Chimneys can be made of brick or wood. The flue keeps the gasses of the furnace, water heater, or fireplace from getting in contact with the chimney.https://www.thehomeinspectors.com/wp-content/uploads/2019/04/img_5198.mov
The above video shows that the visible clay tile flue liners are only above the chimney. We do what we can to view inside the flue liner to find gaps, cracks, or other defects. This particular chimney was deteriorated in a few different ways. First we have no crown on top of the chimney. A good crown will be a solid piece of concrete creating a water proof lid for the chimney. This chimney has (what I call) a tar slush coat. This tar will work for about a year, then the UV rays from the sun dry out the tar and cause it to crack. Then the water will enter the brick and damage the chimney.
This chimney is in pretty bad shape and needs quite a bit of work done to it to make it safe. This is not the type of items we should ignore. Everything from Carbon Monoxide entering the building to fires starting.