An Internal Auditor Obtains Spreadsheets Created by the Finance Department

question 5

Multiple Choice

An internal auditor obtains spreadsheets created by the finance department of an organization. The internal auditor contacts a third party about the source data that was utilized to create the spreadsheets before going on to perform a ratio analysis and a comparison of budget versus actual data. What is the most likely reason that the internal auditor involved a third party before performing further analysis?

• A) To determine if a later re-performance for testing mechanical accuracy would be possible.
• B) To confirm that the spreadsheets could be used as a source of analytic data.
• C) To determine what future usage limitations the spreadsheets might have.
• D) To obtain a reliable verification about the accuracy of the source data.

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Definitions:

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Costs that cannot be influenced or changed by the actions of a specific individual or management level within the organization.

Controllable Cost

Expenses that a manager or business has the power to influence or change directly.

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