ABSTRACT
This chapter provides a summary of how modern auditing began and traces its development through its different stages of change which has resulted in it being an integral part of today's organisational governance systems in terms of providing assurance services to business owners as well as to many other interested parties including the public. The chapter also scrutinises the differences and similarities between the two main classes of audit internal and the external with a view to establishing a contextual definition of auditing. It focuses on how the audit profession has adopted or is likely to further implement information technology (IT) facilities, tools and techniques, a general background to auditing will be provided. Auditing is an important third party assurance in the principal-agent problem that arises between the owners of capital and those in charge of the day-to-day running of the business. Historically, both the UK and the USA have served as the main centre of audit development.
