In the United States, the Foreign Corrupt Practices Act (FCPA) is a legacy of the Watergate scandal during Richard Nixon's presidency
Administered by the Department of Justice and the Securities and Exchange Commission, the act is concerned with disclosure and prohibition. What is this law concerned with, and why is it a subject of criticism by many?
The act concerns disclosure and prohibition. The disclosure part of the act required publicly held companies to institute internal accounting controls that would record all transactions. The prohibition part makes it a crime for U.S. corporations to bribe an official of a foreign government or political party to obtain or retain business. Payments to third parties were also prohibited when they can be channeled to some related official as a bribe. Some critics of the FCPA feel strongly that this act is a sort of regrettable display of moral imperialism. The problem is the extra-territorial extension and sovereignty of U.S. law. To impose U.S. laws, standards, values, and mores on American companies and citizens worldwide is considered wrong. A second criticism of the FCPA is that it puts U.S. companies in a difficult position vis-à-vis foreign competitors. It is perceived that the act adversely affects U.S. businesses overseas. Bribes offered by non-U.S. companies are considerable and can provide a competitive advantage to other companies.
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Burns, when discussing leadership in the context of what is now termed transformational leadership, ______.
A. found motivation in followers rarely existed B. found leaders to be interested mainly in the bottom line C. tried to link the roles of leadership and followership D. tried to link the roles of in-group members to leadership outcomes
Forman Corporation extends credit to its customers to purchase appliances, furniture, and other goods. Forman Corporation could borrow from a bank using its accounts receivable as collateral, thereby placing debt on the balance sheet. Forman Corporation would then use the cash collections from the receivables to repay the bank loan with interest. Instead, Forman Corporation sells the accounts
receivable to the bank for an amount that is less than the cash the bank expects to collect from receivables purchased. The amount takes account of expected defaults, which would reduce the cash generated by the receivables. This difference between the amount paid to Forman Corporation by the bank for the receivables and the amount that the bank expects to collect from the receivables provides the bank with its expected return. Which of the following is/are true? a. Forman Corporation has no further obligation and will treat this transaction as a sale, with no incremental debt on the balance sheet and recognizing bad debt expense on the income statement. b. Forman Corporation has further obligations and will treat this transaction as a financing arrangement, recognizing bad debt expense on the income statement. c. Forman Corporation has further obligations and will treat this transaction as a financing arrangement, recognizing incremental debt on the balance sheet. d. Forman Corporation has no further obligation and will treat this transaction as a sale, with no incremental debt on the balance sheet. e. Forman Corporation has further obligations and will treat this transaction as a financing arrangement, recognizing incremental debt on the balance sheet and recognizing bad debt expense on the income statement.
Identify and briefly discuss at least two examples of faulty oversight by a company's board of directors in corporate governance and/or the strategy-making, strategy-executing process.
What will be an ideal response?
An advantage of offering lenient credit terms is that it can help a firm:
A. decrease its debt. B. increase its sales. C. reduce its riskassociated with financial leverage. D. improve cash flows from an investment.