The Accounting Scandal Of Healthsouth

The Accounting Scandal of Healthsouth
The Accounting Scandal of HealthSouth
HealthSouth Corporation is based in Birmingham, Alabama, it is the largest provider of
rehabilitative health care services. It operates in 26 states in the United States of America and in
Puerto Rico. HealthSouth provides rehabilitation hospitals, long term heightened care hospitals,
outpatient rehabilitation satellite clinics and home health agencies.
HealthSouth was found by Richard Scrushy in the year 1984 and was called Amcare, Inc. It opened
its first facility in Arkansas and later on that year another one in Birmingham. In 1985 the company
changed its name into HealthSouth Rehabilitation Corporation, in 1990 the company expanded to 50
facilities around the US. ... Show more content on Helpwriting.net ...
HealthSouth financial officer William Owens contributed with the securities and exchanges
commission and became an informer by recording his conversation with Scrushy to provide the
government evidence for their case. In one of the conversation Scrushy said to William Owens that
he could get killed if he fixed the financial statements immediately, but this problem could easily be
dealt with over time.
On March 19 of the year 2003, Securities and Exchange Commission brought the trading of
HealthSouth to an end on the New York stock exchange, charging the company for inflating its
earnings by more than 10 percent and overstated its profits by more than $2.5 billion between 1999
and 2002. HealthSouth's trading reached to $30.81 in the year 1998, but ever since the trading of the
company has been put to an end it reached to $3.91 per share. One week later, Owens pleaded guilty
to changing and editing the company's financial statements.
On March 31, the board of directors fired Scrushy and Owens and the auditors Ernest & young.
The company removed Scrushy's name from the conference center and hired a restricting firm to
help the company to avoid bankruptcy.
As HealthSouth started reviving from the scandal, Scrushy's problems were only starting. In October
of the year 2003 Scrushy faced more than 85 charges, including charges that he falsified accounts at
the HealthSouth's company which lead to $2.7 billion fraud of investors, by reporting conjured
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Richard Scrushy and HealthSouth Essay
Introduction HealthSouth is one of the nation's largest healthcare providers specializing in
rehabilitation. HealthSouth was founded by Richard M. Scrushy in 1984 and went public in 1986.
Scrushy served as its Chairman of the Board from 1994 to 2002. The company was incorporated in
January 1984 as Amcare Inc. before its name was changed to HealthSouth Rehabilitation
Corporation in May 1985. In January of 2003, Mr. Scrushy reassumed the position of CEO.
HealthSouth grew rapidly during the 1980's and 1990's. This growth was largely due to acquisitions.
HealthSouth owned more than 330 hospitals worldwide. It was also during this time that Scrushy
became known as one of the highest paid CEOs in the United States. ... Show more content on
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The charges included conspiracy, money laundering, obstruction of justice and perjury (Johnson &
Johnson, 2005, p. 37). Were there any early warning signs that may have predicted this type of
behavior in Mr. Scrushy? "Perhaps what we need is a scale for measuring the moral development or
character of the officers to whom the financial status and reports of the company are entrusted"
(Jennings, 2005, p. 44–45). One measurement that can be used is a look into their personal lives. An
evaluation of the private conduct of the executive can often prove to be insightful and a predictor of
future behaviors. "How we treat those who are the closest to us and, at least in theory, the most
important is telling" (Jennings, 2005, p.45). Mr. Scrushy was married to wife number three and is
the father of eight children by three different women. Impact on Stakeholders
Richard Scrushy's management style was one that fostered intimidation and fear amongst his
employees. The weekly Monday morning meetings were often called Monday morning beatings
when the actual budget numbers did not meet the forecasted expectations. "Every Monday morning
he grilled his division chiefs on the profits in their areas of responsibility and publicly berated any
subordinate who failed to meet his expectations" (Solieri, Felo & Hodowanitz, 2008, p. 342).
Whenever actual financial results did not meet the forecast, Mr. Scrushy's instructions were to go
and

