What is a CIA?

Auditors play a crucial role in monitoring the financials of various business and government organizations. Furthermore, these financial investigators are tasked with validating transactions and searching for signs of fraud and misuse of funds within an organization. Basically, auditors play a law enforcement-type role and make sure everyone is playing by the rules when it comes to spending and reporting the financial status of a company.

A Certified Internal Auditor (CIA) is a professionally designated auditor that has passed the exams and met lengthy requirements from the American Institute of Internal Auditors (IIA). This should not be confused with an agent of the Central Intelligence Agency, which also shares the same abbreviation. The CIA certification is globally recognized as the gold standard of the industry, and signifies that the professional who holds this certification has the professional and educational skills and knowledge to perform auditing tasks.

However, to understand why having a professionally certified auditor analyze company financial statements and make recommendations to management is important, it helps to understand in more detail more what a certified internal auditor does.

What does a CIA do?

When a company hires a Certified Internal Auditor (CIA), they are tasked with two main goals:

• Audit the companies financial statements to make sure that they reflect the reality of the companies financial position
• Work with management to create systems to prevent loss, theft and fraud during business operations

In contrast to a regular auditor who comes in only to go over the companies financial statements, CIA’s are a little more involved. One of their typical duties is helping to create systems to prevent fraud and misuse of funds before they occur. Additionally, they also help with systems to prevent losses that negatively impact financial statements in other ways, like theft, damaged goods and product loss.

Because CIA’s are heavily involved and trusted by management of the organizations they work for, designating yourself as a certified professional in this field is crucial! Next, let’s go over the steps and requirements to earning your CIA certification!

How do you become a CIA?

To earn your Certified Internal Auditor (CIA) certification, you’ll first need to meet the eligibility requirements set forth by the Institute of Internal Auditors (IIA) before sitting for a three-part exam.

Let’s talk about the educational requirements first!

For many years, you had to have completed a collegiate degree program in order to earn your CIA certification. However, the IIA has recently allowed an additional pathway for individuals who don’t meet the educational requirements. We’ll go over both of these pathways below.

Educational Requirements

In order to be approved for your CIA certification, you’ll need to have at least an Associate’s Degree or the global equivalent.

Some of those global equivalents are:

• Foundation Degree
• Diploma of Higher Education
• Higher National Diploma
• Three A-Level Certificates with a grade of C or above

Additionally, you’ll need to provide documentation to prove your educational background. You can submit a copy of your degree, official college transcripts, training program certificates, or other collegiate certificates. Furthermore, you can also provide a letter from your university confirming the degree.  

As we mentioned before, you can request an exception from the educational requirements if you can demonstrate seven years work experience in internal auditing (or equivalent).

Of the seven years of internal auditing experience, at least three needs to have been in the last four years. You can even submit your exemption request if you’ve only completed four out of the seven years required - you’ll just need to earn an additional three years of work experience in the four year CIA program eligibility window before you can get your certification.

You’ll still need to provide some educational and professional documentation to support your exemption request. These include:

• High school diploma, secondary school certificate or a General Certificate of Education
• Your Resume
• A Letter from your current manager indicating you have the academic skills to cope with a post-graduate program
• Professional Experience Documentation

Character Reference

A CIA career typically involves dealing with sensitive information and investigating financial dealings on a regular basis. Consequently, this means they can’t be dishonest or engage in fraudulent behavior themselves. Because of this, a character reference is also a necessary part of the application process.

The character reference form must be signed by a CIA, CGAP, CCSA, CFSA, CRMA or your direct supervisor. Additionally, this reference form must support your high moral and professional character. The form can be found here.

Work Experience

Work experience in the field of internal auditing is required; the necessary number of years work experience is dictated by your education level.

• Associate’s Degree Holders (or the global equivalent) are required to have five years of internal auditing experience
• Bachelor’s Degree Holders (or the global equivalent) are required to have two years of internal auditing experience
• Master’s Degree Holders (or the global equivalent) are required to have one year of internal auditing experience.

You can apply for and even sit for the exam without meeting all of the work experience requirements first. However, you’ll need to obtain the appropriate amount of work experience before the program eligibility window expires - four years from your program acceptance date.

The CIA Exam

The CIA Exam is notoriously tough, with exam pass rates usually in the high 30% to low 40%. On average, 6 out of 10 test takers fail. Therefore, creating an early study strategy and learning as much of the curriculum as possible is highly encouraged in order to help you succeed on this exam.

The CIA exam is divided into three parts:

• Part I - Essentials of Internal Auditing - 125 questions, 2.5 hours time to take
• Part II- Practice of Internal Auditing - 100 Questions, 2 hours time
• Part III- Business Knowledge for Internal Auditing-  100 Questions, 2 hours time

On average, you have roughly 72 seconds to answer each question.

Unlike many other professional exams, each question is scored equally and carries equal weight. Ultimately, the passing mark is 75% on the entire exam, with the passing score of each part of the exam graded a little difficulty (this is because Parts 2 and 3 are notoriously difficult.)

Cost of the Exam

Aside from the money you set aside to invest in prep courses and study materials, make sure you plan for the costs of the actual exam. Here’s a breakdown of the associated fees:

• Application Fee
  • IIA Member Exam Fee - $115
  • Non-Member Exam Fee- $230
• CIA Exam Part 1 Fee:
  • IIA Member Part 1 Fee - $280
  • Non-Member Part 1 Fee- $395
• CIA Exam Part 2 Fee:
  • IIA Member Part 2 Fee- $230
  • Non-Member Part 2 Fee- $345
• CIA Exam Part 3 Fee:
  • IIA Member Part 2 Fee- $230
  • Non-Member Part 2 Fee- $345

You’re not required to be a member of the IIA when you take the exam, but as you can see it will probably save you a lot of money!

How much can I earn as a CIA?

Although the cost and time requirements of becoming a CIA might make you balk a little, try viewing the process as an investment. After all, according to the IIA’s 2017 Internal Audit Compensation Survey, certified CIA professionals earn $38,000 more on average than internal auditors without the certification!

Furthermore, according to Glassdoor.com the average base pay of a CIA professional is $65,541 a year. However, that number can climb to $77,000 a year based on the size and type of organization you’re working with, and it doesn’t include bonuses or other cash perks of the job!

Interested in becoming a CIA? Because the exam is so difficult and the pass rate is so low, the first step you should take is investing in a quality prep course to study for the exam with. Check out our side by side comparisons of some of the top review courses on the market today to help you crush your CIA exam!