Standard: HealthSouth will market our services fairly and in accordance with federal and state laws and regulations. Retrieved March 22, 2005, from the World Wide… 1419 Words 6 Pages misconduct is the chief cause behind corporate accounting scandals. Heading South: The Burglar of Birmingham Jenks Healthcare Business Report April 2003 ' Based on our interviews with a key whistle-blower, there was an incestuous-like relationship between top HealthSouth officials and a small group of investment bankers and analysts. Ensure that all transactions are appropriately and adequately documented and that source and original documentation is organized, maintained and safeguarded. New charges were filed yesterday against several former HealthSouth officials by the Securities and Exchange Commission. Employees should immediately report missing property, as well as any unusual circumstances surrounding the disappearance of Company assets, to a supervisor, manager, or the Internal Audit Department.
We are continually improving the quality of our text archives. These false entries allowed the corporation to inflate its earnings and revenue. A graduate of the University of Rhode Island, he frequented strip bars, wears loud ties and has a taste above all for deals, say people who have spent time with him. Plans to split the company were first proposed in 1992 after a large merger fell through after due diligence by the proposed acquisition. While others started expressing concern about HealthSouth in 2002, Lorello's analyst maintained positive assessments until 2 days after the charges which followed the raid in March 2003.
HealthSouth employees are expected to conform to applicable state professional practice acts and professional codes of ethics at all times. Report potential violations of law or Company policy. Eventually, though, Scrushy promised more than the company could deliver, according to Beam. Slide 9 - if wanted to make sure all interest expense got put on the books, go through all the outstanding loans and make sure the interest got put on the books. They need to be measurable and likely Other examples, Contingent liability, debt guarantee, Throughput Agreement - A company needs more capacity, the company promises to pay another company to use their facility as a way to get more capacity. Scrushy's partners in Capstone were John W. Your call will not be traced or recorded, and your anonymity will be protected up to the limits of the law if you wish to remain anonymous.
Michael Vines was a bookkeeper at HealthSouth who oversaw the purchase of equipment. Exceptions, where expressly permitted by state law, must be approved by the Government Affairs Department. This will allow the Company to seek your help in answering questions that may have arisen during an initial investigation while fully protecting your anonymity. Combined with this increased pressure of growth was an environment of strange legalism. They are not designed to describe all applicable laws or all HealthSouth policies or to give full details of any individual law or policy.
In addition to cash, kickbacks and inducements can include, but are not limited to: Above fair market value lease payments to a referral source or free or below fair market value lease payments from a referral source ; Loans to referral sources with below market interest rates or other terms that do not meet commercial lending standards; Professional services contracts e. The commentary potentially enhances the learning experience for students using this case. If successful, the plan might have helped HealthSouth avoid disclosure of the alleged accounting fraud. This will allow the Company attorneys to contact the agent to establish a basis for cooperating with the investigation. Tax avoidance - This is legal, you aren't paying more taxes than you are legally required too. Harris, Smith Barney's top health care analyst.
The reasons that this fell through were never disclosed but there is now a possibility that they scented the fraud and HealthSouth became scared. You are expected to know the basic laws and regulations that apply to your job. In addition to physical and financial assets, Company assets also include certain intangible or intellectual property. Billing, coding, and collection practices must conform to applicable government rules and commercial contractual obligations. The Committee receives periodic reports on the Companys progress in meeting the plan, including reports of all regulatory audits. Since then, some people have started to question the company's early restructuring.
Reports will be treated in a confidential manner. Violations should be reported promptly to a supervisor or another manager, the Human Resources Department, or the Chief Administrative Officer. The stock analyst, Howard G. Chief Executive Richard Scrushy has offered to have his client testify before Congress about the scandal-plagued company he founded, as long as Scrushy receives immunity. All employees are expected to cooperate with the Companys internal auditors and its independent auditors. It also includes verbal or physical conduct of a sexual nature that creates an intimidating, hostile, or offensive working environment.
Patients will not be denied access to medical services at any HealthSouth facility based on race, sex, religion, national origin, or other classification prohibited by law. While the corporation was dabbling in a fraudulent, aggressive account…. Right now they aren't supposed to be on the balance sheet, in a few years they will have to be. Their executives followed three basic steps while committing the fraud: 1 Company officials compared their internal financial statements to see if they would meet analyst expectations. First, they neglected the 500% net income increase from 1999-2001. Again this was opposed with the board of directors stating the exact same arguments as they used the year before.
They earned huge fees by designing tax shelters that the government deemed legal. The market refused to go along with these strategies and HealthSouth was forced to abandon them. Auditors have uncovered hundreds of millions of dollars in previously unreported accounting fraud at HealthSouth, the embattled chain of hospitals and clinics, the company said yesterday. Confidential information acquired in the course of my work is not used for personal advantage. It listed a series of such violations that included booking as revenue the charges to clinic patients even when insurers denied payment. This Code of Ethical Conduct for Financial Managers Code applies to all HealthSouth Financial Managers.
If they don't take the full amount of units that are promised, then they will pay a penalty for it. At that time, a number of HealthSouth executives besides Scrushy were on the MedPartners now Caremark board of directors. Your former employees have told them you were involved. Make it clear that you are open to questions or concerns about compliance-related issues from your direct reports or other employees who may bring concerns to you. Every employee has a duty to protect and not misuse HealthSouth property, assets, facilities, equipment, and supplies. He was acquitted by the jury in 2005.