Regulator-required Corporate Compliance Program Audits

Abstract

This paper critically examines the ability of compliance program audits to provide adequate assurance of compliance system performance. The empirical evidence comes from the use of compliance program audits in monitoring compliance with enforceable undertakings agreed upon between companies (that have allegedly breached the law) and the Australian Competition and Consumer Commission and the Australian Securities and Investments Commission. The evidence suggests that the primary value of compliance program audits in this context is as a management review that induces better compliance. Nevertheless, it may be the formal regulatory expectation of verification (and the belief that it is possibl..