Identify the personnel responsible for authorizing investment decisions. State the relevance of authorizing at this level.
Explanation of Solution
Investment Decisions:
Decisions undertaken by a management to determine where the company resources should be invested to acquire or lease tangible assets and intangible assets are known as investment decisions.
The authorizing of investment activities is generally approved by the board of directors or investment committee. In most of the major investment transactions, decisions are taken by executive committee.
Decisions about investment activities are irreversible in nature and a substantial amount is involved in making investments. Due to the nature and amount involved in investment decision specific authorization by higher management of an organization is required.
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