Learn in the textbookSignificance, Types, and Structure of Systems Auditing
DefinitionA financial audit (会計監査) independently checks whether a company's financial statements (財務諸表) correctly present its financial position and operating results.
ExplanationShareholders, lenders, and business partners rely on the figures in financial statements when deciding whether to invest, lend, or trade. A financial audit is how outside experts vouch that those figures can be trusted, and it is mainly carried out by certified public accountants or audit firms.
AnalogyIt is like having a third party match a household ledger's totals against each receipt and the bankbook to see whether anything was left out or inflated.