The need for auditing of the financial statements was created by the appearance of a capital company when some equity holders demanded that business results prior to the acquisition and division of profits should be verified by independent experts. Information is power and has a significant impact on society, people's behavior and perception as well as their decision-making process at different levels. The key to business success is the effective use of information. By implementation of the external audit an effort is being made to protect the interest of the equity holder, tax authorities, creditors and potential investors. Research goal of this paper is to examine and determine the meaning of the external audit of the financial statements in the Republic of Croatia. The main goal of the research is to determine the process of auditing of the financial statements in accordance with the International Standards on Auditing. The implementation of the external audit is explained in the paper on the example of the business of the company Janaf d.d. for which an audit opinion on that company’s business is being provided to explain the audit procedures and to emphasize the importance of auditing of the financial statements in the business conducted by the company.