ACCA Performance Management (F5) Certification Practice Exam

Which of the following is a benefit of investing in a new information system?

1. Decreased processing capacity

2. Enhanced processing efficiency

3. Inability to store large amounts of data

4. Slower data retrieval

The correct answer is: Enhanced processing efficiency

Investing in a new information system typically leads to enhanced processing efficiency. This improvement is critical as modern information systems are designed to streamline processes, automate repetitive tasks, and optimize workflows, which can significantly reduce the time and resources required to complete tasks. Enhanced processing efficiency allows organizations to handle larger volumes of transactions with greater accuracy and speed. As a result, businesses can respond more rapidly to customer needs, make informed decisions based on timely data, and ultimately gain a competitive advantage in their industry. The other options refer to potential drawbacks or limitations that would not be expected outcomes of a successful investment in an information system. For instance, decreased processing capacity and slower data retrieval would hinder operations rather than improve them, making them unfavorable characteristics of a system. Additionally, the inability to store large amounts of data would limit an organization's ability to accumulate and analyze valuable information, which is contrary to the purpose of upgrading to a new information system.