Relationship Between Internal Audit and

Relationship Between Internal Audit and the External Auditor

9 The role of internal audit is determined by those charged with governance and management, and its objectives differ from those of the external auditor who is appointed to report independently on the financial report. The internal audit function’s objectives vary according to the requirements of those charged with governance and management. The external auditor’s primary concern is whether the financial report is free of material misstatements and is prepared, in all material respects, in accordance with an applicable financial reporting framework.

10 Nevertheless some of the means of achieving their respective objectives are often similar and thus certain aspects of internal audit may be useful in determining the nature, timing and extent of external audit procedures.

11 Internal audit is part of the entity. Irrespective of the degree of autonomy and objectivity of internal audit, it cannot achieve the same degree of independence as required of the external auditor when expressing an opinion on the financial report. The external auditor has sole responsibility for the audit opinion expressed, and that responsibility is not reduced by any use made of internal audit. All judgements relating to the audit of the financial report are those of the external auditor.