Internal and external audit

Yes, they often will. Often external auditors do no do this as a matter of course or unless the regulations are to do with tax or the presentation of the financial statements. For example, it would be very difficult for external auditors to ensure their client complied with health and safety regulations or ensuring that employees had the qualifications needed before they could carry out tasks legally or that a company had complied with competition law. Of course, if the external auditors happened upon breaches this would be reported to management and they would also assess if there was a material impact on the financial statements. Internal auditors, on the other hand, have much more specialist knowledge about their company and might well be asked to review compliance with laws and regulations.