An auditor is an individual who examines the accuracy of recorded business transactions. Auditors are needed in order to verify that processes are functioning as planned, and that the financial statements produced by an organization fairly reflect its operational and financial results.
An internal auditor works for the entity which he or she audits. An external auditor is independent of the clients which he or she audits. An external auditor may be certified by a state agency to be a certified public accountant, and thus allowed to issue certified reports on the financial condition of clients. An external auditor may instead work for a government, and in that role is tasked with examining the records of individuals and businesses to see if they have complied with the various tax laws.