What key benefit can result from conducting external audits?

Conducting external audits plays a crucial role in improving risk management effectiveness. External auditors provide an independent assessment of an organization's financial statements and internal controls. This independent analysis helps identify potential risks related to financial reporting, compliance with laws and regulations, and operational inefficiencies.

By evaluating these areas, the audit process enables organizations to address vulnerabilities and enhance their risk management frameworks. It fosters a culture of accountability and transparency, encouraging organizations to implement stronger internal controls and better governance practices. This proactive approach not only mitigates risks but also enhances stakeholder confidence in the organization.

In contrast, while external audits may indirectly support aspects like employee productivity, operational costs, or marketing strategies, these are not the primary focus or benefits derived directly from the audit process. The central aim of external audits revolves around providing insights that lead to more effective risk management.