Audit committee
In one sentenceA committee formed by the board of directors or the owners that oversees financial reporting, internal control and internal audit, and follows the external auditor's work.
Simply put
The audit committee is a bridge between the auditors and the owners: it receives the internal and external audit reports and makes sure management addresses the findings.
Its members' independence from executive management is what gives it its value.
Example
Before the annual statements are approved, the audit committee meets the external auditor without management present, to ask about any difficulties faced or findings not yet addressed.