Which of the following statements about benchmarks is TRUE?
A)They may be financial or nonfinancial.
B)They are used to compute variances.
C)Broad benchmarks have more relevance.
D)Obtaining benchmarks has no legal or ethical issues.
E)Benchmarks are the main driver of strategic planning.

Question

Quizplus · Accepted Answer

Benchmarks can be financial (e.g. comparing financial ratios) or nonfinancial (e.g. comparing employee satisfaction scores). Option B is not entirely true as benchmarks can be used to compute variances but that is not their only purpose. Option C is subjective as the relevance of a benchmark depends on the industry and context. Option D is false as obtaining benchmarks can have ethical and legal implications, such as confidentiality and potential antitrust concerns. Option E is also false as benchmarks are only one of several factors that drive strategic planning.

Which of the Following Statements About Benchmarks Is TRUE