Auditor

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Financial Terms and Glossary

Auditor

An auditor is a professional who examines and verifies financial statements to make sure they are accurate and follow legal requirements. Auditors can work inside a company (internal auditors) or outside (external auditors). They play a key role in ensuring that financial reports are trustworthy, which helps investors and regulators have confidence in the company’s financial health.

Example

An external auditor might be hired by a company to review its financial statements before they are shared with shareholders and regulators.

Key points

• Responsible for verifying the accuracy of financial statements.

• Can be an internal or external professional.

• Helps ensure financial transparency and compliance.

Quick Answers to Curious Questions

An internal auditor works within the company, while an external auditor is from an outside firm and provides an independent review.

They ensure that companies’ financial statements are accurate and reliable, which is crucial for maintaining investor confidence and regulatory compliance.

By thoroughly reviewing and verifying financial records, auditors help prevent errors and fraud, ensuring the company’s financial reports are trustworthy.