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Essential auditing terms

Essential auditing terms

Auditing definition

What is auditing?

Auditing is a related but separate discipline to accountancy. There are two types of auditing; namely internal auditing and external auditing.

Most common auditing words with definitions

  • Auditor: a person who examines a company’s financial records.
  • Auditee: the company being audited.
  • Audit client: the company or the person that requests an audit.
  • External auditing: a process whereby an external auditor is appointed from outside the business (organization) so as to examine its financial records (financial statements) in order to show that the records are true and correct.


  • Internal audit: the process of examining a company’s accounting records and financial statements usually by an auditor who is employed by the same company. The internal audit report provides information for the management of the company.
  • Auditor’s report: a brief report which indicates that the financial statements have been audited. It also gives the auditor’s opinion about the financial statements.

The most common English words, expressions and collocations for banking and finance.

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