Internal Audit vs Statutory Audit: Key Differences Every Business Should Know | Akshay Baheti & Co.
Auditing plays an important role in maintaining financial transparency, strengthening internal controls and improving confidence in business information. However, internal audit and statutory audit are not the same thing . Businesses often use these terms interchangeably, but they have different objectives, scopes and reporting purposes. Understanding the difference between internal audit and statutory audit can help business owners and management determine what each type of audit is designed to achieve and why both can be valuable in the right circumstances. Under the Companies Act, 2013, internal audit is addressed under Section 138 for prescribed classes of companies, while statutory audit and the appointment and duties of auditors are covered under Sections 139 and 143. The exact applicability depends on the entity and applicable rules. Ministry of Corporate Affairs What Is an Internal Audit? An internal audit is a structured review of an organisation's internal processes, co...