Aim: To analyse the differences and similarities of external audit approaches in public and private sector in Scotland. Objectives: To describe the main principles of private and public sector and the role and purpose of external audit. To identify the external audit approaches and apply them accordingly into both sectors; differences and similarities.

Background Public sector definition: Public sector is provided by government and it includes the police, military, public roads, public transit, primary education and healthcare.; services which benefit all of society. Public sector is one of the largest sectors of any economy. Private sector definition: Private sector is the part of nation’s economy which is not controlled by the government. Objectives of private sector are profits. What's an external audit? An external audit is a review of the annual financial statements or reports of a public or private company. Contrary to internal audit, external audit thinks only about truth and not about value for money. External audit plays a major role in analyzing financial statements because it is conducted by someone not affiliated to the entity being audited

Auditing standards

Public sector Private sector High quality standards and guidance are Set by Audit Practises Board and internal set up by the APB. Certain procedures advice from individual firms. are described more specifically to cover aspects of the wider audit. Procedures are put in place to ensure that the work is undertaken to an appropriate standard. Parliament, Ministers, Agency, Treasury Annual report to shareholders and finance Audit appointments are determined by Made by independent central body management or audit committee. Formally, the annual general meeting approved it. Planning should be define with the Knowledge of the auditor and his experience in the organization audited management and in accordance with will be decisive for planning. On top of internal