CIMA BA4 Syllabus B. CORPORATE GOVERNANCE - Internal & External Auditor - Notes ^{2 / 11}

	internal auditing	external auditing
role	to advise management on whether the organisation has sound systems of internal controls to protect the organisation against loss	to provide an opinion to the shareholders on whether the financial statements give a true and fair view
legal basis	generally not a legal requirement. however the combined code on corporate governance recommends that if a listed company does not have an internal audit department, it should annually assess the need for one.	legal requirement for large companies, public companies and many public bodies
scope of work	determined by management. covers all areas of the organisation, operational as well as financial	determined by the auditor in order to carry out his statutory duty to report. financial focus
approach	increasingly risk based. assess risks. evaluate systems of control. test operations of systems. make recommendations for improvements	inreasingly risk based. test underlying transactions that form the basis of the financial statements.
responsibility	to advise and make recommendations on internal control and corporate governance.	to form an opinion on whether the financial statements give a true and fair view