Internal audits are performed by which party?

• A. The organization itself
• B. External auditors
• C. Both A and B
• D. Neither

Answer: (A)

Internal audits are performed by the organization itself. This function is created by the organization to independently assess its own risk management, control environment, and governance processes, and to suggest improvements. While the internal audit team must remain objective and free from day-to-day operations, they are part of the organization and usually report to the board or an audit committee to maintain oversight. External auditors, in contrast, are independent third parties who audit financial statements to provide assurance to investors and regulators.