Discussion Replies-Week 4

I need a reply for two discussion posts. Needs to have in-text citations and should be approximately 2 paragraphs for each one with an open-ended question to my fellow student. This does not need a title page, and one reference is sufficient per reply. Please make sure there is an open-ended question at the end.

Question: The Role of the Audit Committee

How does the audit committee help with the long-term value of a corporation? Has the audit committee been given too much responsibility to protect shareholder interest? What are some of the ways the audit committee protects the company against litigation?

Student: Roberta!

The Audit Committee oversees the performance of the internal auditors (independence and qualifications), identifies non-compliance with legal and regulatory requirements, assures the integrity of the company’s financial statements and internal controls, and reviews the risks with senior management. The Audit Committee acts as a facilitator between the board, external auditors, and internal auditors.

I don’t think that the Audit Committee has been given too much responsibility to protect shareholder interest. However, the Board might rely too heavily on the Audit Committee to oversee and monitor management.

The Audit Committee acts as a watchdog which limits the exposure of the board against litigation by providing a preponderance of the evidence that suggests the board exercised due care in carrying out its obligations. Act in good faith to ensure the adequacy of the corporate reporting, control and information systems which limits the incentive to commit financial fraud. The audit committee must make available to employees the chance to bring forward confidential and anonymous concerns regarding dubious accounting or auditing concerns. The Sarbanes-Oxley Act shields whistleblowers at public companies by permitting statutory rights to informants and enforcing criminal penalties for striking back against informants.

Reference

Hansye, Y. K. (2012). The audit committee: A gatekeeper for effective corporate governance (Master’s Thesis). Social Science Research Network. Retrieved from:http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2179389

Audit Committee Resource Guide. (2015). Deloitte.

Tuttle, B (2016). Why the Epi pen price scandal sums up everything we hate abou big business & politics. Retrieved from http://time.com/money/4502891/epipen-pricing-scandal-big-pharma-politics/ (Links to an external site.)Links to an external site.

Question: Show Me the Money!

You are a member of the compensation committee for a large corporation that is searching for a new CEO. It is your task to establish the compensation package that includes salary, bonuses and other incentives as a way to attract the best and brightest talent. Let’s discuss how you would justify (or not) such a large compensation package?

If your last name begins with A – M: Present an argument for an attractive compensation package. Be sure to support your argument with specific examples.

If your last name begins with N – Z: Present an argument against such a large compensation package. What are the risks involved? Be sure to support your argument with specific examples.

Student: Tara H!

Several reasons become apparent as to why it is vital to offer an attractive compensation package. The does not want to take the chance of losing potential star quality employees to another company. Additionally, by not providing this package an individual might be discouraged from this company, and seek other avenues for employment. McDonald (2017) stated, “above-average salaries are often the key to attracting and retaining top performers.” In today’s economy, benefits often become as important as the offered dollar amount. Often this becomes the ultimate decision maker for the person. Jones (2017) noted that results from Glassdoor’s 2015 Employment Confidence Survey showed “about 60% of people report that benefits and perks are a major factor in considering whether to accepts a job offer.” Additionally, “80% of employees would choose additional benefits of a pay raise” (Jones, 2017). These results become an excellent argument regarding the importance of offering an attractive compensation package.

By adequately compensating the employees, the company sees an increases motivation with the staff. The employees feel important and valued. Ultimately, the morale of the organization increases delivering stronger results (McDonald, 2017). When employees are happy, they tend to show more loyalty to the organization. Therefore, the company can expect to spend less “less money and energy on recruiting new candidates” (McDonald, 2017). An attractive compensation package can also provide the individual with a sense of job satisfaction. With a beautiful compensation package, the appeal for the organizations grows amongst individuals in search of a new place of employment. Additionally, the company can expect to see stronger employees and experience a lower turnover rate.

References

Jones, K. (2017). The most desirable employee benefits. Harvard Business Review. Retrieved from

https://hbr.org/2017/02/the-most-desirable-employee-benefits (Links to an external site.)Links to an external site.

McDonald, P. (2017). 4 elements of a winning compensation package. CPA Practice Advisor.

Retrieved from http://www.cpapracticeadvisor.com/article/12307331/4-elements-of-a-winning- (Links to an external site.)Links to an external site.

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