Internal Auditor Career Path Progression
The Foundation: Junior Internal Auditor
Your journey typically begins as a Junior Internal Auditor.
In this stage, your primary responsibilities would be assisting in executing individual audits, learning the processes, and understanding the company’s internal control systems.
Here are some tips for success in this role:
- Continuous Learning: Understand the company’s policies and procedures, as well as industry standards and best practices.
- Communication: Develop strong communication skills, both written and verbal, as you’ll need to present your findings and interact with various departments.
- Attention to Detail: Audit work requires meticulous attention to detail, so start developing this skill early.
The Ascent: Internal Auditor
After gaining some experience and understanding of the field, you’ll transition into the role of an Internal Auditor.
At this stage, you’ll perform full audits independently, identify potential risk areas, and make recommendations for improvements.
Here’s how to thrive in this stage:
- Problem Solving: Develop your analytical skills to identify patterns, anomalies, and areas of risk within the company.
- Interpersonal Skills: Cultivate strong relationships across different departments to ensure smooth audit processes.
- Ethics: Uphold the highest ethical standards as you’ll be dealing with sensitive information.
Reaching New Heights: Senior Internal Auditor
The next step in your career path is the Senior Internal Auditor position.
At this stage, you’ll be recognized for your expertise and may supervise audit teams, develop audit plans, and work on strategic initiatives.
To excel as a Senior Internal Auditor:
- Mentorship: Share your knowledge and experience with junior auditors, helping them to grow professionally.
- Strategic Thinking: Look beyond individual audits and consider how your work impacts the company as a whole.
- Leadership: Demonstrate leadership skills in managing audit teams and projects, inspiring others with your work ethic and commitment to excellence.
Beyond the Horizon: Audit Manager and Beyond
As you continue to grow, you may become an Audit Manager or even Chief Audit Executive.
These roles involve managing larger teams, setting audit strategies, and interacting with top management.
Here’s what to focus on:
- Management Skills: Strengthen your leadership, decision-making, and project management skills to guide your team effectively.
- Strategic Vision: Develop a strategic vision for the audit function that aligns with the company’s objectives.
- Influence: Build strong relationships with senior leadership to influence decision-making and drive change.
Pinnacle of Success: Chief Audit Executive
Reaching the role of Chief Audit Executive means you’re at the pinnacle of the Internal Audit career ladder.
Here, you’ll be responsible for setting the overall strategy for the audit function, ensuring compliance with laws and regulations, and advising the board and senior management on risk management.
Internal Auditor Salary
Entry-Level Internal Auditor
- Median Salary: $50,000 – $70,000 per year
- Entry-level internal auditors typically have 0-2 years of experience and may hold bachelor’s degrees in accounting, business administration or related fields.
Mid-Level Internal Auditor
- Median Salary: $70,000 – $90,000 per year
- Mid-level internal auditors have 2-5 years of experience and often take on more complex auditing tasks and responsibilities.
Senior Internal Auditor
- Median Salary: $90,000 – $120,000 per year
- Senior internal auditors possess 5+ years of experience and are responsible for leading audit projects, making risk assessments, and mentoring junior auditors.
Audit Manager / Internal Audit Manager
- Median Salary: $100,000 – $130,000+ per year
- These roles require significant experience and often involve overseeing the internal audit department, planning and managing audits, and making key strategic decisions.
Chief Audit Executive / VP of Internal Audit
- Median Salary: $130,000 – $200,000+ per year
- These high-level positions require extensive experience and deep understanding of auditing standards and regulations. They involve setting audit strategies for a company and making crucial decisions related to risk management.
Internal Auditor Work Environment
Internal Auditors typically work in an office environment within a wide range of industries such as finance, healthcare, manufacturing, and government entities.
They often work full-time during regular business hours, although longer hours may be required during peak auditing periods.
Internal Auditors spend a significant amount of time analyzing data and reviewing processes, so they frequently work on computers and utilize various software programs.
They also conduct interviews and meetings with various department heads and employees to gather information or discuss findings.
Internal Auditors may also be required to travel to different branches of an organization or different sites of operation.
With advancements in technology, a growing number of auditors are now able to perform many of their duties remotely.
The job of an Internal Auditor requires a high level of precision, a strict adherence to regulations and laws, and a commitment to maintaining confidentiality.
The work can be stressful, particularly when dealing with resistance to audit findings or when trying to meet tight deadlines.
With experience and additional certification, Internal Auditors can move into higher management roles or choose to become independent consultants.
FAQs About Becoming an Internal Auditor
What is needed to become an internal auditor?
To become an internal auditor, you typically need a bachelor’s degree in accounting, finance, or a related field.
Some employers may prefer candidates with a master’s degree or an additional certification such as Certified Internal Auditor (CIA) or Certified Public Accountant (CPA).
Key skills include financial and business acumen, analytical thinking, attention to detail, and excellent communication abilities.
Knowledge of auditing standards and familiarity with accounting software and systems is also essential.
How long does it take to be an internal auditor?
The time it takes to become an internal auditor can vary depending on your educational path and experience level.
If you pursue a traditional bachelor’s degree in accounting or finance, it typically takes four years.
After graduation, you might need to gain 1 to 3 years of work experience in an auditing or accounting role before transitioning into an internal auditor position.
If you choose to pursue further certifications like CIA or CPA, it might take additional time to prepare for and pass the exams.
Can I be an internal auditor without a degree?
While it may be technically possible to become an internal auditor without a traditional four-year degree, it’s generally more challenging as most employers prefer candidates with at least a bachelor’s degree in accounting or finance.
Practical experience in finance, accounting or a related field is crucial.
However, if you have extensive experience in these areas, some employers might consider you for an internal auditor role.
Professional certifications like the CIA or CPA can also enhance your qualifications.
Is internal auditing a stressful job?
Internal auditing can be stressful at times, as it often involves tight deadlines, meticulous review of financial records, and dealing with complex financial regulations and systems.
The level of stress can vary depending on the company, the specific role, and the individual’s ability to manage stress and workload.
However, many internal auditors find the job rewarding because it plays a crucial role in ensuring a company’s financial integrity and compliance.
What are the prospects for internal auditors in the next decade?
The job outlook for internal auditors is promising.
As businesses continue to face growing regulatory complexity and need to ensure compliance, the demand for skilled internal auditors is expected to remain strong.
Additionally, the increasing emphasis on risk management and corporate governance is likely to provide ample growth opportunities for internal auditors in the coming years.
Conclusion
And there you have it.
Embarking on the journey to become an internal auditor is no easy task, but it’s undoubtedly enriching.
Equipped with the right skills, education, and perseverance, you’re well on your way to making a significant contribution in the corporate world.
Remember, the path may be tough, but the opportunities are vast. Your expertise could lead to the next crucial insight that improves business efficiency, compliance, and profitability.
So, take that first leap. Immerse yourself in learning. Connect with industry professionals. And most importantly, never stop honing your analytical abilities.
Because the corporate world is waiting for the value you can add.
And if you’re looking for personalized guidance on starting or advancing your career in internal auditing, explore our AI Career Path Advisor.
This complimentary tool is designed to provide customized advice and resources to help you navigate your career path effectively.
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