Internal audit vs external audit
What is the difference between an internal audit and the annual external audit?
The main external audit is a statutory requirement which checks that the University’s accounts present a true and fair view of the financial position and also as proof to HEFCE that the money is properly expended – the work is on an annual cycle and primarily involves the Finance Services teams, peaking at the October/ November period. External audits may also be required for other, specific, elements of our activity eg our compliance with US Federal requirements in the certification of student loan funding under the Federal Family Education Loan Programmes.
To be effective, Internal Audit must be distinct from, and independent of the Institution’s External Audit provision.
The Internal Auditors report to the University’s Council through the Audit Committee, on the systems of governance, risk management, internal control, value for money and the extent to which strategic initiatives are attaining their goals across the University, although this does not extend to the academic process. This means the scope of the work is much wider than External Audit and covers a number of non-financial areas used within the University, with multiple audits in any one year, involving a range of areas of the University’s operations. Internal Audit is not, however, a substitute for good management – this responsibility rests fully with the senior management of the University.