Business Law and Legal Procedures

Purpose of Course  showclose

When most people think about business, the relationship between business and the law may not be the first consideration that comes to mind.  Bus the law has a major impact on the operation of a successful business.  For example, businesses face a range of government legal regulations, from laws preventing employment discrimination to rules requiring efforts to protect the environment.  In addition, businesses must make important legal decisions from their founding, such as which organizational form they will take, how they will conduct their daily operations (such as making contracts and protecting consumers), and how their potential liquidation will be handled.  Both business administrators and business-law paralegals must familiarize themselves with the range of laws surrounding business as well as the range of operational practices that businesses must implement in order to address the legal challenges of running a company.

This course will introduce you to the legal knowledge and skills that business administrators and paralegals must possess.  First, you will explore the basics of the American legal system and examine the specific areas of business practice that the law impacts and regulates – such as torts, contracts, and criminal action.  Then, you will practice important skills related to these areas, such as learning how to draft basic legal documents, make registrations and other filings, and communicate legal and regulatory requirements to company executives and employees.  By the time you have completed this course, you will understand the key legal aspects of operating a business, as well as the foundational skills that certain employees must possess in order to address the legal and regulatory issues that are faced by today’s businesses and companies.

Course Information  showclose

Welcome to PRDV205: Business Law and Legal Procedures.  Below, please find general information on this course and its requirements.

Course Designer: Kevin Moquin

Primary Resources: This course makes primary use of the following openly licensed textbooks.  You may download the full versions of these textbooks in PDF form via the links provided below, or you may access the individual chapters as they are assigned and linked to within resource boxes throughout this course.

Reading: The Legal and Ethical Environment of Business

Link: The Legal and Ethical Environment of Business (PDF)

Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.


Reading:Corporate Governance

Link: Corporate Governance (PDF)

Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.


Reading:Foundations of Business Law and the Legal Environment

Link: Foundations of Business Law and the Legal Environment (PDF)

Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

Requirements for Completion: In order to complete this course, you must work through each unit and complete all course readings and assignments.  In addition, you must complete any activities that are required within individual resource boxes.

Note that you will only recieve an official grade on your Final Exam.  However, in order to adequately prepare for this exam, you will need to complete all course assignments.

In order to pass this course, you will need to earn a 70% or higher on the Final Exam. Your score on the exam will be tabulated as soon as you complete it.  If you do not pass the exam, you may take it again.

Time Commitment: This course should take you approximately 30 hours to complete.  Each unit includes time advisories that list the amount of time you are expected to spend on each subunit.  These time advisories should help you plan your coursework accordingly.  You may want to use these time advisories to determine how much time you have over the next few weeks to complete each unit, and then set your unit- and course-completion goals accordingly.

Tips/Suggestions: As you work through the course material, be sure to take careful notes.  These notes will help you to retain new information and synthesize ideas.  In addition, consider outlining topics as you come across important or complex concepts within the readings.  Lastly, be sure to review all the exercises included in the readings, and to work through and complete any exercises that are required within each subunit.

Learning Outcomes  showclose

Upon successful completion of this course, you should be able to:
  • describe the interaction between the separation of powers and federalism within the US government;
  • describe how US law relates to business;
  • describe the US court system;
  • explain and describe the trial process;
  • identify major forms of alternative dispute resolution;
  • identify common business organizations;
  • complete a state filing for a business organization;
  • explain how a contract can be formed and breached;
  • draft a basic contract;
  • explain the operation of the Uniform Commercial Code (UCC) with regard to the sale of goods, negotiable instruments, and secured transactions;
  • complete a state Uniform Commercial Code filing;
  • identify and describe important laws governing the employment relationship;
  • identify real and personal property and distinguish between the two;
  • identify the major forms of intellectual property;
  • identify and describe the major categories of torts;
  • assess the impact of crime on business;
  • assess the impact of government regulation on business;
  • analyze basic compliance programs and apply program policies to real-world situations; and
  • critically review and explain ethical and regulatory compliance policy programs

Course Requirements  showclose

In order to take this course, you must:

√    have access to a computer;

√    have continuous broadband Internet access;

√    have the ability and permission to install plug-ins and/or software (e.g., Adobe Reader or Flash);

√    have the ability to download and save files and documents to a computer;

√    have the ability to open Microsoft Office files and documents (.doc, .ppt, .xls, etc.); and

√    have competency in the English language.

Unit Outline show close


Expand All Resources Collapse All Resources
  • Unit 1: AN OVERVIEW OF THE LAW AND BUSINESS  

    This unit introduces you to the foundations of law in the United States and provides you with an overview of how various US laws can affect the operation of American businesses.  The unique US legal system, which combines the principles of separation of powers with those of federalism, has shaped the development of law and policy in the United States throughout the past 200 years. The three branches of the federal government – the US president, or executive branch; the US Congress, or legislative branch; and the federal courts, or judicial branch – each have separate powers that the other two branches may not influence (a system known as “checks and balances”).  For example, federal judges are given lifetime appointments and cannot be removed by the president or Congress without an impeachment trial.  The separation of powers between the federal and state governments also shapes the legal process.  Add to these diverse relationships the existence of laws at the regional, county, and local levels, and you can see that businesses must deal with an extensive multitude of various bodies of law.

    Following your introduction to the American legal system, you will learn about the theoretical and legal background of business regulation in the United States.  Commerce in the US, as in most countries, operates under a presumption that the rule of law will guide the actions of businesses and their leaders, particularly with regard to the regulation of professional relationships, company disputes, and the exercise of rights.  In this unit, you will explore the impact of the rule of law on US businesses and gain an overview of several important laws that regulate companies in the United States.

