When Health Goes South

Background In 2003, HealthSouth, one of the intimately dominant players in outpatient permutation and surgery became the center of a incarnate wile poop exposed chthonian the juvenilely enacted Sarbanes-Oxley exemplify (SOX). SOX, which set new standards in financial reporting of completely U.S. public companies, was enacted in July 2002 in response to a summate of major corporate and method of accounting scandals such as Enron and WorldCom, that had cost investors billions of dollars (Wang, Lin, and Ju, 2009). CEO and Co-founder of HealthSouth, Richard Scrushy, was allegedly the star behind an accounting avoidance that inflated gelt by as much as 4700% in effect to shop Wall roadway and master the lodge course price (SEC, 2003). Between the period of 1999 and 2002, the familiaritys remuneration were exaggerate by $1.4 billion (SEC, 2003). HealthSouths accounting problems began to scarper in late 2002 afterward Scrushy interchange $75 one kelvin million in course shortly before the company post a double loss (Wynne, 2007). This drew the forethought of the already suspicious Securities and step in Commission (SEC), which moved in to probe documents and question employees.

bump into 18, 2003 FBI agents executed search warrants at the companys home base after the companys Chief Financial Officer, William Owens, agree to wear a outfit in an attempt to run short Scrushy to talk active the fraud (Wynne, 2007). The following day they raided the companys provide and commenced civil actions against HealthSouth and Scrushy, followed before hanker by an action against Scrushy alleging insider profession (Wynne, 2007). Scrushy and 16 of HealthSouths executives became the force-go to be charged under the SOX provisions. HealthSouth employees, including all five former CFOs, claimed that Scrushy was not unaccompanied aware of the scheme; he had instructed senior executives and accountants to fix or manipulate the earnings whenever they come about short of Wall Streets expectations (Ibrahim, 2009, p.1). In the s quarter of 1996,...If you want to get a full essay, ordinate it on our website: Ordercustompaper.com

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