What is the role of financial auditors in businesses?

Financial auditors are professionals who specialise in examining financial records to make sure that these are accurate. They lend their expertise to businesses to ensure full and timely compliance with tax regulations. Financial auditors also help provide insight into the financial status and liquidity of a company, particularly for the benefit of investors, shareholders, and owners.

Auditors gather relevant financial documents, which they will evaluate and check for accuracy and compliance. After a thorough examination of the documents, auditors summarize their findings in a written report. The report will then be presented by the auditors to key senior management members and administrative staff, or to potential clients or investors.

In addition to the duties mentioned above, the responsibilities of financial auditors, in Dubai for example, also include:

  • Computing taxes and preparing tax return documentation, if applicable
  • Scrutinizing financial ledgers, accounting books, and accounting systems to determine efficiency and preciseness
  • Organizing and maintaining financial data and records
  • Recommending feasible solutions to minimise risk, cut down costs, boost revenues and profits
  • Evaluating financial processes and making recommendations to improve efficiency and accuracy and align these with global best-practices

There are four general types of financial auditors:

  • Public auditors – These auditors provide accounting services and tax consultancy to businesses, government organisations, and individuals. Their field of expertise is evaluating financial records that should be disclosed to the public, as required by law.
  • Forensic auditors – Forensic auditors specialise in identifying and investigating illegal activities. As such, most forensic auditors collaborate with lawyers and law enforcement officers. They use their knowledge of finance law and accounting to examine financial data of government organisations, corporations, and even private businesses and individuals.
  • Internal auditors – Audit firms usually have a team of internal auditors whose forte is to eliminate opportunities for committing fraud. They ensure the funds of an organisation are managed properly and financial risks and expenditures are kept to a minimum.
  • External auditors – These professional auditors are usually part of third-party organisations that are not related to the concerned business or organisation. They are entrusted with the important task of providing an objective and independent audit report.
  • IT auditors – This is a branch of auditing dedicated to analysing the internal controls of organisations to determine that financial data is transmitted only to and from trustworthy sources. IT auditors assess the complete technological infrastructure of an organisation, as well as its policies and operations. They help set up measures for safeguarding corporate assets and protecting data integrity, especially financial information.