    Unit 1 Time Advisory   show close
    Unit 1 Learning Outcomes   show close
  • 1.1 Key Aspects o fthe American System of Law  
  • 1.1.1 The Separation of Powers  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 5, Section 1: Federalism and Preemption"

      Link: The Legal and Ethical Environment of Business: “Chapter 5, Section 1: Federalism and Preemption" (PDF)

      Instructions: Read Section 1 from Chapter 5 of the textbook. Focus on this section’s discussion of the separation of powers within the United States government.  When the idea of separation of powers was introduced in 1789, the concept was considered revolutionary because, unlike other governmental models, it ensured that the three branches of the American federal government – the legislative, executive, and judicial wings – would check and balance each other’s duties, scope, and powers.  This concept has had a critically important impact on American law, particularly with regard to the powers, size, and functions of the federal judicial branch.  Today, an independent judiciary is considered a critical component of a true system of justice.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 1.1.2 Federalism  
    • Lecture: YouTube: The Saylor Foundation Channel: Dr. Patrick Scott’s “Federalism I” and “Federalism II”

      Link: YouTube: The Saylor Foundation Channel: Dr. Patrick Scott’s “Federalism I” (YouTube) and “Federalism II” (YouTube)

      Instructions: Click on the two links above and watch both videos.  Dr. Scott’s lectures provide a more in-depth discussion of federalism and its impact on US law.  Note that other contemporary democratic countries, such as Canada and Germany, also have federal systems of government.

      Watching these videos and pausing to take notes should take approximately 1.5 hours.
       
      Terms of Use: The material above has been reposted by the kind permission of Dr. Patrick Scott of Missouri State University, and can be viewed in its original form here.  Please note that this material is under copyright and cannot be reproduced in any capacity without explicit permission from the copyright holder.

  • 1.2 How Does Law Relate to Business  
  • 1.2.1 Business in a Law-Based Society  
  • 1.2.2 An Overview of Laws Affecting Business  
  • Unit 2: THE COURTS AND LITIGATION  

    A system of justice requires a process for justice.  In general, that process is available through the court system.  In this unit, you will learn about the basics of the American court system, which has its foundation in a network of trial courts that address disputes surrounding disagreements over facts and how the law applies to those facts.  If a party decides that the outcome of a trial is unsatisfactory, that party may decide to appeal the trial court's decision via an appeals court.  The American judicial system also provides for intermediate courts of appeal, state supreme courts, and one ultimate decider, the US Supreme Court.  A decision by a federal court of appeals or state supreme court may be appealed further to the US Supreme Court, but any legal issues decided by the Supreme Court may not be appealed further.  As a business professional, you will need to possess a working understanding of how this judicial process works and how the network of state and federal courts affects your work in the business world.

    In general, legal problems between private parties can be addressed in two basic ways – through the courts or through less-formal legal alternatives.  In this unit, you will explore the process of litigation as well as other effective methods of handling conflicts.  These alternative methods are known as alternative dispute resolution, or ADR.  Going to court is usually an expensive and time-consuming prospect, and businesses are always looking for ways to more effectively manage costs and other resources.  As such, businesses attempt to conserve both money and other assets by first considering ways to resolve disputes other than formal legal processes.  For example, before going to court over the failure of a contractor to properly install equipment for a business, the business might first consider entering into informal negotiations with the installer in order to reach a conclusion that is satisfactory to both sides.  If this attempt fails, the business might propose the use of a mediator to reach a mutually beneficial result.  Often, business contracts contain a provision requiring issues to be submitted to arbitration that is run by a non-governmental official or an organization that acts, in essence, as a judge and jury in the matter.  If these efforts fail or it is apparent that ADR is unworkable from the beginning, then a business needs to consider whether a dispute is best resolved in a court, with all of a court’s formal requirements and protections.

    In this unit, you will examine the process by which businesses litigate disputes.  You will consider who is involved in litigation and what procedural requirements must be met in order to successfully litigate a dispute.  You then will explore the various methods of ADR that are available to businesses, and consider how these methods may be used effectively to deal with disputes.

    Unit 2 Time Advisory   show close
    Unit 2 Learning Outcomes   show close
  • 2.1 The American Court System  
  • 2.1.1 Jurisdiction  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 2, Section 3: Trial and Appellate Courts”

      Link: The Legal and Ethical Environment of Business: “Chapter 2, Section 3: Trial and Appellate Courts” (PDF)

      Instructions: In Section 3 of Chapter 2, you will learn background information about the jurisdiction of various courts in the United States.  The US judicial system involves complex webs of jurisdiction.  For example, some courts can hold trials, while other courts may only hear appeals from earlier trial court decisions.  In some situations, a case must be brought first to a state court; in other situations, it must be brought directly to a federal court.  In addition, some courts have broad jurisdiction, while others possess only limited jurisdiction.  This textbook section will lay out these basic differences in more detail.

      Note that this reading also covers the material you need to know for Subunit 2.1.2, found below.  You can refer to that subunit for additional guidance on how to approach this reading.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 2.1.2 Trial Courts  

    Note: This topic is covered by the Chapter 2, Section 3 textbook reading assigned under Subunit 2.1.1 (above).  For this subunit, focus on the textbook’s discussion of trial courts in the United States.  Note that at the federal level, trial courts are represented by district courts whose jurisdiction is limited by factors such as whether a federal law is involved, whether the parties are from different states, and (in the case of a civil trial) the amount of money involved.  In addition, all fifty states have their own court systems, with their own trial and appellate courts.  As you review this material, be sure to familiarize yourself with the limits and powers of various types of courts, as well as the types of interaction between state and federal courts.

