Audit Objectives in the Electronic Data Interchange (EDI)environment Include All

question 22

Multiple Choice

Audit objectives in the electronic data interchange (EDI) environment include all of the following except

• A)all EDI transactions are authorized
• B)unauthorized trading partners cannot gain access to database records
• C)a complete audit trail of EDI transactions is maintained
• D)backup procedures are in place and functioning properly

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Definitions:

Crossover Rate

The rate of return at which two projects have the same net present value; used in capital budgeting to evaluate the desirability of investments or projects.

WACC

A measure of a firm's blended cost of capital across all sources, including equity and debt.

NPV

Net Present Value is the calculation used to determine the value of future cash flows in today's dollars, subtracting the initial investment.

Multiple IRRs

Situations where a project or investment has more than one internal rate of return, occurring with alternating cash flows (positive and negative).