a review of financial statements and accounting records by an accountant not belonging to the firm.
is an audit conducted by an individual or firm that is independent of the company being audited. These independent auditors audit the books of a company generally once per year (see INTERIM AUDIT) after the completion of the company's fiscal year. Their role is to give an opinion of the financials statement's reflection of the status and operations of the company being audited. Based on what they witness during the audit they will also produce, for management and board utilization, a management letter. Although a financial statement audit is the most common type of external audit, external auditors may also conduct special purpose audits which might include; performing specific tests and procedures and reporting on the results, a less intensive review, and compilations.
A financial audit carried out by an independent auditor, separate from the organisation, which provides an opinion whether financial reports are "true and fair". External auditors may also write a management letter, which comments on important issues noted in the organisation's internal controls.