{% extends "global/Page.html" %}
{% load otree %}

{% block title %}<h1 align="center">Internal Audit</h1>{% endblock %}

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<p></p>
<p>After all division managers have reported their earnings, headquarters selects some managers’ reports for an internal audit.  Because all division managers who report high earnings receive a bonus, headquarters wants to avoid paying any unearned bonuses.  To limit the auditing cost, headquarters randomly audits all high earnings reports with a 50% probability.  </p>

<p>An audit allows headquarters to determine a division’s actual earnings with certainty.  If you report high earnings and your report is <em>not</em> selected for an audit, then you will receive the bonus mentioned earlier, regardless of whether your division’s actual earnings are high or low.  If you report high earnings when your division’s actual earnings are high and your report is selected for an audit, then you will receive the bonus.  If you report high earnings when your division’s actual earnings are low and your report is selected for an audit, then you will not receive the bonus and you will pay a penalty.</p>

<p>If you report low earnings, then your report is never selected for an audit.  </p>

<p></p>

<p>Please click the ‘CONTINUE’ button to proceed.</p>

<p align="right"><button class="btn btn-primary btn-large">CONTINUE</button></p>

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