Richard Scrushy Case
From ethical and legal perspectives, what do you feel business has learned from the Scrushy
situation?
Richard Scrushy defrauded, stakeholders, stockholders, and the community out of millions of
dollars. His deceptive, unethical, and commanding behavior was the stone that caused the biggest
misappropriation avalanche of all time. We must consider this question, how is corporate cheating
happening and who is heading the deception? Behind every crime, there is a ringleader or a group of
individuals "calling the shots." In this case, Scrushy was the one who told his "family meeting
members" to "fix" financial records, so HealthSouth to meet or exceed the business financial goals.
A person from the beginning may have the objective to cheat; others get sucked into the whirlpool
of white–collar crime.
Corporate fraud is rampant, and it is becoming a part of our culture. We expect to hear about some
cheating or embezzlement within the financial world. That should not be the case. However, one
would think that after Tyco, Enron, WorldCom, and more recently VW, that business had learned
that "cooking the books" or in the case of VW (lie to emission regulators) does not get you a gold
medal in the end.
Arel, Beaudoin, Cianci, (2011) argue that "executive ethical leadership and an "high–quality"
internal audit function, can positively guide accounting managers ' making decisions involving
uncertainties."
In the case of HealthSouth, the lack of morality and integrity diverted

Healthsouth Fraud Essay
Culture
During the 90's, investors and lenders shifted their interest from a company's bottom–line to its
yearly revenue growth. Furthermore, companies with growing revenues were worthy of receiving
investments to finance growth. The shifted focus motivated companies like HealthSouth to
transition into practicing more aggressive revenue recognition policies. Aggressive eventually
turned illegal when HealthSouth began overstating its revenues. From the 2 million journal entries
under $5,000 recorded to source documents fabricated, HealthSouth went to great lengths to commit
and conceal its fraud. In addition, employees were closely monitored to ensure that they were not
arousing suspicion to HealthSouth's fraud. The leading force of HealthSouth's culture was the ...
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Before resigning, Vines emailed Ernst & Young to inform them to observe three accounts. Ernst &
Young closed the audit file after the CFO said that Vines was an unhappy employee. He was not
investigated, but he tried to end the fraud scheme. Vines was lucky to leave when he did, but others
were not so lucky. As one of the nation's leading medical service providers, over 51,000 employees
across the country became uneasy during the fraud investigation. Tom Goetziner, a stock analyst,
believed that HealthSouth would be applying for Chapter 11 as early as April 2003. However, he
also added that some of their other services would remain available to the public. For example,
HealthSouth owned fifty–five locations providing various medical services throughout the state of
Oklahoma. Therapist layoffs were likely and less–successful enterprises would be closed as part of
the company's restructuring plan. By November of 2003, HealthSouth had laid off more than a
couple thousand of its employees due to corporate downsizing (Hamilton n.d.) (Lawrence 2003)
(MeCoy

Ernst & Young was the auditing firm of HealthSouth from...
Ernst & Young was the auditing firm of HealthSouth from 1984 to 2002. Due to financial hardship
Healthshore grew desperate and developed a scheme to deceive not only shareholders but Ernst and
Young. Inevitably whistleblowers came forth and a lawsuit ensued. The shareholder's lawsuit against
Ernst and Young never went to trial. However, the lawsuit against Healthshore ended in settlement.
Though a travesty to the shareholders and employees not involved with the fraud, this fraudulent
activity was necessary for it forced the SEC to hinder these types of events to occur in the future.
There may still be cases similar to HealthShore going on today had it not been for the Sarbanes
Oxley act enforcing stricter requirements for auditing firms. ... Show more content on
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Scienter of statements would indicate either the auditor purposefully deceived information or made
reckless decision when issuing an opinion which in both cases would qualify as an audit failure. If
Ernst and Young made any untrue statements concerning material facts or omitted necessary facts on
opinion this would classify as a violation of Rule 10b–5.
3a.) In 1998, an angry shareholder who described themselves as "fleeced shareholder" had e–mailed
auditors and financial regulators questioning how HealthSouth was cooking their books. It is the
date and detail in the e–mail that proves the most frightening. The e–mail displays that the fraud
should have been caught long before it was uncovered. Unlike most investors, it was evident that
this person had a background in accounting and raised legitimate concerns. Ernst & Young admitted
to receiving this email in November of 1998. However, Ernst & Young felt the questions raised by
the anonymous writer did not affect the presentation of the financial statements. Moreover, a former
bookkeeper of HealthSouth, Michael Vines, also e–mailed Ernst & Young about specific area of
fraud. His background qualified for his email to be considered worthy evidence. Nevertheless, Ernst
& Young claimed that the accounting practices being question were

