Online discussion
The government may require a firm to be audited by both the internal and external auditors. This kind of provision may be a matter of policy by the government. External auditing, as a requirement by the government, may mostly apply to those projects within the company that is directly funded by the government or indirectly by various international bodies such as the International Monetary Fund (IMF), and the world bank.
Fraud prevention is the other element that may necessitate external auditing (Turner, 2014). The external auditors can dig deep into the books of accounts of the organization without them being compromised as a result of personal affiliations, which is common among internal auditors. In this case, there will be impartiality, since there is an increased likelihood that the internal parties may not have come across the external audit team before. As a result, this will lead to fraud prevention, which would have not been uncovered as a result of existing relationships between the internal auditors and the parties in charge of keeping the books of account of the company.
Last but not least, in order to attain credibility, there would be a need for a firm to have external auditors (Turner, 2014). It should be noted that the financial statements of firms may carry more weight when they are passed through vetting by external auditors. When the firm is a family business or a partnership, external auditing will serve a great deal in highlighting the financial health status of such an entity. On the other hand, when the firm is a publicly-traded organization, external auditing would help in providing an unbiased glimpse of the accounting practices of the organization. Lastly, external auditing is important to an organization as it will help in coming up with an objective view and recommendations where necessary.
Reference
Turner, J. R. (2014). Gower handbook of project management. Surrey, England; Burlington,
VT: Gower.