Certified Internal Auditor (CIA) Part 3: Business Knowledge for Internal Auditing — Question 237

Which of the following is a result of implementing an e-commerce system, which relies heavily on electronic data interchange and electronic funds transfer, for purchasing and billing?

Answer options

• A. Higher cash flow and treasury balances.
• B. Higher inventory balances.
• C. Higher accounts receivable
• D. Higher accounts payable.

Correct answer: A

Explanation

Implementing an e-commerce system that utilizes electronic data interchange and electronic funds transfer can streamline transactions, leading to improved cash flow and higher treasury balances. The other options, such as higher inventory balances, accounts receivable, or accounts payable, do not directly correlate with the efficiencies gained through such systems.