The Healthsouth Corporation Inc.
INTRODUCTION The HealthSouth Corporation was started in 1984 by Richard Scrushy with
hopes of becoming one of the largest healthcare companies in the country. It was doing quite well by
1996 with a market value of nearly $12 billion and was one of the United States largest healthcare
firms. This all fell apart in 2003 when it was discovered that Scrushy and his employees had
committed fraud in the estimated range of almost $2.7 billion (Daigle, Louwers and Morris 887).
Scrushy, over the years, had brought on many new faces to the company. Many of these employees
were friends of Scrushy from previous business ventures and business meetings. These employees
and the others involved in the fraud were given the name 'family'; highly due to the fact that they all
knew what was happening and not one wanted to go to the authorities to confess. It was after the
fraud had gone on for nearly six years that the former CFO Weston Smith tipped off federal
investigators.
Following the actions by Smith, the four other CFO's who ran the company during the fraud came
forward which included: Aaron Beam Jr., Michael Martin, Malcom McVay, and then current CFO
William Owens. Along with the CFO's their staff members who were also in on the fraud also came
forward bringing the total number of involved to fifteen. Also the Birmingham Alabama office of
Ernst & Young came under heavy scrutiny for auditing HealthSouth during the fraud and failing to
take action on any evidence they found.

Healthsouth : The Wagon At Disaster
HealthSouth: The Wagon to Disaster is an eye–opening and compelling insight into what went on
behind the colossal travesty HealthSouth Corporation became. The account is written by Aaron The
beam, a founding member of HealthSouth who witnessed the rise and fall of Wall Street's darling.
The novel details the beginnings of both Richard Scrushy and Aaron Beam, the conception of
HealthSouth, and the slow, slippery cliff of fraud that would lead to the downfall of a billion–dollar
enterprise and tragedy for most involved.
The story of HealthSouth begins with two of the most well know founders. Richard Scrushy was a
bold, charismatic man of middle–class beginnings. He would rise from a mason to one of the highest
earning CEO's in the country due mainly to his ability to drive, charm, and manipulate those around
him. Driven by the desire to attain wealth and status Scrushy was hired in at LifeMark where he rose
through the ranks as a result of his unbridled competitive nature and workaholic tendencies.
Though it was at the end of Richard's career at LifeMark that the story of HealthSouth begins. When
it was announced that the company's Houston office would be closing Richard brought Beam and a
few others into his plan. Scrushy wanted to form a company based on a new type of rehabilitative
medicine company that due to the changing medical field was highly profitable. This bold and
ambitious idea the degree of brilliance Richard Scrushy had. Certainly most of his future ideas

Healthsouth: The Rise and Fall Essay
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 Web: http://www.richardscrushy.com/biography.aspx. The U.S. Securities and
Exchange Commission charged HealthSouth Corporation and CEO Richard Scrushy with fraud,
alleging the earnings of HealthSouth have been extremely overstated since ... Show more content on
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One year later, Scrushy accepted a position with Lifemark and began a flourishing rise in the
corporate world. Scrushy had dreams of his own and during his successful ascend, began planning a
new company. He visualized a rehabilitation corporation with outpatient centers, clinics and
hospitals. These centers, which were only a dream, would swiftly move patients through physical
rehabilitation and permit them to return to work, jobs, and home at a much quicker pace than
individuals were accustomed. Scrushy's vision became a reality and would emerge in the world of
health care as HealthSouth. A Biographical Sketch: Richard Scrushy and HealthSouth. Retrieved
March 22, 2005, from the World Wide Web: http://www.richardscrushy.com/biography.aspx.
HealthSouth began operation in 1984 with five employees who shared a one room office. Scrushy
supplied the majority of the money, paid payroll and business expenses out of his own pocket until
spring of 1984. Twelve years after its founding, HealthSouth was named to the Fortune 500.
HealthSouth had quickly become a major leader in rehabilitation, surgery, and diagnostics with
operations in all fifty states. Centers were strategically placed in numerous countries outside the
United States. The centers operated by HealthSouth and under the leadership of Scrushy were
regarded highly for the outstanding service, commitment, and state–of–the–art technology. A
Biographical Sketch: Richard Scrushy

