Area II: Business Law — CPA Practice Question 12

How to approach this question

Distinguish between 'obtaining business' (bribe) and 'routine governmental action' (grease payment).

Full Answer

C.A payment to a foreign official to influence the award of a government construction contract.✓ Correct

C

The FCPA prohibits giving anything of value to a foreign official to influence an official act or decision to obtain or retain business. Option C is a classic bribe to get a contract. Option A is a 'facilitating payment' (grease payment) for routine governmental action, which is an exception. Option B is a bona fide promotional expense. Option D involves a private party, not a government official.

Common mistakes

Thinking all payments to officials are banned (grease payments are the exception).

Under the Foreign Corrupt Practices Act (FCPA), which of the following payments is most likely prohibited?

How to approach this question

Full Answer

Common mistakes

Practice the full CPA REG Practice Exam 2

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