The reason to have a post-investment audit is ________.
A) they encourage mid-level managers to make overly optimistic estimates during the early stages of the capital budgeting process
B) they help alert senior management to problems in the implementation of projects
C) they analyze by calculating contribution-margin
D) they help in calculating present value

Question

Quizplus · Accepted Answer

A post-investment audit helps senior management to identify problems and issues that may have arisen during the implementation of projects. It's essential to evaluate the accuracy of initial estimates as well as actual performance to identify areas for improvement and to make necessary adjustments for future investments. The other options, such as calculating contribution margin and present value analysis, are typically part of the capital budgeting process, but they are not the primary reasons for conducting a post-investment audit.

The Reason to Have a Post-Investment Audit Is ________