A Report On Healthsouth Used Bad Debt Reserves Essay
whatsoever. Moreover, the amount of the accounts written off in any given year did not correlate
with the allowance established for them. To the extent that these disclosures were reliable, these data
indicate that HealthSouth used bad–debt reserves to manipulate earnings. This lack of correlation
could be an indirect indicator of the fourth warning sign of abusive earnings management: reserves
that are not correlated with balance sheet items.
Consider two related items related to uncollectible accounts, to further understand possible earnings
management. First, there were disproportionately large allowance for doubtful accounts balances at
the end of 1994 and 1995: nearly 40% of gross receivables. These existing balances could have been
drawn down without the need to record an accurate provision for doubtful accounts. Consequently,
the year–end charge to bad expense, required to replenish the depleted contra–asset account, could
have been less than normally expected if the unadjusted allowance balance jibed with economic
reality. By understating expenses in this manner, HealthSouth could have manufactured earnings
beginning in the mid–1990s. These data provide some evidence of the classic "cookie–jar reserve"
ploy (Reed et al, 2003).
The related issue is the amount of bad–debt expense matched against revenues in 1999. As noted,
that unusually large charge to earnings was made at the time when it became publicly known that
HealthSouth could no longer hit its earnings target.

Healthsouth Case Study Essay
HealthSouth Rehabilitation Hospital of Round Rock, formerly Reliant has been in operation since
2008. HealthSouth acquired the hospital in October of 2015. HealthSouth is the largest provider of
inpatient rehabilitative services in the nation, with 121 hospitals nationwide. Since acquisition the
objectives of the hospital have drastically changed. Prior to acquisition the hospital was owned by a
holding company. The objective of the holding company was to maximize profitability and control
operating expenses. The hospital ran with minimal expense and the highest percentage of profit
possible. Upon acquisition the leadership team of the hospital was tasked with moving the
organization to comply with the objectives of HealthSouth; Quality, Integrity, ... Show more content
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Leadership Practices: The candidate provides a reasonable description, with substantial detail, of 3
leadership practices of the current primary leader of the existing organization. The current primary
leader of the organization is the CEO. He has many years of leadership experience in various
healthcare settings. With a master's degree in healthcare administration and a primary degree in
nursing he has a broad array of knowledge pertinent to running the organization. As far as leadership
practices as strengths, experience is his greatest strength. The CEO communicates to the senior
management team, the goals and direction of the organization. He shares regional and corporate
directives and deadlines for project completions. Each week a senior management meeting is held to
discuss existing action plans or projects, their progress and any new or added areas of focus. He acts
as a liaison between the organization and the community. He keeps abreast of developing business
in the community that could either be a competitor or a potential referral source for generating new
business. He monitors the organizations goals and progress and directs change at the facility level
based on reported metrics performance measures. The role of the CEO is to direct the senior
management teams' efforts to run the organization and meet corporate performance

Healthsouth: Fallout And Recovery
Fallout and Recovery
After the FBI search on HealthSouth's home office in March 2003, exchanging of the Company's
stock on the NYSE was promptly excluded. HealthSouth was likewise expelled from the S&P 500
and its stock was removed from list the next week, after which its shares were exchanged on over
the–counter "pink sheets." The stock price had closed at $19.55 on March 18; when trading resumed
on March 25, the opening price was only $1.85, and it closed the day at just $0.60 (Berry, 2009).
J.P. Morgan Chase restricted HealthSouth's $1.25 billion credit extension–which the Company
required retrieve to repay its bondholders almost three hundred million by the end of April 2003.
These situations were leading the organization in verge of bankruptcy.

