Healthsouth, Inc – Corporate Accounting Fraud Baruch College / Cost Accounting Research Paper

711 words - 3 pages

Healthsouth, Inc – corporate accounting fraud
HealthoSouth was one of the largest nationwide chain of orthopedic hospitals in 90’s. Built from a scratch by a talented manager Richard M. Scrushy for $1 million on 1986, its value passed $12billion mark in 1996 when it was first introduced to public stock market. All these growth, however, and large market cap was created by its management that executed one of the largest Wall Street accounting frauds of $2.7 billion. The fraud happened in its most due to lack of economic regulations in that period and specific investor’s focus on revenues but not profitability of companies. Company growth was a key from a point of attracting new capital. This environment put a huge pressure on lots of CEOs of the period, they were forced to show continuous growth and meeting market expectations for each reporting period. HealthSouth depended heavily of government money as most of its patients used Medicaid. Company grew incredible 31% on average a year thanks to this strategy. In 1997 when government decreased spending on Medicaid financial situation of HealthSouth was under extreme pressure as these funds accounted for more than 40% of company’s revenues. This was the time company management started to play with books to keep investor’s expectations and steady growth.
Company CEO Scrushy and corporate “financial family” that consisted of 5 CFOs started to alter earning numbers. In order to increase revenues corporate board followed few basic steps: compared real financial results to analyst expectations; if earning were short of needed numbers – managers were forced to adjust them in any way possible; false ghost documents were created in order to level up false entries in statements. Since top management of HealthSouth was filled with many experienced former E&Y auditors (the company that happened to continuously audit HealthSouth) they knew how to keep this kind of fraud off the public view. One of the most common tricks of this fraud was keeping amounts of money moved less than $5k at a time – management knew that E&Y assurance company will not look at any entries below this amount. So, HealthSouth employees were forced to cre...


Research topic on cost accounting - Michigan State University - Essay

4730 words - 19 pages training session. During your first week at Waterford, you’ll be applying many of the concepts that you worked so hard to understand over the course of four grueling years of college accounting classes: sales revenues, cost of goods sold, operating and administrative costs, taxes, interest expenses, and net profit. In week two, you’ll get some actual experience working with current and long-term assets, current and long-term liabilities, and owner’s


958 words - 4 pages The article discusses about features of the German cost accounting system and ways that company running it can exploit its capabilities. Cost accounting in Germany is different compared to that in the US, and software systems are one of the key differences The German software company, SAP, has designed a complex software system that is on its way to becoming a world standard in business software. This system is based on German cost accounting

ACC 550 Cost Accounting Milestone 3 - University - Essay

2006 words - 9 pages ACC 550 Cost Accounting Megan Rall Southern New Hampshire University Milestone #2 II. Inventory Management A. After reviewing the characteristics of absorption and variable costing, I believe absorption costing is the ideal cost allocation method to use for New Hampshire Company. Absorption costing is explained as a process for gathering the costs connected with a manufacture process and allocating them to specific products. A product may

Accounting Essay- Career research - Accounting - essay

552 words - 3 pages to learn and develop skills in the field of entrepreneurship. Of the various accountant careers i’ve found during my research, I believe that management accounting most strongly aligns with what I enjoy doing and provides tasks that I can naturally thrive on. When making important strategic decisions, business leaders need to know the status of an organization’s financial health and how it could be affected. It’s the responsibility of management

Comparing Periodic and Perpetual Inventory - Accounting 101 - Research Paper

2076 words - 9 pages Accounting 110 Professor Copeland October 21st, 2018 Nuts To You vs. International Spice & Food Perpetual inventory is an inventory system when inventory is adjusted continuously throughout an accounting period. Every time a product is sold, the inventory decreases and every time products are purchases for inventory purposes, the count increases. In perpetuals inventory system, inventory is also adjusted when products are moved from one location

accounting as an integrated part of today's world - english - research paper

1489 words - 6 pages stakeholders need to evaluate the financial performance of a business. This paper deals with the scope of accounting, the average wages of an accountant and the professional accounting bodies in different parts of the world. The accounting jobs in the U.S and internationally keep increasing year over a year. Accountants and auditors have a positive trend in the U.S. “In 2017, there were 1.24 million accountants and auditors and 1.53 million

capital budgeting accounting and finance - berkeley - paper

2820 words - 12 pages the consultant $10,000 for his work. UPC faces a corporate tax rate of 35%. UPC is an equity financed firm. The cost of equity capital is 10%. Cash flows are end of year unless noted. Question: Should UPC buy the new machine? Conceptually, we already know how to do this: I Calculate the NPV of the cash flows associated with the project. But, getting to the cash flows will require some work. Donatella Taurasi (Fung Institute) Accounting and Finance

