Explain the Federal Sentencing Guidelines for boards.
What will be an ideal response?
The Federal Sentencing Guidelines (FSG), promulgated by the United States Sentencing Commission and (since a 2005 Supreme Court decision) discretionary in nature, offer boards some specifics regarding ways to mitigate eventual fines and sentences in carrying out their duties by paying attention to ethics and compliance. In particular, the board must work with executives to analyze the incentives for ethical behavior. It must also be truly knowledgeable about the content and operation of the ethics program. "Knowledgeable" would involve a clear understanding of the process by which the program evolved its objectives, its process and next steps, rather than simply the mere contents of a training session. The FSG also suggest that the board exercise "reasonable oversight" with respect to the implementation and effectiveness of the ethics/compliance program by ensuring that the program has adequate resources, appropriate level of authority, and direct access to the board.
In order to ensure satisfaction of the FSG and the objectives of the ethics and compliance program, the FSG discuss periodic assessment of risk of criminal conduct and of the program's effectiveness. In order to assess their success, boards should evaluate their training and development materials, their governance structure and position descriptions, their individual evaluation processes, their methods for bringing individuals onto the board or removing them, and all board policies, procedures, and processes, including a code of conduct and conflicts policies. Though the above FSG recommendations seem intuitive to some extent, see the following Reality Check for the actual numbers of firms that implement training on these issues for their boards of directors.
You might also like to view...
On January 1 . 2014, Ashton Company purchased equipment at a cost of $570,000 . The equipment was estimated to have a useful life of five years and a salvage value of $60,000 . Ashton uses the sum-of-the-years'-digits method of depreciation. What should the accumulated depreciation be at December 31 . 2016?
a. $340,000 b. $408,000 c. $456,000 d. $510,000
Special pricing orders increase operating income if the special price exceeds the differential costs of filling the special order
Indicate whether the statement is true or false
In Stewart v. Federated Department Stores, where a woman's estate sued Bloomingdale's for failing to adequately guard one of the store's parking lots, the court held that the security was not negligent under the circumstances
a. True b. False Indicate whether the statement is true or false
Short surveys can be given to any party to a transaction with your business and provide an entrepreneur with the opportunity to evaluate his or her company's performance on dimensions that may lead to financial success.
Answer the following statement true (T) or false (F)