  • 2.1.3 Appeals Courts  
  • 2.2 Litigation  
  • 2.2.1 Initiating a Case  
  • 2.2.2 Discovery  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 3, Section 3: Pretrial Procedures”

      Link: The Legal and Ethical Environment of Business: “Chapter 3, Section 3: Pretrial Procedures” (PDF)

      Instructions: Read Chapter 3, Section 3 of the textbook.  Litigation is a complex and time-consuming activity.  Before the parties even get to trial, there is a great deal of preparation that the parties must undertake before their day in court.  In this reading, you will learn about the preparation of documents and the exchange of information that are required in order to bring a lawsuit.  You also will explore the concept of class-action lawsuits and the legal process known as discovery.

      Note that this reading also covers the material you need to know for Subunit 2.2.3, found below. You can refer to that subunit for additional guidance on how to approach this reading.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 2.2.3 Pre-Trial Motions  

    Note: this topic is covered by the Chapter 3, Section 3 textbook reading assigned under Subunit 2.2.2 (above).  For this subunit, focus on reviewing the different bases on which a party may make a motion to dismiss a case in court.  Also review the role of affidavits in the submission of motions.

  • 2.2.4 Trial and Appeal  
  • 2.3 Alternative Dispute Resolution  
  • Unit 3: BUSINESS ORGANIZATIONS  

    Corporations are legal entities that protect shareholders from certain legal liabilities.  For example, if you start a sole proprietorship and take out a small business loan to get started, you are personally liable for that loan.  If you do not repay the loan, the bank providing the loan can pursue the seizing of your personal assets.  If you are a shareholder in a corporation that fails to pay its loans, however, the bank providing the loan cannot pursue your personal assets.

    The operation of a corporation faces certain restrictions and caveats.  For example, corporations are subject to more regulations and fees than most other business entities.  However, the corporate form is only one of many types of business organization that are available to a modern company.  In this unit, you will explore the various types of business entities in the United States, weigh the pros and cons of each, and consider the issues of liability and tax consequences as they relate to these entities.

    Unit 3 Time Advisory   show close
    Unit 3 Learning Outcomes   show close
  • 3.1 Forms of Business Organization  
  • 3.1.1 Sole Proprietorships  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 11, Section 1: Sole Proprietorships”

      Link: The Legal and Ethical Environment of Business: “Chapter 11, Section 1: Sole Proprietorships” (PDF)

      Instructions: Read Chapter 11, Section 1 of the textbook.  Sole proprietorshipsare the most common form of business organization, with good reason: There are no formal requirements to start a sole proprietorship.  As you read this section, consider the other advantages of starting a business as a sole proprietorship.  (Also note the disadvantages of this type of business organization.)  Be sure to click on the hyperlink inside the box titled “Hyperlink: Small Businesses Squeezed as Banks Limit Lending” to gain insight into the challenges of borrowing money as a sole proprietor.  Also be sure you understand the issue of liability in sole proprietorships, as this discussion will provide you with a foundation for future course discussions on limited liability forms of organization.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 3.1.2 Partnerships  
  • 3.1.3 Corporations  
  • 3.1.4 Limited Liability Companies  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 11, Section 4: Limited Liability Entities”

      Link: The Legal and Ethical Environment of Business: “Chapter 11, Section 4: Limited Liability Entities” (PDF)

      Instructions: Read Section 4 from Chapter 11 of the textbook.  Limited liability companies (LLCs) are a relatively new form of business organization in the United States, but they are already used widely, particularly by small businesses.  In contrast with the many formalities and structural limitations required of corporations, LLCs offer a simpler alternative that is more suited to small businesses.  An LLC can have a single member or multiple members, and the registration and administrative requirements for these businesses are much less complicated than those for corporations.  Note, in particular, the similarities and differences among LLCs, sole proprietorships, and corporations.  Why do you think the textbook refers to LLCs as a “hybrid” entity?  Make sure you familiarize yourself with the requirements that must be met to form and organize an LLC.  Following your reading, complete the two exercises below the “Key Takeaways” box at the end of the section.

      Note that this reading also covers the material you need to know for Subunit 3.1.5, found below.  You can refer to that subunit for additional guidance on how to approach this reading.

      Reading this textbook section and completing the exercises should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 3.1.5 Other Limited Liability Organizations  

    Note: This topic is covered by the Chapter 11, Section 4 textbook reading assigned under Subunit 3.1.4 (above).  For this subunit, focus on reviewing the discussion of limited liability partnerships (LLPs) within the last paragraph of the section.  Note that LLPs are organizations that provide limited liability and tax advantages to professional partnerships such as law firms and accounting firms.

  • 3.2 State Business Registration Filing  
  • Unit 4: CONTRACTS  

    Contracts come in all shapes and sizes and appear in many aspects of daily life.  For example, you enter into a contract with a broker and/or seller when you purchase a house.  If you seek reliable work done to improve your new house, you enter into a contract with a construction contractor or a general contractor (hence the name).  In the larger business world, companies enter into contracts with other businesses in order to set prices and solidify relationships.

    Contracts are legally binding relationships.  In most circumstances, a contract involves an agreement to deliver a specific product or service at a specified time on a specified date.  Violating a contract can result in a lawsuit or a settlement.  While courts may be involved in this resolution process, such disputes may also be settled outside the judicial system.  Laws regarding contracts vary from state to state, so it is always important for you to know the contract law in your area.  This unit will discuss contracts with a focus on what is known as the common law, which is the traditional approach to contracts that has been developed since the late 1700s by English and American judges.  By the end of this unit, you should have a general familiarity with how most contracts are written and enforced, particularly under the common law.

