| HEALTHSOUTH | The Wagon To Disaster | | “HealthSouth: the Wagon to Disaster” Is a book written by Aaron Beam covering the rise‚ fall and repair to a monster health care company. Aaron was one of the founding members of HealthSouth. A main focus of “HealthSouth: The Wagon to Disaster” is the life‚ instructions and actions of Richard Scrushy. Richard was the founding leader of HealthSouth‚ and by the account of Aaron‚ Richard was also the origination of the downfall of
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INTRODUCTION HEALTHSOUTH Corporation (HEALTHSOUTH) began its rise in 1984 when Richard Scrushy‚ Aaron Beam‚ and other close associates formed the HEALTHSOUTH Empire with venture capital from New Enterprise Associates of Baltimore. In the beginning‚ Richard Scrushy was the chief executive officer (CFO)‚ Aaron Beam was named the chief financial officer (CFO) and William Owen‚ an accountant from Ernst and Young‚ assumed the position of comptroller. HEALTHSOUTH went public in 1986 and began rapidly
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Scrushy wanted to build a better future for him and his wife. After graduating from the University of Alabama‚ he obtained an entry level job at Life-mark Corp. Scurshy started from the bottom and climbed his way up to success. In 1984‚ Scrushy found HealthSouth‚ to providing a healthcare services for senior citizen and athlete. Soon after it opened it‚ started to attract costumers including famous athletes. Scrushy to become one of the most successful business executive. But not every business obtains
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HealthSouth Corporation: Fraud‚ Greed and Corporate Governance Manmohan D. Chaubey‚ Ph.D. The Pennsylvania State University One College Place Du Bois‚ PA 15801 (USA) Tel: 814-375-4846 Fax: 814-375-4784 Email: mdc13@psu.edu Case for ICMC2006 International Conference on Management Cases 4-5 December 2006 IMT Ghaziabad‚ India HealthSouth Corporation: Fraud‚ Greed and Corporate Governance During the 1990s‚ Richard M. Scrushy‚ the former CEO of HealthSouth Corporation‚ engineered many acquisitions
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Memorandum Date: 2/18/13 Re: HealthSouth Accounting Scandal HealthSouth Corp.‚ one of the nation’s largest healthcare services providers in the United States was involved in one of the largest accounting scandals in United States history. HealthSouth Corp and its officials overstated earnings in order to meet Wall Street earnings expectations. This memorandum will describe who was involved‚ how the operation was carried out‚ as well as a timeline documenting the resulting damages of the scandal
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HealthSouth Impact on Stakeholders HealthSouth’s fraud impacted many of their stakeholders. Some of the stakeholders discussed below are the Directors and Management Team‚ external auditors Ernst & Young‚ the employees‚ the patients‚ and Chief Financial Officer Weston Smith. The Board of Directors and Management team engaged in several conflict of interest actions. They were the first company to be charged under the Sarbanes Oxley Act of 2002; which holds financial executives more accountable by
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An obstacle to Aaron Beam’s moral behavior is when he moved some of the businesses start up costs as expenses and list them as capital investments‚ which inflates the company profit margins. Beam initially did this because of the pressure from Scrushy to make the company appear more profitable. Then the cycle continues. The way I understand the meaning of the “loyal agent’s argument” is that you do what you are instructed to do by your employer regardless. However‚ I do not believe Aaron
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Running head: HEALTHSOUTH: THE RISE AND FALL HealthSouth: The Rise And Fall Abstract Richard Scrushy (Scrushy) had a vision and was driven by his leadership and entrepreneurial abilities. Scrushy was the mastermind and major creator of HealthSouth Corporation (HealthSouth). Scrushy served as chairman and Chief Executive Officer (CEO) of the corporation for more than 20 years. A Biographical Sketch: Richard Scrushy and HealthSouth. Retrieved March 22‚ 2005‚ from the World Wide
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Case Study HealthSouth: The Trials that Temper an Organization1 Table of Contents Abstract ......................................................................................................................................................... 3 Case Overview............................................................................................................................................... 5 Background ..............................................................................
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1. What are several red flags that E&Y either was or should have been aware of in the audit of HealthSouth? Overall‚ there were three “red flags” E&Y was not aware of during the audit. First‚ they neglected the 500% net income increase from 1999-2001. This should have raised awareness because revenues only increased by 5% during that same period. Second‚ the internal auditors were denied access to some of the corporate ledgers. E&Y should have seen this as being one of the largest red flags. Third
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