A Case Study In Corporate Fraud
Back in the 1990's, HealthSouth became one of the largest healthcare service providers nationwide,
with the earnings over the billions through several years. Due to the large investments made, it
brought on the temptation of "cooking" the books to move money around to places it should not be.
Management then began to put a plan together, to move small amounts at a time, so as not to be
detected. "It was reported that HealthSouth was overstated investments by almost 5 billion, which
made the average journal entry around $2,500." (HealthSouth: A Case Study in Corporate Fraud –
Arxis Financial, Inc.) Now I will explain further how the corruption occurred and the consequences
of that end result. There were several people involved in the corruption plan of the largest healthcare
services. One being the bookkeeper, Mr. Vines, who looked over the balanced sheets to see if any ...
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(HealthSouth: A Case Study in Corporate Fraud – Arxis Financial, Inc.) Mr. Livesay stated his
participation was a one–time thing and could get easily corrupted, but later on became a willing
participant. As an end result of his actions, he was put on a six month house arrest and ordered to
pay $760,000 in criminal forfeitures and fines. (HealthSouth: A Case Study in Corporate Fraud –
Arxis Financial, Inc.) Mr. Crumple, VP & Division Controller, would attend meetings in order to
find out where to fake postings in the journals. He would then instruct the accountants to put the
fake entries into the company's books. (HealthSouth: A Case Study in Corporate Fraud – Arxis
Financial, Inc.) Eventually he moved money to a company called Source Medical to look like a real
investment. For his involvement he received 8 years in prison and a fine of $1.4 million dollars.
(HealthSouth: A Case Study in Corporate Fraud – Arxis Financial,

The Healthsouth Scandal: Richard M. Scrushy
The HealthSouth Scandal
The HealthSouth Corporation is a prominent and prestigious company. It has been named, "one of
the nations largest healthcare provider specializing in rehabilitation " (Welcome). HealthSouth
should be applauded for their hard work and dedication to reach such a high–valued title.
Unfortunately, this company will be receiving no applauds. Not all of their hard work and dedication
was approving and it was all because they had a snake in their system. HealthSouth's CEO Richard
M. Scrushy almost single handedly destroyed the company. The HealthSouth scandal is known to be
one of the greatest rises, almost ruin and return the nation has ever seen.
So how and where did this powerhouse of a company get its start? The ... Show more content on
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"HealthSouth: A Case Study in Corporate Fraud." Arxis Financial, Inc. Simi Valley. 4. Print.
"HealthSouth." 20 Feb. 2015. Web. 27 Mar. 2015. <en.wikipedia.org/wiki/healthsouth>.
HealthSouth Scandal Summary Presentation. 2013. Film.
"Former HealthSouth CEO, Richard Scrushy, Gets Prison Sentenced Reduced." Forbes. Forbes
Magazine. Web. 29 Mar. 2015. <http://www.forbes.com/sites/walterpavlo/2012/01/26/former–
healthsouth–ceo–richard–scrushy–gets–prison–sentenced–reduced/>.
New York Times. "HealthSouth Corporation." News. Web. 27 Mar. 2015.
<http://topics.nytimes.com/top/news/business/companies/healthsouth–corporation/index.html>.
Ranaivo, Yann. "HealthSouth's Turnaround One of the Biggest Stories of Last 30 Years –
Birmingham Business Journal." Widgets RSS. 30 Aug. 2013. Web. 27 Mar. 2015.
<http://www.bizjournals.com/birmingham/news/2013/08/29/birmingham–milestones–
healthsouth.html?page=all>.
"Scrushy Case Is Critical Test of New Law." Tribunedigital–baltimoresun. 26 May 2005. Web. 29
Mar. 2015. <http://articles.baltimoresun.com/2005–05–26/business/0505260111_1_oxley–sarbanes–
healthsouth>.
"Welcome to HealthSouth." HealthSouth: A Leading Provider of Rehabilitation Services for
Recovery after Stroke. Web. 27 Mar. 2015.

