External Audit
An independent examination of an organization's financial statements, operations, and compliance with laws and regulations conducted by an external auditor.
An external audit provides an objective assessment of an organization's financial and operational activities. It is conducted by external auditors who are not part of the organization being audited.
The primary purpose of an external audit is to provide assurance to stakeholders, such as investors, lenders, and regulators, that the financial statements are accurate and reliable.
External audits are also used to evaluate the effectiveness of the organization's internal controls and to identify areas for improvement.
Related Terms
Internal Audit
An independent, objective assurance and consulting activity designed to add value and improve an organization's operations by evaluating and improving the effectiveness of risk management, control, and governance processes.
Three Lines of Defense
A model that separates an organization's risk management and control functions into three distinct lines of defense to ensure effective oversight and governance.
Audit Evidence
Information obtained by auditors during an audit to provide a reasonable basis for their conclusions about the subject matter.
Automate compliance with Matproof
DORA, SOC 2, ISO 27001 — get audit-ready in weeks, not months.
Request a demo