Performing due diligence to evaluate the financial strength of the vendor as a going concern helps protect against _____.
A)Outsourcing activities that should not be outsourced
B)Selecting the wrong vendor
C)Writing a poor contract
D)Overlooking personnel issues
E)All of the above are common outsourcing mistakes

Question

Quizplus · Accepted Answer

Performing due diligence on a vendor's financial strength as a going concern helps ensure that the vendor is financially stable and able to deliver on its commitments, reducing the risk of selecting the wrong vendor. It does not directly address issues such as outsourcing activities that should not be outsourced, writing a poor contract, or overlooking personnel issues, which are separate mistakes that also require attention.

Performing Due Diligence to Evaluate the Financial Strength of the Vendor