To Be or Not To Be an Internal Auditor?

By Arif Zaman , Head of Internal Audit, Emaar Industries & Investments, UAE

Why you should Not be an Auditor?

I usually state all the good attributes of my audit profession which I respect a lot. It’s in demand, the need of the time, and gives you great potential to learn and serve in a wider scope within an organization.

The audit assurance provides comfort to shareholders, investors, regulators, and the public alike on the reliability and transparency of this information provided by the management of the company’s performance.

Nevertheless, like all the professions, there are things which others need to know about the auditor’s challenges.

“Life is not always a bed of roses as an auditor, and I have encountered tricky situations dealing with officers of entities audited. I might not get the warmest reception, and there might be times when the officers are wary of us due to misconceptions about the nature of our work.” — Mr. Christopher Tang, Deputy Director, Singapore Auditor General Office (AGO)

The first and foremost point in the life of an auditor, they are mostly unwelcome within the organization due to their nature of work. It’s human nature that people do not like to be examined and being questioned for what they are responsible for, let alone to be reported on control deficiencies in their area of expertise to their line managers or higher authorities. As a result of such fear, auditors have to face challenges in discharging their duties.

“A myth is that we are out there to “get” people and write them up for not doing things correctly. Sometimes you find an audit issue where someone is not doing something correctly. But the goal is to find problems with internal controls that could adversely affect the organization and bring them to light. The goal is to help clients avoid adverse financial, operational, and regulatory compliance issues. The focus is to find the best path forward for a solution to a problem.” – Joseph McCafferty is Editor & Publisher of Internal Audit 360°

Some of the most common challenges auditor encounter are the following:

• The management does not cooperate with the auditors.
• The auditors are restricted to have access to information.
• Auditors are avoided, and they generally have a tough time building trust with their colleagues.
• Auditors sometimes receive threats.
• Auditors sometimes have less opportunity to grow within the organization.
• Auditors are conceived rude, rigid, and cold-hearted within the organization.
• Auditors are underpaid at times than their counterparts.
• Auditors’ performance is heavily dependent on multiple variables some time not under their controls.
• Auditors’ independence is compromised by reporting to management or asking to perform management work activities.
• Auditors are sometimes terminated or forced to leave (politically) due to the threat to expose wrongdoing.

These challenges should not deter one to pursue such an exciting career, but rather to equip ourselves to deal with such situations. In a professional career, you may or may not encounter these challenges. The most important thing is you should be aware of the challenges and know how to deal with the situation. 

In general, always try to put yourself in the other employee’s (auditee) shoes before taking a strong stance and deal with them with honor, dignity, and fairness irrespective of how they react to you.

Do not be a people pleaser, do your job honestly irrespective of consequence (You will be better off in the long run.), be humble, be firm without being dismissive or disrespectful to others.

There are shortcomings in the audit fraternity which need to be addressed as well. It is our responsibility that we set a good example by being ethical and professional in our behavior and attitude.

How Rewarding Internal Audit Career Is?

Now, the question arises, how rewarding is this career. The simple answer is “it varies like any other profession”.

Having said this, I personally see many compelling reasons such as the continuous and rising demand of this profession. Internal audit is also a statutory requirement in many parts of the world at least for publicly traded companies. Further, the global recession, corporate failures, banking crises, money laundering, corporate fraud, cyber-attacks, volatile market, and disruptive innovation, etc. all necessitate the need to have more internal auditors.

How to become an Auditor& Choose Internal Audit Career Route

I would recommend the following two approaches to enter in the internal audit profession i.e. entry level route and the experienced professional route.

Entry Level Route

Those who are still students and pursuing an academic or professional qualification route they might follow the following steps:

• In the past, internal audit professional was predominantly dominated by the accounting or business professional but now there is much awareness that students from another discipline graduates can also join this profession.
• I have encountered professionals like engineers, doctors, IT expert working as internal auditors. They have their niece market with limited demand but very specialized job opportunities.
• It is recommended to combine technical expertise with basic accounting or business knowledge gives an edge over other candidates in the job market.
• People pursuing accounting studies (CPA/ACCA/CA) can add CIA, CISA or CFE to increase their chances to enter in the internal audit profession.
• Lastly, a career with an accounting firm (as they specialized in a specific sector or industries and need accounting/business graduate along with with some other technical skills for specific sector/industry such as health care, telecommunication, petrochemical, industrial, etc.) will help to harness the skill sets in this profession.

Experienced Professional Route

• No matter which career you are, you can always obtain the basic audit/accounting/business knowledge before considering a career in internal audit.
• The reason I emphasize on the accounting/business knowledge because the market still lacks the awareness that internal auditor can be outside the realm of the accounting profession. So I don’t want new aspirant to be at a disadvantage while pursuing a career in internal audit.
• Those who already have an accounting/business qualification, I will recommend pursuing internal audit certification such as the CIA (widely accepted) to obtain a basic understanding of the role of internal auditors.
• Initially, once you have some theoretical background, try to move within your organization in the internal audit department either on a rotational basis or permanently.
• If in case your organization does not have internal audit department, it’s better to find a job role in your own field in any big size company which has internal audit department and gradually try to move internally within the internal audit department.
• On the other hand, if you are lucky, you might apply right away for the internal audit jobs but without prior experience, the chances are less.

Internal audit profession gives the flexibility to pursue other careers. The auditing skills can interchangeably be used to pursue other related professions with less effort such as Statutory (External) Audit, Information Security, Risk Management, Internal Control, Forensics (Fraud Investigation), Compliance last but not least the very obvious option Finance and Accounting.

 

Now the choice is yours, Do you want “To Be an Internal Auditor or Not To Be” ?