If you like the idea of examining and attesting to a company’s financial performance for a living, a career in auditing might be the right choice for you. To help you decide, we asked three auditors to talk about what a typical workday is like for them.
- An auditor’s workday gets crazy during tax season, from January through April.
- The job often entails working with several companies, meetings across internal departments, or both.
- If you like auditing but want some variety on the job, you might consider a career as a CPA.
Below is what a typical day looks like for an audit manager, a senior accountant, and an internal audit manager.
Audit manager Eric works for a regional accounting and consulting firm. The firm provides accounting and auditing services to clients throughout the U.S. and has clients with annual revenues ranging from several hundred thousand dollars to more than $100 million.
Eric is an audit manager in the firm’s hedge fund practice, so most of his 30-plus clients are hedge funds and other investment companies. Eric previously worked as an audit supervisor specializing in audits of nonprofit and healthcare companies at two other large accounting firms.
Eric arrives in the office around 9:00 am and begins his day reviewing email and organizing his priorities based on regulatory and client deadlines. After communicating with his clients to obtain any additional information he needs, he performs audit procedures. He delegates certain tasks to staff to ensure that the work is performed efficiently.
Hedge funds must be audited to comply with the Securities and Exchange Commission (SEC) and other agency regulations as well as to satisfy investors. The audit report provides an opinion that the fund’s financial statements are presented fairly in all material respects.
Eric learns about the valuation of the fund’s investments and performs tests on them. He also examines the fees the hedge fund manager charges its investors and compares that amount to the amount described in the fund’s organizational documents.
Eric participates in client meetings to discuss audit and tax work, industry happenings, and new accounting standards that are pertinent to the hedge fund industry and specifically to that client. The client updates Eric and his colleagues on the hedge fund’s performance and other business matters.
Eric also attends internal staff meetings to go over work status and discuss clients’ priorities. He has meetings with managers and partners to streamline internal processes and general documentation and to ensure that their audits are completed efficiently, effectively, and on time.
There are also frequent conference calls with potential hedge fund clients. The discussion focuses on the fund’s structure and trading strategy, and on what services the fund’s managers are looking for. Eric provides biographies of the firm and of the partner and manager who will be working on the job. They also discuss various aspects of the audit and negotiate the pricing.
Eric doesn’t have any issues getting time off for vacation as he gives ample notice and communicates his work status to his colleagues so they can assist his clients while he is away. Even while he is away, Eric typically checks his email and voicemail. He works about 45 hours a week during the non-busy season, but from mid-January through April he typically works 11-plus-hour days and weekends.
During the busy period, much of the work overlaps with tax requirements, such as producing the hedge fund’s Schedule K-1 for its investors. Eric does not prepare tax returns but works closely with the tax department.
Eric particularly enjoys having the opportunity to work with many companies at the same time and to get an overall picture of what they are doing. He says that every day offers something new and interesting.
Lindsey is a Certified Public Accountant (CPA) and works at an accounting, consulting, and tax services firm. Lindsey began as an intern, then took a full-time staff position after graduation. After two years, she was promoted to senior accountant in the firm’s hedge fund group.
Her firm works with more than 1,000 hedge funds, private equity funds, and other fund entities, as well as nearly 100 broker-dealers serving investment banks and retail brokerages.
If you like auditing but aren’t sure you want to dedicate your days to it exclusively, a career as a CPA offers some variety. In addition to working on hedge fund audits, Lindsey provides tax accounting, bookkeeping, and fund services.
The first thing Lindsey does when she comes into the office is to check her email and voicemail. As a senior staff member, she is usually the main contact for clients, so when she receives a request from them, she decides if it’s something she can handle herself, should delegate, or should seek a manager’s or partner’s guidance on.
She also responds to questions from the staff she supervises and completes requests from the managers and partners she works with.
Lindsey spends most of her day reviewing work prepared by staff., such as audit testing procedures, financial statements, tax returns, and various bookkeeping projects. She also spends time answering any questions from the staff while they prepare the work mentioned above.
She submits the reviewed work to her manager for another review and helps to finalize the audit or tax return and deliver it to the client. She also serves as a liaison between her team and the client when they have additional questions or items that need clarification.