    Unit 4 Time Advisory   show close
    Unit 4 Learning Outcomes   show close
  • 4.1 Contracts: A Case Study  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 6, Introduction"

      Link: The Legal and Ethical Environment of Business: “Chapter 6, Introduction” (PDF)

      Instructions: Read the introduction to Chapter 6 of the textbook.  This reading discusses a real contract case involving the actors and directors Clint Eastwood and Sondra Locke, and the film studio Warner Bros.  Take some time to think about this case and how it compares with your own understanding of what a contract is.  Also consider the legal consequences of breaking a contract, as well as the ethical implications.  Lastly, as you review this reading and the readings to follow, be sure to remember that the subject matter of a contract must not be illegal (for example, a contract for the sale of illegal drugs) in order for the contract to be valid.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 4.2 The Elements of a Contract  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 6, Section 1: Formation"

      Link: The Legal and Ethical Environment of Business: “Chapter 6, Section 1: Formation” (PDF)

      Instructions: Read Chapter 6, Section 1 of the textbook.  Focus on the definition of a bilateral contract and make sure you can distinguish a bilateral contract from a unilateral contract.  In addition, make sure to familiarize yourself with the specific elements that are required to form a valid common-law contract.  Lastly, acquaint yourself with the differences between common-law contracts and contracts formed under the Uniform Commercial Code, or UCC.  Following your reading, complete the three exercises below the “Key Takeaways” box at the end of the section.

      Note that this reading also covers the material you need to know for subunits 4.2.1-4.2.4, found below.  You can refer to those subunits for additional guidance on how to approach this reading.

      Reading this textbook section and completing the exercises should take approximately 1 hour.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 4.2.1 Offer and Acceptance  

    Note: this topic is covered by the Chapter 6, Section 1 textbook reading assigned under Subunit 4.1 (above).  For this subunit, review how the important concepts of offer and acceptance give rise to mutual assent in the formation of a contract

  • 4.2.2 Consideration  

    Note: This topic is covered by the Chapter 6, Section 1 textbook reading assigned under Subunit 4.1 (above).  For this subunit, focus on reviewing the role of the “bargained-for exchange” in the formation of a contract.

  • 4.2.3 Legal Purpose  

    Note: This topic is covered by the Chapter 6, Section 1 textbook reading assigned under Subunit 4.1 (above). For this subunit, note the importance of a lawful purpose in the creation of a valid contract.

  • 4.2.4 Legal Capacity  

    Note: This topic is covered by the Chapter 6, Section 1 textbook reading assigned under Subunit 4.1 (above).  For this subunit, ask yourself who has the legal capacity to form a contract and who does not.  Make sure you have a solid understanding of this distinction by the end of your reading.

  • 4.2.5 Drafting a Contract  
    • Activity: The Saylor Foundation’s “Draft a Basic Contract”

      Link: The Saylor Foundation’s “Draft a Basic Contract” (PDF)

      Instructions: In this activity you will draft a valid, effective contract.  Please keep in mind all the elements covered in Subunit 4.2, above, that need to be considered when making an effective contract.  Also be sure to include all the important terms that are specified for the contract that is given in this activity’s example scenario.  Once you have completed your draft, use this rubric to assess your work.

      Completing this activity should take approximately 30 minutes.

  • 4.3 Termination and Breach  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 6, Section 2: Performance and Discharge, Breach, Defenses, Equitable Remedies"

      Link: The Legal and Ethical Environment of Business: “Chapter 6, Section 2: Performance and Discharge, Breach, Defenses, Equitable Remedies” (PDF)

      Instructions: Read Chapter 6, Section 2 of the textbook.  Once a contract is formed and the parties are bound by that contract, the parties generally have a legal obligation to perform according to the terms of the contract.  Be sure you understand when the performance required is only substantial, versus when the performance is characterized as strict performance.  Also note the distinction between the prevalent reasonable person standard and the less-common contractual standard of personal satisfaction.  While one party's breach of a contract may result in damages, that party may also have defenses against such a claim.  Make sure you understand these defenses. Lastly, focus on the remedies that are available to a party that is the victim of a breach.  When you are finished reading, complete the two exercises below the “Key Takeaways” box at the end of the section.

      Note that this reading also covers the material you need to know for subunits 4.3.1 and 4.3.2, found below.  You can refer to those subunits for additional guidance on how to approach this reading.

      Reading this textbook section and completing the exercises should take approximately 1 hour.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 4.3.1 Breach  

    Note: This topic is covered by the Chapter 6, Section 2 textbook reading assigned under Subunit 4.2 (above).  For this subunit, focus in particular on reviewing hte portions of the reading that address the concept of breach.  Note that there are different kinds of breach, and that each type of breach has a different consequence.

  • 4.3.2 Remedies and Damages  

    Note: This topic is covered by the Chapter 6, Section 2 textbook reading assigned under Subunit 4.2 (above).  There are various remedies available to a non-breaching party when a contract is breached.  As you review this reading, be sure to familiarize yourself with these remedies.  Note that the awarding of monetary damages is only one kind of remedy, and that this option may not be available in every instance.

  • 4.4 Assignment and Delegation  
  • 4.4.1 Assignment  

    Note: This topic is covered by the Chapter 6, Section 3 textbook reading assigned under Subunit 4.3 (above).  In addition to familiarizing yourself with the ways that contracts can be assigned, be sure you are able to identify the circumstances in which a contract cannot be assigned.

  • 4.4.2 Delegation  

    Note: This topic is covered by the Chapter 6, Section 3 textbook reading assigned under Subunit 4.3 (above).  As with the process of assignment, there are circumstances in which a party's duties under a contract cannot be delegated.  Note in particular the restrictions that may apply to situations in which personal performance is intended.

