Which expense can be excluded when calculating the cost of doing business for a compliance program?

When calculating the cost of doing business for a compliance program, expenses that directly result from penalties imposed due to non-compliance can be excluded. This is because penalties are not costs incurred to proactively ensure compliance; rather, they are financial consequences arising from violations of laws or regulations. Including them in the cost structure might misrepresent the actual investment a business makes to maintain compliance.

On the other hand, the costs associated with training staff on compliance issues, investing in compliance software, and conducting audits are essential investments made by an organization to create and maintain a robust compliance program. These expenses aim to prevent infractions and foster a culture of compliance, making them integral to the overall cost of doing business in a compliant manner.