Internal and External Audit

Question 1

Internal Audit

Answer 1

An analysis of the business itself and how it operates. It attempts to identify the companies own strengths and weaknesses

Question 2

what dose an internal Audit look at/ for

Answer 2

Looks at:
-Products and their costs, quality and development
-Finance including profit, assets and cash-flow
-Production including capacity, quality, efficiency and stock management
- Departmental structures
-Human resources including skills, training and recruitment

Question 3

External Audit

Answer 3

An analysis of the environment in which the business operates. It has very little or no control over many of out side factors

Question 4

what dose an External Audit look at/ for

Answer 4

MARKET – The size and growth of the market
MARKET – Characteristic of customers
MARKET – The products on offer
MARKET – The prices of products

COMPETITION – The number of competitors
COMPETITION – The size of competitors
COMPETITION – Ease of competitors entering the market