in recent decades auditing has become increasingly important within the accounting and business world I'm Thomas Harwood and welcome to the County student where we create free and short videos so that you can learn about accounting today's video is looking at what is auditing every day businesses are becoming more competitive and expanding their services anchors internationally due to this businesses have to be more accountable for their actions and activities they are involved in and more specifically businesses have to follow accounting standards and formats by law when providing a financial statement for the users this is where auditing takes place alderton is a process of inspecting and evaluating the financial statements of an entity to check if the claims in the statements are fairly and accurately represented an independent party usually performs an order and this is useful in removing any bias or error in the financial statements as well as attempting to prevent fraud the majority of entities will have an audit once a year and bigger entities will have regular audits normally on a monthly basis there are two types of order they can be categorized into internal order and external internal auditing are individuals within an entity who perform an audio internal Auditors will examine the financial reports and then provide information to the owners managers and other stakeholders about the accuracy of the accounts and the efficiency of the internal controls of the statements external auditing are individuals independent to an entity that perform an audit they will also evaluate with natural pulse of an entity to make sure that they are free or fraud and misstatements and most importantly provide an opinion on whether the reports are a true and fair reflection of an entity's financial position additionally these Auditors follow a set of Standards different to the internal Auditors so that was the explanation of all detained if you enjoyed it press the like button if you have a question you want answered leave it in the comments below and we'll try our best to answer it and if you're not already subscribed make sure you click the red subscribe button to keep updated with the accounting student thanks for watching we'll see you next time [Music]