Culture : Weston Smith And The Ceo Of The Healthsouth...
Culture Weston Smith (2013), former CFO of HealthSouth, states "the tone of the company may be
memorialized through policies and procedures, both written and spoken, but nothing sets the tone
more than the everyday actions of the leadership." At the top of the HealthSouth organization sat
Richard Scrushy. As founder and CEO of the company who instilled fear in employees that did not
carry out his orders. This set the tone from the top. Do as you're told or suffer the consequences.
When financial results did not meet market expectations, managers were told to fix it. And they did
by creating false journal entries and false documentation to back up those entries. There were no
checks and balances in place and the accounting system was not linked to the enterprise resource
planning software. There was no oversight of managers by a board of directors or an audit
committee. The audit committee was not well trained, did not have enough staff, and was not
independent of management. Scrushy had complete control of the company and he was obsessed
with increasing his earnings trends. He reinforced the idea of top management being family and
therefore more loyal to each other than to the unknown public (Lupica, 2014). Impact on Company
Management Due to the scandal, 15 HealthSouth executives plead guilty to criminal charges. Due to
sentencing by various judges, the standards employed in sentencing were not consistent. Some of
the executives served jail time, some were

Healthsouth Rehabilitation : Bridging The Gap
HealthSouth Rehabilitation – Bridging the gap
HealthSouth Rehabilitation Hospital in Plano, Texas is an 83–bed rehabilitation hospital designed to
meet the rehabilitation needs of the community in both the inpatient and outpatient setting. In a
phone interview with Heather McBride, OTR, Director of Quality and Risk Management at
HealthSouth, I was able to discuss some current issues facing this type of facility. One thing I
learned without a doubt is there is a definite need for this facility as it bridges the gap from acute to
sub–acute care.
HealthSouth Rehabilitation Hospital is a large corporate company on the stock exchange. According
to the company's website, HealthSouth Rehabilitation Hospital is accredited by The Joint
Commission and also earned a Disease–Specific Care Certification from The Joint Commission in
addition to Joint Commission accreditation for their stroke and hip fracture rehabilitation programs
(HealthSouth Plano Rehabilitation Hospital website, 2015). Ms. McBride spoke of their most recent
certification in Oncology Rehabilitation. She also stated, "We use accreditation to measure how we
are doing and to find ways in which we can improve" (H. McBride, personal communication,
September 26, 2016).
HealthSouth has a number of rehabilitative programs in place. Ms. McBride speaks of those
programs such as an amputee program, arthritis, brain injury, cardiac care, diabetes, hip fracture,
joint replacement, trauma, pain management, Parkinson's

Factors of Ethical Collapse
Many successful businesses operated under a set of normative standards, expected behaviors and
guidelines that are generally accepted by society (Jennings, 2009). That is, businesses operated
under ethical principles that "consist of standards and norms for behaviors that are beyond laws and
legal rights" (Jennings, 2009). These ethical principles are reflected in an organization application of
trust, integrity, fairness and responsibility. Research groups have identified overarching ethical
principles as the application of honesty, fairness, objectivity, and responsibility. A company's use of
ethical principles demonstrates solid corporate governance and management (Verschoor, 2011).
However, when these principles are deliberately ... Show more content on Helpwriting.net ...
One of the first signs of an ethical collapse is when the organization's culture is one of intimidation
and the employees feel pressure to perform which was the HealthSouth's corporate culture.
Employees felt pressured to meet unrealistic expectations and were intimidated into fabricating
numbers if the goals were not met. For instance, when the company was not meeting the numbers
and analysts' expectations, executives were required to figure it out, even if the goal was just short a
dollar (Jennings, 2009). In fact, Mr. Scrushy believed that if you shine a light on someone that is not
meeting the expected goal, then that individual will feel obligated to improve the numbers
(Jennings, 2009). The company's culture was filtrated with fear of dismissal, threats of critics with
reprisals, and incentives for loyal subordinates (Jennings, 2009). Essentially, the Healthsouth
"employees felt pressure to make the numbers do what they felt their superiors wanted them to do"
(Jennings, 2004). This type of culture influences employees to behave unethically and with fear of
consequences. As a result, some employees will knowingly behave unethically as a means

