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ACCA Applied Skills · Corporate and Business Law (Global) · Fraudulent and criminal behaviour

Kestrel Ltd, a manufacturer, pays a sum of money to a procurement officer employed by a foreign government department so that the officer will award Kestrel a supply contract that it would not otherwise win. Which description best fits this payment?

The payment is bribery of a foreign public official. Kestrel gives a financial advantage to an official intending to induce an improper award of a contract. This is not a commission, discount or social responsibility spending, because it corrupts the official's duty.

  1. ABribery of a foreign public officialCorrect
  2. BA lawful commission paid to an agent
  3. CA normal discount for bulk purchase
  4. DA facilitation of corporate social responsibility

Explanation

Giving a financial advantage to a public official to influence them in their official role and obtain business is bribery. A commission is paid to an agent for legitimate services, and a discount is a price adjustment, neither being a payment to an official to secure improper favour.

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