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DISCUSSIONS > IIA GENERAL DISCUSSION AREA [ REFRESH ]
Thread Title: Does an internal auditor need to be a CPA
Created On Friday April 03, 2009 5:09 PM
  Does an internal auditor need to be a CPA
  Does an internal auditor need to be a CPA
  Does an internal auditor need to be a CPA
  Does an internal auditor need to be a CPA
  Does an internal auditor need to be a CPA


ATX


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Friday April 03, 2009 5:09 PM

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In some recent communication with the Texas State Board of Public Accountancy they have indicated that "audit" is a term restricted to registered CPA firms. Has anyone dealt with the issue in Texas or another jurisdiction? It would seem to prevent even CIAs from performing internal audit work unless they were CPAs.

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I think - I can

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BeachyKeen


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Friday April 03, 2009 5:37 PM

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According to the Texas Administrative Code, Title 22, Part 22, Subchapter D, Rule 501.80: "A person may not engage in the practice of public accountancy unless he holds a valid license or qualifies under a practice privilege."

I know of many internal auditors, including CAEs, who are not CPAs (and by the way - I'm from Texas!). As long as the internal auditor does not participate in some activity which could be construed as the practice of "public" accountancy, there should be no problem.


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roblarose


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Monday April 06, 2009 6:51 PM

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<< In some recent communication with the Texas State Board of Public Accountancy they have indicated that "audit" is a term restricted to registered CPA firms. >>



Well, I bet the quote is not complete, but as it stands, they are partially right......

A certified financial "audit" is performed by Certified Public Accountants.

However an internal "audit" (operational, financial or compliance) is performed by.....an Internal Auditor.



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Akhil


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Monday April 06, 2009 7:43 PM

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External Audit is done exclusively by CPA.

But an internal audit can be done by CPA and non CPA.

Infact, in the practice advisory proficiency, it is clearly mentioned internal audit department needs diverse skill set and professionals from all backgrounds can do internal auditing..however proficiency in internal audit techniques, standards and code of ethics is mandatory.

A general appreciation of accounting principles is enough but if you are doing financial audits, then proficiency in accounting principles and practices is required which a CPA brings on table.

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planoisdaudit


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Tuesday April 07, 2009 9:25 AM

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From the TSBPA web site:

The Texas State Board of Public Accountancy (Board) operates pursuant to the authority of Chapter 901 of the Texas Occupations Code, short titled the Public Accountancy Act (Act). As provided in the Act, the terms “accountant” and “auditor” and any derivations of those terms imply competence in the practice of public accountancy. The public relies on that implication of competence when it employs a Certified Public Accountant (CPA). The Board, in order to protect the public and ensure competence in the practice by the profession, examines, certifies and licenses CPAs and restricts the use of these terms to its licensees.

I used to work for a firm that at one time was named "Audit Force". They did not perform attestation services. Instead they performed consulting services in accounting, tax, technology, and internal audit. The state of Texas and several other states sued them and made them change their name because the ther "Audit" is a regulated term in these states. As a result, non CPA firms cannot legally use the words "auditor" or "accountant" in their legal or dba names.

I work in Texas, we still call the staff that performs the financial record keepping accountants and we still use the term internal auditors. These individuals may or may not have a CPA. I hold CIA and CGAP certifications as an internal auditor, but no CPA. My external auditors have no problem relying on my work and the state is not knocking on my door because my agency uses the term "auditor" in my job title.

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Dan
Integrity can be defined as your moral soundness. A test for integrity - Do your actions match your words?

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DISCUSSIONS > IIA GENERAL DISCUSSION AREA [ REFRESH ]
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