Chapter 25 homework accounting II - Hunter College - assignment

714 words - 3 pages -term predictions of future cash flows and is less subject to changes in external factors that might adversely affect the investment project. 6. If net income is earned evenly throughout each year and straight-line depreciation is used, the average investment is the original cost plus the salvage value, divided by 2. For this machine, the average investment equals $110,000, computed as ($200,000 + $20,000)/ 2. 7. When the present value of expected

2-1 Short Paper: The Accounting Cycle - ACC 201 SNHU - Short Paper

815 words - 4 pages Running head: ACC 201 MODULE TWO SHORT PAPER 1 ACC 201 Module Two Short Paper 5 201 Module Two Short Paper: The Accounting Cycle Janae’ C. Malry Southern New Hampshire University This paper will discuss the importance of the accounting cycle and the products that it supplies along with the ten steps that makes up the cycle. If this cycle is not followed correctly, it can cause many errors when information is input into a journal. Following this

Corporate Social Responsibility - York University/SOSC 1340 - Research Paper

2766 words - 12 pages , Milton Friedman takes on the first position and describes corporate social responsibility as an immoral, dangerous doctrine by reinfusing the solidity of corporate artificial personhood. On the other hand, Harry Glasbeek, in Wealth by Stealth, attacks the very notion of corporate legal personality by describing it as a fictional creation that gives corporations an immense power to achieve their profit-driven goals at the cost of society’s

MAC Reserch for corporate asset finance - MAC 2017 - research paper

5526 words - 23 pages Free : Application of the Internet of Things in Financial Services 8 2.1 Cutting costs in trade finance Global trade finance is a complex process. A dizzying number of manual checks must be carried out to verify the legitimacy of a client, its trading partners and the goods that change hands. Most checks require the physical presence of a person, and the administrative work conducted by bank middle offices is overwhelmingly paper-based. The high cost of

Corporate Governance and Fraudulant reporting Project - Liberty University ACCT 650 - Research paper

2919 words - 12 pages they participated, encouraged, approved, and had knowledge of the on going improper actions leading to the fraud findings (Rezaee, 2005, p. 280). The various allegations of fraud made against Corning Glass included at one time or another most of its board of directors, its president, and the management teams of its accounting department and the research and development division (R&D) (J. Cram, personal communication, 1970-1988). Other items that

college & career research paper - connections - research

1189 words - 5 pages Free - 1160 usually get into the college. The location of Adirondack is in Queensbury, NY and is about 50 miles from home. The cost of going to school their off - campus was about $5,375 . The enrollment for the college is simply just a application form. And the average financial aid based on (Big Future - College Search) was around $10,875 for students that qualified. This college also qualified for the Excelsior Scholarship which was a major factor

Wal-Mart: The High Cost of a Low Price - Copper Mountain College, College Composition - Research Paper

1385 words - 6 pages Lucelena Barba Professor Walker English 3A.01 College Comp. November 30, 2015 Wal-Mart: The High Cost of a Low Price In 1962, Samuel Walton founded the company, Wal-Mart, which is now Americas largest discount retailer. Many Americans believe that Wal-Mart helps create jobs and generate economic growth in communities but that is not the case. In the film, Wal-Mart: The High Cost of a Low Price, Robert Greenwald showcases the truths behind this

This is an Apple Inc research paper - Senior - Research Paper

1124 words - 5 pages run by Tim Cook. Keywords: Apple, Manufacture, Computers Apple Computer, Inc. Apple Computers, Inc was founded by two college dropouts, Steve Jobs and Steve Wozniak. They started their company with thirteen hundred dollars and began creating in 1977, in a garage. Wozniak was a self-taught electronic engineer. He first invented a keyboard which connected to a television. This was known as Apple I. A retailer that Jobs and Wozniak met at Homebrew