Once a week, Lindsey assists her firm’s fund administration team with investor services. She reviews check runs twice a month and supervises month-end closing activities for clients that her firm performs back-office bookkeeping for and creates financials. The financials are used for monthly budgeting and regulatory filings.
These financials are audited annually, and Lindsey is the main contact for the auditors, providing any reports or answers they need on the financials. Lindsey typically works on about 15 audits and 30 tax returns each year. She says the variety keeps things interesting, with different issues and challenges from every client.
During tax season, Lindsey usually works from 7:30 am until 10:00 pm and comes into the office on Saturdays for about five hours. The rest of the year, she works from 7:30 am until 4:30 pm, which lets her have a personal life.
The off-season is a good time for vacation, and Lindsey is allowed eight weeks of paid time off per year. Lindsey says that her colleagues who are audit seniors may spend 80% to 90% of their time on auditing work, but she dedicates only about a third of her time to auditing.
Her auditing activities focus on testing the existence and valuation of the securities her hedge fund clients hold. She also tests investor capital activity and related party transactions such as management fees and the performance allocation paid to the general partner. She compares the percentages charged to each investor with those stated in the fund’s agreement to ensure their accuracy.
For her SEC-registered hedge fund clients, she prepares the audited financial statements that the funds must file with the SEC within 120 days of year-end. These clients also use their audited financial statements to report to current investors and to inform potential new investors.
Internal Audit Manager
Internal audit manager Daniel has spent the last eight years as an auditor or consultant and has held many positions from associate to manager. He currently works for a large retailer as an internal auditor. Daniel helps clients prepare for external auditors for their annual review.
An internal auditor’s job often requires collaboration with other departments and different levels of senior and executive management.
Internal auditors also have a greater ability than external auditors to perform operational assessments outside of finance. Daniel arrives at the office at 8:00 am and spends his first hour checking voicemail and email. From 9:00 am to 10:00 am, he meets with the audit director to go over departmental projects and news. He delves into his projects starting at 10:00 am, which typically includes meeting with various departmental personnel to collaborate on solutions to problems and risks identified by management or his department.
On a typical day, the projects he works on might include process improvements, internal control identification and testing, reviews of policies and procedures, audit planning, external audit assistance, reviewing work papers, inventory counts, IT audits, and, on rare occasions, fraud investigations.
Daniel spends a lot of time on operational audits and reviews, which examine how things work and the risks involved in operations. These audits take a month or longer, and the end result is an audit report with recommendations for management’s consideration.
This work often requires significant collaboration with various departments and different levels of senior and executive management. After an hour’s lunch break, Daniel spends two hours attending meetings similar to his morning meetings.
Then from 3:00 pm to 5:00 pm, Daniel digests and documents the information gathered during his meetings. He leverages his Microsoft Office skills, spending a lot of time working on process flow, advanced data analytics, and writing reports. From 5:00 pm to 6:30 pm, he wraps up any open items and prepares for the following day.
In weekly meetings that last from half an hour to two hours, he updates his firm’s vice president and director on audit projects, their status, and any issues, risks, or new projects. Twice a week, he attends change control board meetings related to system and process changes for the company’s information technology general controls such as user access, security, and operations.
Any and all changes made to programs, systems, or procedures must be documented, tested, and approved by a board of peers to mitigate risks related to unintended consequences of change, Daniel explains. Possible changes might include code changes, hardware and software upgrades, new system implementations, and policy and procedure changes.
Quarterly, he prepares presentations to update executive management on change control audits, which entail verification of development and testing activities, checking for requisite approvals throughout the process, and post-implementation reviews to ensure that all policies and procedures for change management have been adhered to. Once a year, he works with external auditors for his firm’s annual audit. He assists in risk identification and in producing an audit plan.
Daniel most enjoys his job’s problem-solving aspect. Identifying risks specific to his company and its different operational areas requires great collaborative and analytical skills, he says. He works an average of 50 hours a week and says his company’s culture is fast-paced and high-performing. As a relatively new employee, he gets 2.5 weeks of vacation.