External audit plays an important role in business decision making and corporate governance, and it is essential to ensure its good performance. To ensure the high quality of the external auditing, the person who conducts it (authorized auditors) need to comply with the laws, standards, rules, principles and the Code of Auditors Ethic. In practice, we are often faced with irregularities in financial reports because of the possible frauds and errors of authorized auditors. Therefore, there must be a monitoring system whose main role is to ensure the supervision of the quality of the external audit and supervision of auditors. The European union appoints that every member country must have an established public oversight body whose responsibility is enforcing control over the audit. Since January 1, 2018, the public oversight body in Croatia is Ministry of finance which ensure the high quality of its external audit with its inspections and controls. Well-conducted supervision contributes to the consolidation of customer confidence in the financial reports and boosts the reputation of the audit profession.