Explanation:

External analysis depends entirely on issued financial statements:This analysis is done by outsiders who do not have access to the detailed internal accounting records of the business firm. These outsiders include investors, potential investors, creditors, potential creditors, government agencies, credit agencies, and the general public. For financial analysis, these external parties to the firm depend almost entirely on the published financial statements. 

Interpretation and analysis both are different; Analysis suggests the application of scientific method, producing a result that is reproducible by others assessing the same data. Interpretation, on the other hand, suggests inference that is more qualitative than quantitative, engaging the analyst's creative resources, but it is more prone to subjective biases.

Financial analysis covers interpretation.the analysis and interpretation of financial statements, results in the presentation of information that aids the business managers, investors and creditor.