What are the differences between external and internal audit reports ?Difference between the actual reports rather than the difference between...

There need not be any difference between internal and external auditing reports. The external auditing reports conforms to requirements specified by applicable rules and regulations. In contrast, the scope of internal audit audit and the reports that cover these audit conform to the specifications laid down by the company management. There is nothing that prevents management of a company to specify the same requirements of internal audit report as applicable to the external audit report. However it does offer some advantage to the firm and the management to retain some degree of commonality between the internal and external audit reports.

The exact difference in the internal and external audit reports will differ from company to company depending upon the thinking and requirements of the top management of the company. However, we can see the following general pattern of differences between external and internal audit reports.

• Internal audit and its reports are likely to be more frequent as compared to external audits.


• Internal audit reports are likely to be more detailed.


• Internal audit reports are designed to focus on internal control of the company by the management, while the external audit are designed to certify and control the performance of the top management.


• External audit is based on examination of finalized accounts of the company approved by the board of directors. Internal audit, in contrast is done prior to finalization and certification of accounts by the top management.


• Internal audit may also cover the aspects of management performance and effectiveness. External audit are more focused on adherence to laid down systems and procedures.