Internal auditor

Definition

An internal auditor is a professional employed by an organization to assess its internal controls, risk management, and governance processes. They help ensure the accuracy of financial reporting and compliance with laws and regulations.

5 Must Know Facts For Your Next Test

1. Internal auditors evaluate the effectiveness of internal controls designed to prevent fraud.
2. They provide recommendations for improving processes and mitigating risks.
3. Internal auditors perform both financial and operational audits within an organization.
4. Their work is crucial for maintaining corporate governance and accountability.
5. They often collaborate with external auditors to provide a comprehensive audit perspective.

Review Questions

• What primary role does an internal auditor play within an organization?
• How do internal auditors contribute to fraud prevention?
• In what ways can internal auditors improve an organization's risk management?

Related terms

External Auditor: A third-party professional who independently evaluates an organization's financial statements for accuracy.

Internal Controls:

Mechanisms put in place by an organization to ensure the integrity of financial and accounting information.

Risk Management:

The process of identifying, assessing, and prioritizing risks followed by coordinated efforts to minimize their impact.