Question

Bonding involves all of the following except

A) The company obtains insurance protection against misappropriation of assets by a dishonest employee.

B) The insurance company screens employees before they are added to the policy.

C) The company informs employees that the insurance company will vigorously prosecute all offenders.

D) Employees do not commit inappropriate acts because of the threat of prosecution and their loyalty to the employer.

Answer 1

C) The company informs employees that the insurance company will vigorously prosecute all offenders.

Step-by-step explanation:

• As a bond is a measure of the indebtedness to the issuer and the holder thus is a type of debt security depending on the type of terms of the bond.

• They can be corporate and municipal as they are issued by the public authorities, companies and the supranational institution or primary markets. The most common type of issuing a bond is through the underwritings.

• They can be fixed, floating and high yield, convertible and exchange bonds. An insurance company can have a bond as a form of protection of the company form the action of the employees.