Auditing vs Accounting: Understanding The Difference

The phrases “auditing” and “accounting” are frequently used synonymously in the financial industry. They do, however, refer to two distinct professions with various roles, credentials, and skill sets.

To ensure accuracy, compliance, and transparency, an organization’s financial records, processes, and systems are reviewed and evaluated during an audit. The duty of an auditor is to provide an unbiased opinion on the financial accounts of the business they are auditing. Auditors are qualified professionals who operate independently of the organization they are reviewing.

The recording, classification, and summarization of financial transactions, on the other hand, are all part of accounting and result in the creation of financial statements for a business. Accountants are in charge of keeping track of a company’s finances, creating financial statements, and giving the company financial guidance.

Even though the two professions have certain similarities, auditing and accounting are not the same. The specialty of auditing necessitates further education and certification above and beyond that of an accountant.

Depending on their location, credentials, and expertise, auditors may earn a sizable pay. The three states with the highest pay for auditors are California, New York, and Texas, according to statistics from the Bureau of Labor Statistics.

One of the biggest accounting and auditing organizations in the world, Deloitte, offers competitive pay to its auditors. The average annual income for an auditor at Deloitte is $77,000, and some earn more than $100,000, according to Glassdoor.

A substantial amount of study and training are needed to become a Certified Public Accountant (CPA), and the work is occasionally stressful. It can be a stressful work for CPAs to manage the financial records of an organization, create financial statements, and offer financial advise. However, a lot of CPAs enjoy and find the work challenging.

An accountant who has passed the Uniform CPA Exam and complied with extra state licensure criteria is known as a CPA. Auditing, tax planning, and financial counseling are just a few of the many accounting tasks that CPAs are capable of handling. On the other hand, accountants are qualified to handle fundamental accounting duties including bookkeeping, creating financial statements, and maintaining the financial records of a firm.

Conclusion: Despite some overlap, auditing and accounting are two distinct professions with unique roles, requirements, and skill sets. The specialty of auditing necessitates further education and certification above and beyond that of an accountant. Depending on their location, credentials, and expertise, auditors may receive a significant pay. It takes extensive study and training to become a CPA, and the work is occasionally difficult.