Which of the Following Would Not Be Considered a Benefit

question 63

Multiple Choice

Which of the following would not be considered a benefit of conducting post-implementation audits of capital investment projects?

• A) Such audits ensure the realization of future after-tax cash flows.
• B) Such audits should reduce disincentive effects associated with using one type of model for capital investment analysis (e.g., NPV) and a different model for evaluation of subsequent financial performance (e.g., ROI).
• C) Knowledge that investments are subject to post-implementation audit can counter tendencies to inflate estimates of net cash benefits associated with proposed investment projects.
• D) Such audits can help an organization achieve greater levels of goal congruence in terms of the capital budgeting process.

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Definitions:

Wealth of The Nation

A measure of the total value of all assets owned by the inhabitants of a country, including natural resources, capital goods, and human capital.

Re-expression

The process of applying a mathematical transformation to a dataset with the goal of achieving a more linear or normal distribution.

Scatterplot

A graphical representation using dots to show the relationship between two quantitative variables, helping to visualize any correlations.

Quantities X and Y

Refers to variables or values that are often used in mathematical equations or statistical models to represent data, measurements, or unknowns.