what is internal audit ? explain difference between internal audit and interim audit
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Answer:
Internal auditing is an independent, objective assurance and consulting activity designed to add value to and improve an organization's operations.
Interim audit is a part of external audit where an auditor commences audit before the year end. This is to reduce work pressure at finalisation stage. So for a company having an year end in December, auditor may commence work in September to reduce work pressure at year end. Note that this is different from a half yearly review which would be a separate engagement.
Internal audit is carried out by the company itself. The internal audit department of the company carries out internal audit activities to ensure effective running of the company.
Internal audit and external audits are similar however there are some key differences. External audit is focused on the financial statements and whether there are any material misstatements thereon. Whereas, Internal audit is focused on the internal controls of the company and whether there are any deficiencies in the company’s internal control systems. External auditors also consider internal controls but its not their main focus.