How to Become an Auditor? – A Detailed Guide
Auditors play a crucial role in ensuring the accuracy and integrity of financial statements and compliance with regulations. They also ensure the efficient use of resources within an organization. Learning how to become an auditor in India may prompt you to acquire certain skills and meet a few specific eligibility requirements. This comprehensive guide will walk you through each step of the process, providing valuable insights and the career opportunities available in this field.
Who is an Auditor? What Does an Auditor Do?
An auditor reviews financial documents, statements, data, and accounting entries to ensure accuracy. They gather information from the company’s financial statements, account balances, tax returns, balance sheets, and financial reporting systems. Auditors use these documents to research and find errors to identify fraudulent activities, if any. These professionals may either work as members of a company’s financial department or as independent contractors.
What are the Responsibilities of an Auditor?
Auditors undertake many other duties than keeping a record of the company’s financials. To understand how to become an auditor in India, let’s first explore some of the key responsibilities of an auditor:
- Prepare and audit balance sheets and income statements
- Keep a check on the company’s expenditure to improve organizational efficiency
- Stay updated with processes and regulations to ensure compliance with financial policies and regulations
- Conduct regular meetings with management and other stakeholders to convey financial findings
- Provide quantitative and qualitative evaluation based on empirical data insights
Steps to Become an Auditor in India
To learn how to become an auditor, you will have to go through a series of steps. We have outlined the steps in detail to help you navigate your path to a successful career as an auditor.
1. Obtain Educational Requirements, Skills, and Certifications Needed
To become an auditor, you will be required to obtain a certain set of eligibility requirements and skills. Fulfilling these requirements can help you successfully land a career in the field. We have discussed these requirements in detail below:
a) Undergraduate Degrees
The first step towards becoming an auditor is to obtain a relevant undergraduate degree. Degrees in commerce, accounting, finance, or business administration provide a solid foundation for a career in auditing. These programs typically cover essential subjects, such as types of financial modeling, financial accounting, auditing principles, taxation, and business law, equipping you with the fundamental knowledge required for auditing roles.
b) Professional Certifications
After completing your undergraduate degree, pursuing professional certifications can significantly enhance your chances of a successful career as an auditor. The most recognized certifications in India include:
- Chartered Accountant (CA) from the Institute of Chartered Accountants of India (ICAI)
- Certified Internal Auditor (CIA) from the Institute of Internal Auditors (IIA)
These certifications require passing a series of exams and fulfilling practical training requirements, demonstrating your expertise and commitment to the profession. You can opt for a financial modeling valuation course to increase your chances of passing these exams.
c) Postgraduate Degrees
While not mandatory, obtaining a postgraduate degree such as a Master of Commerce (M.Com) or a Master of Business Administration (MBA) with a specialization in finance or auditing can further enhance your qualifications. These advanced degrees provide deeper insights into complex financial and auditing concepts and can open doors to higher-level positions within the industry.
2. Gain Required Skills
If you wish to learn how to become an auditor, you must develop specific skills that are critical to the profession. These skills not only help in performing audit tasks efficiently but also enhance your overall effectiveness as an auditor. You should work on gaining the following skills to kickstart your career as an auditor:
a) Analytical Skills
Analytical skills and problem-solving skills are essential for auditors to assess financial statements, identify trends, and detect anomalies. These skills enable auditors to interpret complex data and make informed decisions based on their observations. You can hone your analytical abilities by practicing critical thinking and regularly conducting financial data analysis.
b) Attention to Detail
Attention to detail is vital for auditors to ensure the accuracy and completeness of financial records. Auditors must properly review documents and transactions to verify compliance with regulations and standards. Having a keen eye for detail can prevent errors and discrepancies, thereby, enhancing the reliability of audit reports.
c) Communication Skills
Effective communication is crucial for auditors to convey their observations and recommendations clearly to stakeholders. Auditors often need to explain complex financial information to individuals without an accounting background. You can hone your written and interpersonal communication skills by pursuing online courses.
d) Technical Proficiency
Auditors must be proficient in using various auditing tools and software, such as spreadsheets, accounting software, and audit management systems. Technical proficiency ensures that audits are conducted efficiently and accurately. Keeping up-to-date with the latest technological advancements and continually enhancing your technical skills can significantly improve your auditing capabilities.
It is important to have proficiency in Excel while working as an auditor. You can pursue an advanced Excel course to improve your technical skills as an auditor.
3. Pursue Internships
Gaining practical experience through internships is a vital step in becoming an auditor. Auditing internships provide hands-on experience in real-world auditing scenarios, allowing you to apply your theoretical knowledge.
They also offer an opportunity to learn from experienced professionals and understand the day-to-day responsibilities of an auditor. Many undergraduate and postgraduate programs offer internship placements, which can be a stepping stone to securing a full-time auditing position.
