Independent auditors, who have no affiliation with the company being audited, are preferred to ensure audit integrity. They must have an accounting certification and provide an unbiased opinion. Conflicts of interest are avoided, and professional organizations can provide referrals.
An independent auditor is a person with an accounting credential who has no affiliation with the company on which he or she provides an opinion. Independent auditors are often used for audits to increase audit integrity by ensuring that conflicts of interest do not taint the audit. Some accounts focus their careers on providing audit services, while others may offer a variety of accounting services including audits. People who need to find an independent auditor can check with a certifying or professional organization for accountants to find listings of professionals in their area.
When an audit is performed, the objective is an honest examination of financial records, whether the audit is being performed to resolve discrepancies, investigate fraud, verify compliance with recognized and standard accounting practices, or for the purpose of determining whether the company you are reporting financial information accurately on taxes. Companies can request audits themselves and an audit can also be ordered by an external party. While it is possible to use an auditor affiliated with the company being audited, an independent auditor is preferred.
The independent auditor must have an accounting certification and is often a certified public accountant (CPA) with experience in the field, making the accountant competent and able to offer an opinion. Many independent auditors belong to professional auditing organizations that promote high performance standards among their members and provide referrals to members of the public in need of an auditor.
Independent auditors have no interest in the outcome of an audit in any way. Whether the audit reveals irregularities or a clean statement of financial health, the auditor is not personally involved because he has no connection to the company. Therefore, the auditor can write a clear and unbiased accounting statement accompanying the audit results, describing the findings and discussing their ramifications.
Auditors who are not independent may have conflicts of interest. An auditor may be concerned, for example, with the value of the shares, the future direction of the company, or future employment prospects if he is connected with the company in any way. While auditors have very high ethical standards that should allow even a connected auditor to provide an honest report, conflicts of interest can undermine the authority of the report and are, if possible, avoided by using an independent auditor.
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