What is the difference between Internal and External Audits?
Though both the audits share similar characteristics, yet the objective they strive is distinct. On one hand External Audit delivers financial reports and mentions the risks involved there, on the other hand Internal Audit’s reach is quite wide. It examines every area that can affect the progress and success of an organization. Both the Audits also differ based on whom they report.
Why does Internal Audit matter?
Continuous growth of any firm seeks frequent Audit, as it unveils any inappropriate activity or fraud that is prevailing in a specific field. How frequently a firm audits, depends on the areas or department involved. While some of them require daily audit, for some annual audit is sufficient. This audit thus enables a firm to evaluate the risk and then manage it, for which a final report is submitted to acknowledge whether the processes are functioning suitably. Foremost, these reports are presented to the senior executives who provide an independent review on the same. Regarding this, Auditors also provide consultation for improvising in particular areas.