Back to: Auditing
Hello, students
We’ve learnt what auditing is and the different types of audits. Now, let’s talk about the people who carry out this auditing work – they are called auditors. Today we will learn about the different kinds of auditors and what they do.
Lesson Objectives:
By the end of this lesson, students should be able to:
Define who an auditor is.
Mention the major types of auditors.
Explain the role of each type of auditor.
Different Kinds of Auditors
Who is an Auditor?
An auditor is a person who checks financial records or operations to make sure they are correct, fair, and follow the rules. Auditors must be honest, careful, and skilled in accounting and finance.
Just like how a referee watches a football match to make sure players follow the rules, an auditor checks a company to ensure everything is being done properly.
Types of Auditors:
1. Internal Auditor
Works inside the organisation
Checks the company’s systems and processes
Helps to prevent problems before they happen
Reports to management
Example: The internal auditor of a school checks how school fees are collected and used.
2. External Auditor
Not part of the organisation
Independent and objective
Checks financial statements to give an audit opinion
Often required by law for companies
Example: A firm like KPMG auditing the annual accounts of a bank.
3. Government Auditor
Works for government audit agencies
Checks how public money is spent in ministries and parastatals
Makes sure government offices are not wasting or misusing money
Example: Office of the Auditor-General for the Federation checking the Federal Ministry of Health.
4. Forensic Auditor
Specialises in investigating fraud and financial crimes
Works with police or lawyers during cases
Very detailed and often used in court
Example: An auditor who investigates missing funds in a company or government office.
5. Independent Auditor
This is a general term for an external auditor who is not influenced by the organisation. They must be truly free from bias to give a fair report.
Classroom:
Lecturer: Let’s say the Lagos State Government suspects that money meant for road construction has been stolen. Which type of auditor should they call?
Student Response: Forensic auditor.
Lecturer: Correct! Because the matter involves possible fraud.
Summary of Lesson:
Auditors are people who examine records to make sure they are correct and legal. We have different types of auditors: internal auditors work inside, external auditors come from outside, government auditors check public offices, and forensic auditors handle serious fraud cases. Each one has a special job to do.
Evaluation:
Who is an auditor?
Mention and explain any three types of auditors.
Who checks the records of government ministries?
What kind of auditor is needed for fraud investigation?
What is the main difference between an internal and external auditor?
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