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What Does a Government Auditor Do?

By Theresa Miles
Updated: Mar 03, 2024
Views: 13,111
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A government auditor evaluates whether public funds were used according to the mandate associated with the funds. The position is typically divided into internal and external auditors. Internal government auditors check the financial records of government agencies to ensure compliance with financial standards. External government auditors check the activities of non-governmental third-party recipients of government funds to ensure the funds were spent in accordance with the agreements governing the allocation of public money.

Auditing is a process where a financial specialist, typically trained in accounting methods, reviews and assesses an entity's financial records, uses of funds and compliance with financial controls. In the private sector, auditing is a mechanism that is used to ensure that companies operate in the best interests of their investors, and not for the financial gain of insiders. Likewise, auditing performs a similar function in the public sector, with the caveat that any discrepancies revealed by an audit can result in criminal and civil consequences.

Government audits concern the use of public funds, which have a heightened degree of accountability. Public funds are typically allocated to government agencies for their own use or for distribution to third-parties under authorization of a country's legislative body. The authorization of funds is usually tied to a whole slate of things that can and cannot be done with the money that is outlined in the specific authorization and in any overarching government fiscal policy that concerns the allocation. For example, the specific funds authorization may allocate money to a veteran's administration to encourage small business development, but a general governmental policy might prohibit public money from going to any vendor that discriminates in its hiring practices. The government auditor would have to check not only that the funds were used as specified in the funds authorization, but also that the use complied with general governmental policies.

Internal government auditors are typically assigned to audit an agency or a specific allocation of funds to multiple agencies under a single legislative authorization. They go into the agency and perform a checklist of tasks that include reviewing financial expenditures and determining compliance with financial protocols. An internal government auditor spends most of hi s time reviewing the agency's record-keeping to establish that public money has not been used in an unauthorized manner.

External government auditors typically inspect the activities and financial records of vendors, grantees and contractors that receive government money. The important distinction between internal and external auditors in a government context is that the external auditor usually must also evaluate whether the government is getting its money's worth. For example, an external government auditor who is assigned to audit a government health care reimbursement program must not only determine if the financial affairs are in order but must also look to the way the medical care is provided to ensure the government is not being defrauded.

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