Which of the Following Is True of Engagement Recommendations

question 117

Multiple Choice

Which of the following is true of engagement recommendations?

• A) Specific suggestions for implementation must be included. II. The internal auditor's observations and conclusions may serve as the basis. III. Actions to correct existing conditions or improve operations may be included. IV. Approaches to correcting or enhancing performance may be suggested.
• B) I only
• C) III only
• D) I, III, and IV only
• E) II, III, and IV only

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Definitions:

Worst Case Scenario

the most adverse condition or outcome that can reasonably be projected.

Base Case

The default scenario in scenario analysis, used as a benchmark to compare the outcomes of alternative assumptions or actions.

NPV

Net Present Value, a calculation used to assess the profitability of an investment by summing the present values of all expected future cash flows minus the initial investment cost.

Break-even Points

The level of production or sales at which total revenues equal total expenses, resulting in no net profit or loss.