4. Apply for Auditor Positions
Once you have obtained the necessary education, certifications, skills, and practical experience, the next step is to apply for auditing jobs. Prepare a professional resume and highlight your qualifications and relevant experience. Practice thoroughly for interviews and learn how to demonstrate your expertise and passion for auditing. This will increase your chances of securing a position in this competitive field.
Types of Auditors in India
Now that you understand how to become an auditor in India let’s discuss the variety of specializations, each with its unique focus and responsibilities. Learning about the types of auditors and their responsibilities can help you choose a path that aligns with your interests and career goals. Here are some of the profiles for auditors in India:
1. Internal Auditors
Internal auditors work within an organization to assess its internal controls, risk management, and governance processes. They provide independent and objective evaluations of the effectiveness of these processes, helping the organization improve its operations and achieve its objectives. Internal auditors play a crucial role in identifying inefficiencies and recommending improvements.
2. External Auditors
External auditors are independent professionals who examine an organization’s financial statements to ensure their accuracy and compliance with accounting standards. They are typically employed by public accounting firms and are required to provide an unbiased opinion on the financial health of the organization. External auditors help maintain the trust of stakeholders, including investors and regulatory bodies.
3. Forensic Auditors
Forensic auditors specialize in investigating financial fraud and white-collar crimes. They use their auditing and accounting skills to uncover illegal activities and gather evidence for legal proceedings. Forensic auditors work closely with law enforcement agencies and legal professionals to ensure that financial crimes are thoroughly investigated and prosecuted.
4. IT Auditors
IT auditors focus on the information technology systems and processes within an organization. They assess the effectiveness and security of IT controls, ensuring that data is protected and systems are reliable. IT auditors play a vital role in protecting sensitive information and maintaining the integrity of the organization’s IT infrastructure.
Top Companies Recruiting for an Auditor
Every major private company requires an auditor to conduct a financial audit. Financial services and banking sectors along with the consultancy domain hire these professionals. If you are wondering how to become an auditor in India and looking for companies to apply to, here are some of the leading companies that recruit auditors:
- Ernst & Young
- Deloitte
- KPMG
- HDFC Bank
- Bajaj Finance Limited
- Mahindra & Mahindra Financial Services Limited
- Aditya Birla Finance Limited
- Tata Capital Financial Services Ltd.
- ICICI Banks
- Bank of America
Salary Trends for Auditors
The salary of an auditor in India depends on several factors including their experience level, whether they are working in government or private sector, location, companies, and more. However, the average salary of an auditor in India ranges from ₹4 LPA to ₹10 LPA. Let’s explore salaries for different types of auditors based on various experience levels:
| Job Role | Fresher Salary | Mid-Level Professional Salary | Experienced Professional Salary |
| Internal Auditor | ₹4 LPA – ₹12 LPA | ₹13 LPA – ₹15 LPA | ₹16 LPA – ₹18 LPA |
| External Auditor | ₹6 LPA – ₹11 LPA | ₹12 LPA – ₹16 LPA | ₹17 LPA – ₹23 LPA |
| Forensic Auditor | ₹5 LPA – ₹11 LPA | ₹12 LPA – ₹20 LPA | ₹21 LPA – ₹35 LPA |
| IT Auditor | ₹5 LPA – ₹13 LPA | ₹14 LPA – ₹17 LPA | ₹18 LPA – ₹23 LPA |
Conclusion
Auditors play a crucial role in ensuring the financial integrity and compliance of organizations, making it a highly respected and impactful profession. Learning how to become an auditor in India can enable you to gain specific qualifications and skills necessary to excel in the field. By following the steps outlined in this guide, you can build a strong foundation for a successful career in auditing. The opportunities that you will get in this field are vast and rewarding.
You can refer to the best ways to find internships and jobs as an auditor for a better chance of creating a great career in this field.
FAQs
Answer: Auditors should be proficient with accounting software (such as Tally, QuickBooks, and SAP), data analysis tools (like Excel and ACL), and audit management software (such as CaseWare and TeamMate). Familiarity with data visualization tools (like Tableau) and an understanding of IT systems and cybersecurity are also valuable.
Answer: The average salary range for auditors in India varies based on experience, qualifications, and location. Entry-level auditors can expect to earn between ₹3 LPA to ₹6 LPA, while experienced auditors with certifications can earn between ₹4 LPA to ₹10 LPA. Senior auditors and audit managers can earn significantly higher salaries.
Answer: Internships with accounting firms, financial institutions, or government audit agencies are particularly beneficial for aspiring auditors. These internships provide practical experience, exposure to real-world auditing processes, and the opportunity to work under the guidance of experienced professionals.
