An internal auditor is an auditor who is appointed by the management of the company in order to carry out the internal audit function. Generally an employee of the company acts as an internal auditor, whereas some companies appoint an external expert as an internal auditor.
Though an internal auditor is appointed by the management or an employee of the company, independence is the prime requisite for the execution of an internal audit. Compromise in independence may distort the objectivity of an internal audit.
An internal auditor is responsible to the Board functionally and administratively to the management of the company, and the auditor submits the report to the Board.