The Internal Audit Function Is Only Effective When

question 95

Multiple Choice

The internal audit function is only effective when

• A) control tasks are properly performed.
• B) the results of an internal audit are reported to senior management and/or the company's owners.
• C) independent checks of performance are carried out on a regular basis.
• D) reports are filed with the CICA.

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Definitions:

Specialization

The process of focusing on and becoming expert in a particular area of production or knowledge to increase efficiency.

Falling Costs

A situation where the expenses associated with producing a good or service decrease, often leading to lower prices for consumers.

Economies of Scale

The cost advantage that arises with increased output of a product, where average costs start to fall as production scales up.

Marginal Returns

denotes the additional output obtained by adding one more unit of a specific input, while keeping other inputs constant.