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ACCA Applied Knowledge · Business and Technology · Regulation and financial crime

A purchasing manager at Karlton Ltd approves orders from a supplier that gives her family holiday vouchers each year. In return, the supplier's prices are accepted without the usual competitive quotes. Which of the following best describes this situation?

This is bribery. The supplier gives holiday vouchers, an advantage, and the manager accepts them in return for skipping competitive quotes, which is improper performance of her duties. It is not money laundering, as no criminal proceeds are being concealed, and it is not acceptable hospitality because it influences a business decision.

  1. ABribery, because an advantage is given and accepted to influence a business decision improperlyCorrect
  2. BMoney laundering, because the vouchers disguise the proceeds of a criminal offence
  3. CLawful corporate hospitality, because the vouchers are not paid in cash

Explanation

Bribery involves offering, giving, requesting or accepting an advantage to induce improper performance of a function. The vouchers are given in return for bypassing competitive quotes, so this is bribery. Money laundering concerns concealing the origin of criminal proceeds, which is not described here. Hospitality is acceptable only if it is reasonable and not intended to influence a decision; here it clearly is.

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