What is an External Auditor?

The video explains the role of external auditors, who must be independent from the company they audit. Typically employed by public accounting firms, they are hired to perform audits. In the US, external auditors must be certified public accountants (CPAs), although non-CPAs can assist in audit tasks but cannot issue audit opinions.

What is a key requirement for someone to be considered an external auditor?

• They must be independent of the company they audit.

• They must be a shareholder in the company.

• They must be employed by the company they audit.

• They must work in the finance department of the company.

Where are external auditors typically employed?

• By government agencies.

• Within the company they audit.

• In the company's internal audit department.

• By public accounting firms.

What is a requirement for an external auditor to perform an audit in the US?

• They must be a certified public accountant (CPA).

• They must be a member of the company's board.

• They must have a degree in finance.

• They must have at least 10 years of experience.

Can non-CPAs issue an audit opinion?

• Yes, but only if they have more than 5 years of experience.

• No, they cannot issue an audit opinion.

• Yes, they can issue an audit opinion.

• No, unless they are supervised by a CPA.

What role can non-CPAs play in an audit team?

• They can make final decisions on audit opinions.

• They can assist with performing test work.

• They can lead the audit team.

• They can issue the final audit report.