  • Unit 5: NEGOTIABLE INSTRUMENTS AND SECURED TRANSACTIONS  

    The UCC addresses two very important areas in modern trade and commerce – the transfer of money by way of documents that guarantee payment, and the recording of interests in property serving as security for a loan.  Most of us are familiar with one kind of negotiable instrument – checks.  Every day, individuals and businesses pay vendors by way of check or draft.  Behind these transactions is an extensive body of law to ensure the orderly transfer of money.  In addition to checks, promissory notes are also used to guarantee repayment of loans.  Likewise, laws governing secured transactions provide a framework for interpreting contracts that provide for collateral on loans and allow a process for recording such contracts so that creditors are put on notice regarding earlier collateral interests.  For example, you might get a loan on a new car, for which the car serves as collateral.  Insuring contracts for payment of money in commercial transactions helps to provide for a stable and reliable system of commerce.

    Unit 5 Time Advisory   show close
    Unit 5 Learning Outcomes   show close
  • 5.1 Negotiable Instruments  
  • 5.1.1 An Overview of Negotiable Instruments  
  • 5.1.2 Types of Negotiable Instruments  
  • 5.1.2.1 Drafts and Checks  

    Note: This topic is covered by the Chapter 22, Section 2 textbook reading assigned under Subunit 5.1.2 (above).  In addition to understanding what drafts and checks are, make sure you are able to identify the parties to a draft or check.  Also note the importance of drafts in trade and commerce, and be sure you understand the various kinds of drafts and checks.

  • 5.1.2.2 Notes  

    Note: This topic is covered by the Chapter 22, Section 2 textbook reading assigned under Subunit 5.1.2 (above).  For this subunit, be sure to familiarize yourself with the definition of and the parties to a promissory note in the brief section titled “Notes” on page 780.  If you have ever received a loan from a bank or other institution, it is likely that you have signed a promissory note.

  • 5.1.3 Requirements  
  • 5.1.4 Holders in Due Course  
    • Reading: Law of Commercial Transactions: “Chapter 24, Section 1: Holder in Due Course”

      Link: Law of Commercial Transactions: “Chapter 24, Section 1: Holder in Due Course” (PDF)

      Instructions: Read Chapter 24, Section 1 of the textbook.  Under the UCC, a holder in due course is a person with special rights in a negotiable instrument.  This person has certain rights that protect him or her against claims that either party to the original instrument might have made against each other.  Under the common law of contract, however, the holder in due course is simply an assignee.  As you proceed through this reading, pay particular attention to the UCC requirements that must be met in order to obtain the status of a holder in due course.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 5.2 Secured Transactions  
  • Unit 6: EMPLOYMENT LAW  

    The employer-employee relationship is a key one in the business world.  Until relatively recently, within the last one hundred years or so, this relationship was almost completely unregulated.  Even to this day, the central concept of most employment relationships in the United States is “at-will employment,” in which an employer can generally fire an employee for a good reason, a bad reason, or no reason at all.  (Similarly, an employee can leave a job for any reason.)  Historically, the employment-at-will doctrine has favored employers more than employees, as the employer usually has more bargaining power than the employee.  However, recently implemented regulations do offer more protection to employees.  For example, a comprehensive body of law protects employees from illegal discrimination based on, for example, race, ethnicity, or religion.  In addition, federal laws also protect the right of workers to organize into labor unions and engage in collective bargaining with employers.  This unit explains these concepts further and examines other laws and regulations that protect employees, such as health and retirement account laws.

    Unit 6 Time Advisory   show close
    Unit 6 Learning Outcomes   show close
  • 6.1 At-Will Employment  
  • 6.2 Antidiscrimination Laws  
    • Reading: Government Regulation and the Legal Environment of Business: “Chapter 18, Section 1: Federal Employment Discrimination Laws”

      Link: Government Regulation and the Legal Environment of Business: “Chapter 18, Section 1: Federal Employment Discrimination Laws” (PDF)

      Instructions: Read Chapter 18, Section 1 of the textbook.  One way in which the employment-at-will doctrine has been modified over the years has been through the setting of laws that protect certain classes of people against employment discrimination.  This reading will introduce you to laws in the United States that protect employees from discrimination on the basis of race, sex, ethnic background, religion, disability, or age.  In addition, you will learn about the important legal distinction between disparate treatment of protected classes (such as racial or ethnic minorities) and disparate impact of particular actions on protected classes.  As you read, pay particular attention to the basis for affirmative action laws and the limits of such regulations in the US legal system.  When you have finished this reading, complete the four exercises following the “Key Takeaways” box at the end of this section.

      Reading this textbook section and completing the exercises should take approximately 1 hour.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 6.3 Health, Safety, and Fairness Laws  
    • Reading: Government Regulation and the Legal Environment of Business: ”Chapter 18, Section 3: Other Employment-Related Laws”

      Link: Government Regulation and the Legal Environment of Business: ”Chapter 18, Section 3: Other Employment-Related Laws” (PDF)

      Instructions: Read Chapter 18, Section 3 of the textbook.  Over the last century, many laws have been passed that give employees greater protection in a variety of areas on the job.  Some of these laws, for example, address the handling of pensions and other retirement programs set up for the benefit of employees.  In addition, all states have enacted worker-compensation laws in order to protect the financial interests of employees when they are injured on the job.  More generally, both the federal and state governments have enacted a body of laws meant to protect worker health and safety.  This reading will provide you with a concise introduction to these types of laws and their application in the workplace.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 6.4 Collective Bargaining  
  • Unit 7: PROPERTY  

    The idea of property usually strikes people as a fairly simple concept.  However, the law recognizes that the interests in various types of property are often anything but simple, and can sometimes result in highly complex problems.  For example, if you sell your house to someone, what elements of the house cannot be removed, and, in contrast, what things can be taken with you when you leave?  Certainly you have an automatic right to take your clothes, your furniture, and your photographs and artwork.  But what about a favorite chandelier?  How about the built-in island counter in the kitchen?  Can you take the windowpanes?

