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Which aspect should raise the highest concern for an IT auditor assessing IT outsourcing strategies?
Transfer of legal compliance responsibility
Promoting long-term contracts rather than short-term contracts
Use of only subsidiary companies for outsourcing
Lack of a cross-functional contract management team
The ultimate responsibility to comply with all applicable laws and regulations lies with the company that is outsourcing or contracting the service, not with the external service provider. Therefore, transferring such responsibility is neither feasible nor in the best interest of the company. While each of the choices may be an issue, an IS auditor should be most concerned if the strategy is to transfer an organization's legal compliance responsibility.
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