Accountant vs Auditor
An accountant is a professional hired by a company to record its transactions and present them in financial statements, while an auditor is hired to analyze and evaluate the books kept by an accountant to generate confidence in the company’s stakeholders. Although both roles involve accounting, there are key differences between them.
Key Takeaways
- An accountant prepares financial documents, while an auditor analyzes and evaluates the accountant’s work.
- An accountant is a permanent employee of an organization, while an auditor is an unbiased outsider.
- An accountant’s job is to maintain accounts and prepare financial statements, while an auditor’s job is to verify the accountant’s work and detect any potential fraud.
An accountant carries out day-to-day bookkeeping duties and works under the direction of the board of directors, preparing financial statements at the end of each fiscal year. On the other hand, an auditor is an external professional who checks the accuracy of the accountant’s statements to ensure there is no misrepresentation of facts or compromise of stakeholder interests. The auditor verifies that assets and liabilities mentioned in financial statements exist and performs impartial valuation.
One notable difference is that an accountant is not required to be a Certified Public Accountant (CPA), while it is mandatory for an auditor to be one.
In summary, both accountants and auditors specialize in accounting, but the former is an employee of the organization and focuses on bookkeeping and financial statement preparation, while the latter is an outsider hired to audit the documents impartially and ensure the absence of fraud or misrepresentation.
