Internal Auditors: Auditor employed by individual companies, partnership, Govt., agencies, individual and other entities are called internal auditors. They are employed by the organizations they audit. These auditors may review employee performance, compliance with company regulations and financial and accounting systems.
Functions: Internal auditors may conduct financial internal control, compliance operational and forensic audits within their organization. They in some cases may assist the external auditors with the annual financial statement audit. They also engaged in assurance and consulting for their entities.
- Verify the existence of assets and recommend proper safeguards for their protection;
- Evaluate the adequacy of the system of internal controls;
- Recommend improvements in controls;
- Assess compliance with policies and procedures and sound business practices;
- Assess compliance with state and federal laws and contractual obligations.
- Investigate reported occurrences of fraud, embezzlement, theft, waste, etc.
The auditor has a responsibility to plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement.