During a Review of Performance Measures in an Organization's Purchasing

question 200

Multiple Choice

During a review of performance measures in an organization's purchasing function, the preliminary survey indicates that most of the measures have been in use for some time. The internal auditor should:

• A) Review the data that was used to develop the measures.
• B) Perform benchmarking in order to verify that the measures being used are meaningful.
• C) Establish the history of the measures and reasons for use.
• D) Report that the measures being used are out-of-date and should be improved.

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Definitions:

Uniformly Distributed

Uniformly distributed indicates that all outcomes in a data set or probability distribution have the same or nearly equal chance of occurring.

Standard Deviation

A tool to determine the degree of difference or dispersion within a batch of data.

Standard Normal

A type of normal distribution with a mean of 0 and a standard deviation of 1.

Random Variable

A numerical value variable resulting from random phenomena.