    The law recognizes two categories of property.  There is real property, which is land and anything attached to it, such as a house and the items physically attached to the house.  In contrast is personal property, which includes everything outside of real property.  As you work through this unit, ask yourself what types of situations might render an item personal property, and what situations might render that same item real property.

    In this unit you also will explore the concept of intellectual property, which is a form of personal property.  Intellectual property represents intangible property rights in the form of words, symbols, designs, formulas, and other products of the human intellect.  For example, Coca-Cola has rights to the recipes for its products.  If the company’s recipes became public knowledge, Coca-Cola might lose its competitive advantage in the marketplace; as a consequence, Coca-Cola’s recipes are some of the most closely guarded trade secrets in US commerce.  As you will learn in this unit, trade secrets are just one type of intellectual property; and most forms of intellectual property are protected by federal laws and regulations.

    Unit 7 Time Advisory   show close
    Unit 7 Learning Outcomes   show close
  • 7.1 Real Property  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 8, Section 2: Real Property”

      Link: The Legal and Ethical Environment of Business: “Chapter 8, Section 2: Real Property” (PDF)

      Instructions: Read Chapter 8, Section 2 of the textbook.  Real property includes land and personal property that has become attachedto land.  The concept of attachment is critical in deciding whether a piece of property is considered real or personal – and thus which body of law applies to that property.  The next subunit will cover personal property in more detail; this reading will introduce you to the various interests and duties that may go into the ownership of real property.

      As you read this section, focus on the unique requirements that must be met during the transfer of ownership of real property, and the various ways in which such a transfer can be proven through the filing of transfer documents.  As you read, pay close attention to the concept of adverse possession, and consider the following questions: Does adverse possession seem fair to you?  Under what circumstances might you consider adverse possession to be fair, and under what circumstances might you consider it to be unfair?  Note that the possession of real property may be transferred without transferring ownership.  As you complete this reading, make sure you have a solid understanding of the various possessory interests that arise in real estate.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 7.2 Personal Property  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 8, Section 1: Personal Property”

      Link: The Legal and Ethical Environment of Business: “Chapter 8, Section 1: Personal Property” (PDF)

      Instructions: Read Chapter 8, Section 1 of the textbook.  Books, cars, shares of stock, and accounts receivable are all examples of personal property.  Ask yourself: How are these properties the same?  How are they different?  Note that some items that are considered personal property under one circumstance may be considered real property under another circumstance.  What might these different circumstances be?

      As you read this section, consider how transfers of personal property occur in our everyday lives.  For example, in the past year you have likely bought books, electronics, or even a car – all transactions in which you took ownership from a prior owner (either a business or an individual person).  As you read, make sure you understand the various ways in which the ownership of personal property can be transferred.  To better understand these concepts, explore the resources within the textbook section box titled "Hyperlink: Finders Keepers?"  Be sure you know what legal rights and obligations are at stake when the possession of (rather than the ownership of) personal property is transferred.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 7.3 Intellectual Property  
  • 7.3.1 Patents  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 9, Section 2: Patents”

      Link: The Legal and Ethical Environment of Business: “Chapter 9, Section 2: Patents” (PDF)

      Instructions: Read Chapter 9, Section 2 of the textbook.  Patent law is an increasingly complex area of the law that generates much conflict and controversy.  A patent provides property rights for the design of a useful new invention over a certain time period (after which the patent expires).  As you read this section, make sure you understand the three types of patents, and take note of the kinds of products and ideas that may not be patented.  This textbook section includes an interesting exploration of whether there is – or should be – the ability to patent a living thing.  Be sure to note the remedies that are available to patent holders when their patents are infringed.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 7.3.2 Trademarks  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 9, Section 4: Trademarks”

      Link: The Legal and Ethical Environment of Business: “Chapter 9, Section 4: Trademarks” (PDF)

      Instructions: Read Chapter 9, Section 4 of the textbook.  Trademark law allows a company to secure a claim to a specific identifying item that distinguishes the business, such as a name or a design.  Consider some of the trademarked items you might be familiar with – such as those used by international restaurant chains, software companies, and mobile-phone manufacturers.  Companies use trademarks to set themselves apart from similar companies and to allow their consumers to easily identify their products.  The US government has adopted a specific regimen of laws to protect such trademarks.  As you read, note the many identifying categories that may be trademarked, such as the shape of a bottle.  Take note, too, of what may not be trademarked under US law.  Lastly, be aware of the remedies that are available to trademark holders following the infringement or dilution of their trademark, as well as the defenses that can be made by an alleged infringer against a trademark-holder’s claims.

      Reading this textbook section should take approximately 45 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 7.3.3 Copyright  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 9, Section 5: Copyright”

      Link: The Legal and Ethical Environment of Business: “Chapter 9, Section 5: Copyright” (PDF)

      Instructions: Copyright is another area of intellectual property law that has grown more controversial over the past twenty years, particularly with the rise of the Internet.  The arrival of the web has allowed for an astronomical rise in the availability of original written content and other creative material to the general public.  For some users, this easy access can lead to confusion about the ownership of web material, including the assumption that such material may be used by any person for any reason.  In addition, other web users have intentionally sought to bypass the protections available to owners of such material.  Some see the copyright protections available to such creative work as excessively restrictive, and through various efforts these users attempt to promote the availability of creative work through open copyright licenses.  As you read this textbook section, familiarize yourself with the protections that US law provides to copyright holders.  Note the ways in which digital copyright licenses can further restrict the use of digital media, and be sure to pay attention to the remedies that are available to a copyright holder following a copyright infringement (as well as the defenses that an accused copyright infringer might make against such an allegation).

