Which of the Following Would Be Considered the Most Significant

question 98

Multiple Choice

Which of the following would be considered the most significant problem for internal audit if the chief audit executive reported to the controller?

• A) The controller would amend the audit schedule so more audit time was spent on accounting issues.
• B) The controller may have no training as an internal auditor.
• C) During times when the budget needs to be cut, internal audit would likely be the first to lose funding.
• D) The controller can control the scope of audits and censor audit reports before being sent to management and the audit committee.

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Definitions:

Total Investment

The sum of all financial resources allocated towards a particular investment, project, or portfolio.

Price of Capital

The cost of using capital to produce goods or services, often represented by the interest rate on borrowed funds or the opportunity cost of using one's own funds.

Future Profits

Expected earnings or gains in the future, often incorporating risk and uncertainty predictions.

Interest Rate

The percentage of a sum of money charged for its use, typically expressed as an annual rate.