CFS Corporate Governance & Whistleblower Programs Flashcards
6 cards from real CFS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 CFS Corporate Governance & Whistleblower Programs flashcards as text
Under the Dodd-Frank Act, the SEC Whistleblower Program awards qualifying whistleblowers what percentage of sanctions collected?
Answer: 10–30%
The SEC Whistleblower Program awards qualifying individuals between 10% and 30% of monetary sanctions exceeding $1 million collected in enforcement actions.
Which SOX section protects employees of publicly traded companies who report fraud from retaliation?
Answer: Section 806
SOX Section 806 prohibits publicly traded companies from retaliating against employees who provide information about potential securities fraud to regulators or supervisors.
An anonymous hotline is most effective as a fraud detection tool because:
Answer: Employees are more likely to report suspicions when protected from retaliation
Anonymous hotlines reduce the fear of retaliation, making employees significantly more willing to report observed fraud or misconduct, which is the most common fraud detection method.
Which element is essential for a whistleblower program to be effective?
Answer: Guaranteed confidentiality and non-retaliation protections
Effective whistleblower programs must guarantee confidentiality and clearly communicate non-retaliation policies to encourage good-faith reporting without fear of consequences.
Which internal governance body typically has direct oversight of a company's internal audit function?
Answer: The audit committee of the board
The audit committee of the board oversees the internal audit function to ensure its independence from management and alignment with governance and risk objectives.
An organization's ethics hotline received a tip about an executive's expense fraud. Who should typically investigate this allegation?
Answer: Internal audit or a designated fraud investigation team independent of the accused
Allegations against executives should be investigated by parties independent of the accused, such as internal audit, legal counsel, or external forensic accountants, to avoid conflicts of interest.