BUSINESS ADMINISTRATION
STRATEGIC MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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get an approval from the Securities and Exchange Commission
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perform an internal audit
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gather competitive intelligence and information about external trends
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hire a consultant to develop a comprehensive strategic plan
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Detailed explanation-1: -7) To perform an external audit, a company first must gather competitive intelligence and information about social, cultural, demographic, environmental, economic, political, legal, governmental, and technological trends.
Detailed explanation-2: -The auditor’s report is formed on the basis of audit procedures, which include: assessing the effectiveness of management’s internal controls over financial reporting and legal compliance. examining, on a test basis, information that provides evidence supporting the amounts and disclosures in the financial statements.
Detailed explanation-3: -The process of performing an external audit must involve as many managers and employees as possible. As emphasized in earlier chapters, involvement in the strategic-management process can lead to understanding and commitment from organizational members.
Detailed explanation-4: -Conclusion. The external audit is all about giving an opinion on the financial statements of the company. It is the most important audit for the entity, amongst the other audits. The opinion para of the audit report is the most important area in the whole audit report.
Detailed explanation-5: -The process of performing an external audit needs to include: as many managers and employees as possible. Freund emphasizes that key external factors should be all of these except: relatively few in number.