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 7.3.4 Trade Secrets  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 9, Section 3: Trade Secrets”

      Link: The Legal and Ethical Environment of Business: “Chapter 9, Section 3: Trade Secrets” (PDF)

      Instructions: Read Section 3 from Chapter 9 of the textbook.  Trade-secret laws generally protect businesses that wish to maintain the confidentiality of such properties as formulas, processes, or client lists due to the important economic value that these properties provide.  Unlike US trademark, patent, and copyright laws, trade-secret laws in the United States are covered only by individual state laws, not federal law.  Make sure you understand both the civil and the criminal penalties that a party might face when it is accused of stealing a trade secret, as well as the defenses that an accused party might mount against such a claim.

      Reading this textbook section should take approximately 15 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • Unit 8: TORTS AND CRIMINAL LAW  

    In addition to the civil disputes that fall under contract law, two other branches of law have a major impact on the operation of businesses: torts law and criminal law.

    Torts is a branch of law that imposes liability for civil wrongs that are not related to the violation of contracts.  Consider the following example: Your company’s delivery truck is hit by another vehicle, and you want to sue the other driver on behalf of your company for damaged goods.  But there is no previous contract that exists between you and the other driver.  In such a situation, your lawsuit will be carried out within the tort system.  Tort law allows individuals and businesses that have been wronged to receive compensation for that wrongdoing.  There are a number of different types of civil wrongs (torts), but the most commonly cited tort is negligence, which involves a breach of “duty of care.”  In order to sue on the grounds of negligence, you must be able to prove that a person or party who was responsible for something has violated that responsibility.

    Like torts, criminal law deals with what happens when an individual or group of individuals commits a wrong against another individual or group of individuals.  For example, Bernie Madoff was successfully prosecuted in 2009 for securities fraud when it was revealed that his investment-management business was not actually investing but rather taking money from later investors to pay off earlier investors.  Unlike contract disputes, criminal actions pertain to the direct violation of existing laws that a legislature has determined represent a pressing societal interest and thus require prosecution by the state or federal government.  As with contract law and torts law, criminal law cases usually include two parties – the prosecution and the defense – but in US criminal trials, the defense is always representing a regional, state, or federal government.  A criminal trial also includes a judge and, in many cases, a jury of peers.

    Unit 8 Time Advisory   show close
    Unit 8 Learning Outcomes   show close
  • 8.1 Torts  
  • 8.1.1 Intentional Torts  
  • 8.1.2 Negligence  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 7, Section 2: Negligence”

      Link: The Legal and Ethical Environment of Business: “Chapter 7, Section 2: Negligence” (PDF)

      Instructions: Read Chapter 7, Section 2 of the textbook.  Have you ever been around someone who acts carelessly and ends up breaking something?  If you become angry with and confront such a person, he or she might answer, "I didn't do it on purpose."  But the tort known as negligence tells us that even when a person does not intentionally commit a wrong, he or she still may be held accountable if he or she is found not to have exercised proper care.  The common standard used in judging such situations is to ask what a “reasonable” person would do in the same situation – that is, a person exercising adequate care, skill, and judgment in similar circumstances.  As you read, be sure to familiarize yourself with the different elements that compose negligence.  If a particular case meets all the elements of negligence, then it becomes necessary for a court to determine the level of damages due to the wronged party.  Also be sure to note the textbook's description of defenses that can be mounted against a charge of negligence.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 8.1.3 Strict Liability  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 7, Section 3: Strict Liability”

      Link: The Legal and Ethical Environment of Business: “Chapter 7, Section 3: Strict Liability” (PDF)

      Instructions: Read Section 3 from Chapter 7 of the textbook.  The law recognizes that some torts require holding persons liable for their acts even when they are deemed to have exercised reasonable care.  How could this be?  This reading outlines the various situations in which persons are held to strict liability.  Do you agree that such situations require a stricter level of accountability?  For businesses that engage in the manufacture or sale of goods, product liability has emerged as an important area of business law.  Pay particular attention to this reading’s discussion of product liability.

      Note that this reading also covers the material you need to know for subunits 8.1.3.1 and 8.1.3.2, found below. You can refer to those subunits for additional guidance on how to approach this reading.

      Reading this textbook section should take approximately 30 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 8.1.3.1 Traditional Strict Liability  

    Note: This topic is covered by the Chapter 7, Section 3 textbook reading assigned under Subunit 8.1.3 (above).  For this subunit, focus on reviewing how strict liability applies to ultra-hazardous and inherently dangerous activities.  Such activities are ones to which strict liability has traditionally applied as a result of social and judicial policies, such as keeping dangerous or wild animals or transporting explosives.

  • 8.1.3.2 Product Liability  

    Note: this topic is covered by the Chapter 7, Section 3 textbook reading assigned under Subunit 8.1.3 (above).  For this subunit, focus on the application of strict liability to product liability.  The concept of strict product liability represents a relatively recent and developing area of torts law.

  • 8.2 Criminal Law  
  • 8.2.1 An Overview of Criminal Law  
  • 8.2.2 White-Collar Crime  
    • Reading: The Legal and Ethical Environment of Business: “Chapter 10, Section 2: Crime”

      Link: The Legal and Ethical Environment of Business: “Chapter 10, Section 2: Crime” (PDF)

      Instructions: Read Chapter 10, Section 2 of the textbook.  This section covers the more notable types of what are known as “white-collar” crimes in business.  It is important to note that business-related crimes can extend beyond high-profile white-collar crimes.  For example, property crimes may be committed by any employee.  In addition, businesses may violate regulatory statutes that have criminal penalties, such as environmental laws.  Be sure to familiarize yourself with the most common criminal offenses, both white-collar and otherwise, that occur in business settings.

      Note that this reading also covers the material you need to know for Subunit 8.2.3, found below.  You can refer to that subunit for additional guidance on how to approach this reading.

