Which of the Following Is a Key Performance Indicator for an Internal

question 218

Multiple Choice

Which of the following is a key performance indicator for an internal audit function?

• A) Audit expenditures compared to financial budgets.
• B) Percent of required continuing education hours completed.
• C) Implementation of new audit computer software.
• D) Frequency of meetings with the board members.

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Definitions:

Cost of Equity

The theoretical earnings paid by a business to its equity holders as compensation for the risk they take by investing.

Preferred Stock

A class of ownership in a corporation that has a higher claim on its assets and earnings than common stock, often paying fixed dividends.

Tax Rate

The share of earnings upon which a person or corporation is taxed.

Market Risk Premium

The Market Risk Premium refers to the extra yield an investor anticipates receiving for investing in a volatile market portfolio over risk-free securities.