In what scenario might an organization need to conduct an external audit?

An organization may need to conduct an external audit primarily to analyze financial statements and billing records. This process involves examining the accuracy and compliance of financial statements, ensuring that they reflect the true and fair financial position of the organization. An external audit provides an objective assessment, which is essential for stakeholders, including investors, lenders, and regulatory agencies, who rely on accurate financial reporting.

Such audits help to identify discrepancies, assess the effectiveness of internal controls, and ensure adherence to relevant laws and regulations. This level of scrutiny is crucial for maintaining trust and accountability within the organization and allows for informed decision-making based on reliable financial data.

In contrast, verifying marketing strategies, assessing employee performance, and improving patient satisfaction surveys are not typical scenarios that necessitate an external audit. These areas focus on different organizational aspects that do not directly involve the financial integrity and compliance of the organization.