      Reading this textbook section should take approximately 45 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • 8.2.3 Other Business-Place Crimes  

    Note: This topic is covered by the Chater 10, Section 2 textbook reading assigned under Subunit 8.2.2 (above).  For this subunit, concentrate on the sections of the reading that deal with cybercrime, environmental crimes, and blue-collar crimes.  It is important to note that business-related crime can involve a range of potentially illegal activities, from the illegal dumping of hazardous wastes to small-scale employee theft.

  • Unit 9: BUSINESS REGULATION  

    Government regulation is always a topic of debate within the business community.  In the immediate wake of Enron's massive accounting fraud, for example, US legislators passed the Sarbanes-Oxley Act (SOX) in 2002 to require publicly traded corporations to be more diligent in their reporting and auditing practices.  Many corporations have since elected to operate as privately held companies to avoid SOX regulations.  Other corporations maintain that they must devote so much of their resources to complying with SOX that they can barely sustain profitability.  Government regulations are passed all the time, and it is important that company owners and managers are aware of these changing regulations - those that already exist, those that are currently being created, and those that are being proposed for future removal.  All regulation developments have the potential to affect businesses and their employees.

    Unit 9 Time Advisory   show close
    Unit 9 Learning Outcomes   show close
  • 9.1 Antitrust and Trade  
  • 9.2 Securities and Corporate Regulation  
  • 9.2.1 The Securities Act of 1933  

    Note: This topic is covered by the Saylor YouTube video titled “Federal Securities Regulation in the United States” that was assigned under Subunit 9.2 (above).  For this subunit, review the video’s description of the key provisions of the Securities Act of 1933, particularly the registration requirements for securities.

  • 9.2.2 The Securities Exchange Act of 1933  

    Note: This topic is covered by the Saylor YouTube video titled “Federal Securities Regulation in the United States” that was assigned under Subunit 9.2 (above).  For this subunit, pay special attention to the video’s description of the key provisions of the Securities Exchange Act of 1933, particularly regarding the oversight of securities exchanges and broker-dealers of securities.

  • 9.2.3 Investment Advisers and Mutual Funds  

    Note: This topic is covered by the Saylor YouTube video titled “Federal Securities Regulation in the United States” that was assigned under Subunit 9.2 (above).  For this subunit, pay special attention to the video’s description of the key provisions of the Investment Advisers Act of 1940, particularly the registration rules and other requirements related to investment advisers.

  • 9.2.4 The Sarbanes-Oxley Act  
    • Web Media: YouTube: The Saylor Foundation’s “The Sarbanes-Oxley Act”

      Link: YouTube: The Saylor Foundation’s “The Sarbanes-Oxley Act” (YouTube)

      Instructions: Click on the link above and watch the entire video.  This video will present you with an overview of the Sarbanes-Oxley Act, passed by the US Congress and signed by President George W. Bush in 2002.  This law was introduced to address situations in which publicly traded companies were engaging in the misuse and misreporting of accounting and financial information.  The Sarbanes-Oxley Act attempts to correct prior corporate abuses by enforcing stronger penalties that hold corporation executives, lawyers, and accountants personally responsible for violations and more stringent reporting requirements.  As you watch this video, consider how the provisions of this act might affect companies – including, perhaps, your own.

      Watching this video and pausing to take notes should take approximately 30 minutes.

  • 9.3 Environmental Law  
    • Reading: Government Regulation and the Legal Environment of Business: “Chapter 14, Section 5: Environmental Law”

      Link: Government Regulation and the Legal Environment of Business: “Chapter 14, Section 5: Environmental Law” (PDF)

      Instructions: Read this textbook overview of environmental law in the United States.  While environmental considerations have been part of the law throughout history, these considerations have become more prominent beginning in the 1960s, as public concerns about air and water pollution have grown.  By the 1970s, the US government had created a range of statutes and regulations addressing diverse environmental issues such as hazardous waste, pesticides, noise control, and radiation.  As you read, familiarize yourself with the various laws addressing environmental issues that have been passed over the last fifty years.

      Reading this textbook section should take approximately 45 minutes.

      Terms of Use: This text was adapted by The Saylor Foundation under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 License without attribution, as requested by the work’s original creator or licensee.

  • Unit 10: CORPORATE GOVERNANCE AND REGULATORY COMPLIANCE  

    Now that you have explored various areas of business regulation in the US, you are probably wondering how businesses deal with the many legal requirements they are subject to.  For public corporations, managing compliance with government regulations is especially a challenge, given the accounting and securities regulations that have been put in place since 2002.  Recently, the position of “Chief Compliance Officer,” or CCO, has taken on an important role in corporate governance.  However, the CCO cannot be the only corporate leader concerned with issues of compliance and corporate liability for violating regulations.  Particularly after the adoption of the Sarbanes-Oxley Act, corporate leaders may be held personally liable if they fail to act on information suggesting noncompliance with accounting and other regulations.  Corporate executives and members of the board of directors must also remain vigilant.

    In this unit, you will look at the practicalities of applying government regulations in the corporate environment.  You will review the reforms of the past decade and consider their effects on corporate culture.  The readings in this unit will also highlight the role of a company’s board of directors in corporate governance, particularly in relation to a board’s duty of oversight.  Lastly, you will learn about how companies deal with “red flags” – warning signs that compliance problems may be arising – as well as questions that need to be considered when a corporation sets out to address compliance issues.

    Unit 10 Time Advisory   show close
    Unit 10 Learning Outcomes   show close
  • 10.1 Corporate Governance Reform  
  • 10.2 The Current Regulatory Climate  
  • 10.3 The Duty of Oversight  
  • 10.4 Considerations in Building Effective Corporate Governance and Compliance  
  • Final Exam