A measurement and report on the state of a person's or business' finances, made by an external agency. A common (and feared) example of an external audit is an audit by the
IRS, which is done to ensure that the person or business being audited has paid the appropriate amount in taxes. Often, companies hire audit firms to look at their financial states and to receive an objective assessment. It is also called an outside audit. See also:
Internal audit,
Audit.