Explain the Role of the Internal Auditors and External Auditors

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The Answer is a. Internal auditors are primarily responsible for overseeing the effectiveness and efficiency of operations. This includes monitoring the reliability of organizational processes that transform information. The quality of the internal audit function directly impacts the level of control within an organization. In the United States, all publicly-owned companies have an internal audit function that reports directly to the audit committee of the board of directors.
b. The external auditors play a critical role in corporate governance because the external auditors are independent, unlike the internal auditors. They provide an important assurance about the quality of information available to the Board and to stakeholders. The external auditor is a trusted arbiter of the organization's information, who evaluates, as an independent third-party, the objectivity, relevance, reliability and understandability of corporate information. This results in a reduction of the potential impact of information asymmetry and questionable ethics.

Explain the Role of the Internal Auditors and External Auditors

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