Business Audit and Your Career Scope
What exactly is a business audit? A business audit is basically an examination of your company’s financial documents, tax records, and account books. The objective is to make sure that the tax you paid is legitimate and check that the deductions you claimed are correct. If any part of the above is not correct then the Internal Revenue Service will be able to validate the discrepancy and make appropriate corrections to your accounting records.
What are the qualifications for being a qualified auditor? To be a qualified auditor, you need to be a certified public accountant. This means you have a four-year college degree in accounting or business administration. It is also necessary that you have the skills needed to understand the tax code, auditing records, reviewing financial statements, preparing reports, and so on. You must also pass the American Institute of Certified Public Accountants (AICPA) examination, which can be administered online. There are many online forums where you can ask questions about becoming an auditor.
Are there many different areas of business audits? Yes, there are several different areas of business audits including government side, internal auditing, and field audits. The government has specific requirements for qualifying for government contracts and grants; for qualifying for federal research grants; and for qualifying for bank loans.
Before you start a small business audit, it is important to first prepare all the necessary financial statements which includes an income statement, balance sheet, and statement of cash flows. You will also need to prepare the financial statement of the individual functional area such as operations, manufacturing, sales, and marketing. After completing these steps, you will be ready to conduct an internal or independent verification.
One of the key takeaway points for those who are considering on becoming certified public accountants (CPA) is that becoming certified would not automatically assure them of job openings in the field. In other words, it does not guarantee you the position you want. Business auditing can be both rewarding and extremely difficult.
To begin your career as a tax professional or CPA, it would be ideal to take at least one year off from work to enter the field. This is because it takes at least three years before a CPA can even open their own practice, much less run their own accounting firm. In addition, many small businesses do not take offs in their first few years of operation; having to restart your audit process after a year would be very difficult. Nevertheless, a small business audit or refresher course will greatly improve a CPA’s credentials and increase their employability.