Difference Between Internal And Internal Audit

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An audit is considered to be an extensive and detailed investigation of financial statements that are submitted by business organizations. The brief subject of this examination is to make sure the reliability, accuracy, and transparency of the statements as they must be developed according to specific standards. In addition, an audit ensures that there will be no commission of fraud in the future. There are two major types of the audit which are external and internal. First of all, an external auditor is not hired by a company itself and carries out the comprehensive evaluations of the financial reports independently. On the other hand, an internal audit is conducted by the hired employees of the organizations, and they submit the final results …show more content…

It is the duty of companies’ auditors’ to ensure the financial stability checking and notifying all the possible errors that may occur during the operations. Audit operations should be objective in order to reach the highest level of accountability and accuracy as the future incentives of the companies for further development depend on the significance and reliability of the data which is presented on the financial statements including income statement, balance sheet, and cash flow statement. During an audit process, auditors may provide positive opinions in case of no errors and misconceptions. On the other hand, if they are not able to report positive statements, they may have a qualified and adverse opinion, or a disclaimer of opinion. Qualified opinion means that reports demonstrate the position of the company in a correct manner with a little amount of errors. Additionally, adverse opinion illustrates that the statements do not present the fair and true position of the company. Differently from both of them, when an auditor is unable to report efficient amount of information because of lack of collected data and evidence to define the situation, the opinions he or she shares is called a disclaimer of opinion. Thus, the main role of the audit is to conclude whether adequate evidence and data are received, and whether this information is submitted in a proper and clear manner in terms of understandable language and classification according to the

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