What is FCPA audit?
FCPA audits seek to determine whether people have a proper understanding of the company’s internal controls and processes; that means the interviewer should be someone who is approachable, sensitive to cultural matters, and has great communication skills.
What are the two accounting requirements imposed by the FCPA?
The FCPA has two related accounting requirements: (1) books and records; and (2) internal controls.
How do auditors respond to FCPA risk?
FCPA compliance is a top priority for the Securities and Exchange Commission and Department of Justice. In this study, we find that auditors respond to FCPA risk by increasing fees (i.e., effort), particularly as they evaluate accounts that are more likely to be involved with illegal activity.
What activities are covered by the FCPA provisions?
The FCPA has two primary provisions: (1) an anti-bribery provision which makes it unlawful for a U.S. company or citizen, and certain foreign issuers of securities, to make a corrupt payment to a foreign official for the purpose of obtaining or retaining business and (2) an accounting provision which requires companies …
Why is the FCPA important?
The FCPA allows companies to develop strong internal controls and avoid a slippery slope toward an unethical culture. Companies that regularly utilize bribes in their business operations are likely to eventually encounter multiple problems, both in the U.S. and abroad.
How does US multinational firms foreign corruption risk affect auditor behavior?
Using a sample of U.S. multinational firms from 2000 to 2014, we find that foreign corruption risk is negatively associated with audit fees and the probability of receiving a going concern opinion. Also, higher foreign corruption risk is associated with lower bankruptcy risk.
Which entity is responsible for criminal enforcement of the FCPA’s anti bribery provisions?
U.S. Department of Justice
The responsibility of FCPA enforcement lies mostly with the joint efforts of the Securities and Exchange Commission (SEC) and the U.S. Department of Justice (DOJ). These government entities, however, also rely upon the willing cooperation of international authorities and anti-bribery regulators.
Who needs to comply with FCPA?
Who Is Covered by the FCPA? The FCPA applies to two broad categories of persons: those with formal ties to the United States and those who take action in furtherance of a violation while in the United States. U.S. “issuers” and “domestic concerns” must obey the FCPA, even when acting outside the country.
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