During an Audit of an Ethics Program, Which of the Following

question 228

Multiple Choice

During an audit of an ethics program, which of the following procedures are most appropriate to evaluate the effectiveness of the program? • Testing whether corrective actions taken on involved parties breaching the ethics program are adequate. • Testing whether all employees are mandated through policy to comply with the ethics program. • Testing whether all employees are required to confirm in writing their compliance with the ethics program. • Testing through surveys employee's level of understanding and commitment to the ethics program.

• A) 1 and 2 only
• B) 1 and 4 only
• C) 2 and 3 only
• D) 3 and 4 only

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Definitions:

Payout Ratio

A financial metric indicating the proportion of earnings a company pays to its shareholders in dividends, expressed as a percentage of the company's net income.

Times Interest Earned

Times Interest Earned is a financial metric that measures a company's ability to meet its interest obligations, calculated as earnings before interest and taxes divided by interest expense.

Inventory Turnover

A ratio indicating how often a company sells and replaces its stock of goods during a period, calculated as cost of goods sold divided by average inventory.

Cost of Goods Sold

The exact costs incurred in the creation of a company’s sold goods, including the expenses for materials and labor.