What is an Internal Auditor?

The video tutorial discusses the role of internal auditors within a company, highlighting their responsibilities in providing internal controls and governance work. It explains the reporting structure where internal auditors report functionally to the Audit Committee and administratively to management. The tutorial also contrasts internal auditors with external auditors, emphasizing the lack of independence of internal auditors, which prevents them from conducting external audits. However, internal auditors can assist external auditors by providing basic documents and financial information.

What is a key difference between internal and external auditors?

• External auditors provide internal controls.

• Internal auditors may work directly for the company.

• External auditors report to management.

• Internal auditors are independent from the company.

To whom do internal auditors functionally report?

• The Board of Directors

• The Audit Committee

• The CEO

• The CFO

What challenge do internal auditors face due to their reporting structure?

• Balancing the needs of the Audit Committee and management

• Providing external audit services

• Reporting directly to shareholders

• Maintaining independence from the company

Why can't internal auditors perform an external audit?

• They are not certified auditors.

• They do not have access to financial statements.

• They are not independent from the company.

• They lack the necessary skills.

How can internal auditors assist external auditors?

• By ensuring independence from the company

• By providing basic documents and financial information

• By reporting directly to the external auditors

• By conducting the external audit themselves