15 Questions
What is the main focus of an external audit?
Identifying and evaluating trends and events beyond the control of a single firm
Which of the following is not a category of external forces according to the text?
Internal organizational forces
What is the purpose of gathering competitive intelligence and information about trends in performing an external audit?
To formulate strategies for taking advantage of opportunities and avoiding or reducing the impact of threats
Which category of external forces includes social, cultural, demographic, and natural environment forces?
Social forces
What is the purpose of revealing key opportunities and threats confronting an organization?
So that managers can formulate strategies to take advantage of the opportunities and avoid or reduce the impact of threats
What is the primary goal of identifying and evaluating external forces in an external audit?
To create strategies to take advantage of opportunities and mitigate threats
What is the first step in the process of performing an external audit according to the text?
Gathering information about economic, social, cultural, demographic, environmental, political, governmental, legal, and technological trends
Which category of external forces includes factors related to government policies and regulations?
Political, governmental, and legal forces
What is the purpose of gathering competitive intelligence and information about economic, social, cultural, demographic, environmental, political, governmental, legal, and technological trends?
To reveal key opportunities and threats confronting an organization
What is the main focus of an external audit according to the text?
Revealing key opportunities and threats confronting an organization
External audit focuses on identifying and evaluating trends and events beyond the control of a single firm ► reveals key opportunities and threats confronting an organization so that managers can formulate strategies to take advantage of the opportunities and avoid or reduce the impact of threats
External forces can be divided into five broad categories: 1. economic forces 2. social, cultural, demographic, and natural environment forces 3. political, governmental, and legal forces 4. technological forces 5. competitive forces
First, gather competitive intelligence and information about economic, social, cultural, demographic, environmental, political, governmental, legal, and technological trends. ► A final list of the most important key external factors should be communicated.
External forces can be divided into five broad categories: 1. economic forces 2. social, cultural, demographic, and natural environment forces 3. political, governmental, and legal forces 4. technological forces 5. competitive forces
The process of performing an external audit ► focuses on identifying and evaluating trends and events beyond the control of a single firm ► reveals key opportunities and threats confronting an organization so that managers can formulate strategies to take advantage of the opportunities and avoid or reduce the impact of threats
Test your knowledge on external audits and key external forces affecting organizations. Explore the impact of economic, social, cultural, demographic, and natural environmental forces on business strategies.
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