Healthsouth Research Paper
There were many flaws in corporate governance of the Healthsouth and some of them were very
obvious that makes one question that how could they have been missed. Healthsouth clearly lacked
proper internal controls as employees failed to abide by the laws and principle. It goes to show that
the internal controls procedures and policies are not effective enough to provide reasonable
assurance of the reliable financial statements. It implies that the internal auditors failed to execute
their duties and responsibilities. The fact that accounting personal and management held meetings to
create false entries, shows the poor ethical environment of the firm (Brooks, 305). Poor balance of
power was also one of the major flows. Scrushy had excessive

Health South (B) Case Study
Case Study HealthSouth (B) Executive Summary HealthSouth is in need of creating a professional
image and adopting ethical principles while addressing the following problems: unhappy coworkers
and managers, improper business practices including creating falsified statements and unlicensed
people performing physical therapy, and unethical behavior involving corporate leaders and the
CEO. There are signs of lack of leadership and purpose within this company and unethical
procedures that need to be addressed in a timely manner. We have provided within this case a
framework to turn this downward cycle around and make HealthSouth a profitable and ethical
organization. First, we will separate accounting duties which will help people remain ... Show more
content on Helpwriting.net ...
A deep combing of the internal operations would have to be performed in order to make
recommendations on best practices for internal financial control. Recommendations The firm should
separate the duties of accounting clerks. Duties would be divided for income, expense, PPE
(property plant and equipment), liabilities, and cash account. Each person would only prepare one
side of each entry and all entries signed off by department manager, having the third person sign off
helps keep you honest. Posting expenses to asset account overstates assets, decreases expense and
increases profits. Equipment should be purchased through a closed bid system. The firm would offer
preapproved companies to bid for specified equipment. Employee's personal references, work
history, education and licenses would be checked and verified separately by Human Resources. All
licenses would be display in appropriate work areas. All employees will receive continual job
training and required to stay up to date on technology. Billing will be verified to employee time card
and scheduling of treatment rooms and equipment. Board members will consist of members with a
variety background. An election committee will be formed to interview and make recommendation
for possible members. No member will be related to another member and only two members from
the same field. Having broad

How Corporate Scandals Crush the Company, Investors, and...
Tracing back the history of accounting scandals, major corporate scandals not only hurt the
economy but also crush investors' confidence on investing in companies. For example, the Enron
scandal, the WorldCom scandal, and so on. The majority of corporate scandals are created by greedy
corporate senior officers. One way to create a scandal is "cooking the books". Cooking the book is
an accounting term which means making false financial statements in order to meet the number that
investors or banks expected. In this case, Richard Scrushy is one of the greedy Chief Executive
Officers (CEO). According to Washington Post, Richard Scrushy, was a self–made son of the new
South, a former teenage parent who hauled himself up from a menial job to become an emperor of
the new economy (Steve Barnette, Washington Post). Richard Scrushy, the CEO and the founder of
HealthSouth Corporation, was one of the most successful and respected business men in the state of
Alabama. This is a story of a fallen American dream. HealthSouth Corporation is the United States'
largest inpatient rehabilitative hospital. HealthSouth provides the services of rehabilitative care to
patients recovering from all kinds of conditions. It started in 1984, the company was originally
named Amcare Inc. By the end of 1990, HealthSouth expanded to 50 facilities all over the United
States. HealthSouth reach $400 million in annual revenue in 1992. By the end of 1999, HealthSouth
became a four billion dollar company with

The Scandal Of Healthsouth Corporation Scandal
Introduction Organizational misconduct is the chief cause behind corporate accounting scandals.
The trusted executives of the corporation participation in actions during a scandal are corrupt,
unethical, and illegal. In the United States, the Securities and Exchange Commission (SEC) is
typically the government agency that investigates such scandals. One of the most notorious
corporate accounting scandals in the United States is the HealthSouth Corporation scandal of 2003.
HealthSouth Corporation is one of the United States largest healthcare providers with locations
nationwide. A deeper inspection of the HealthSouth scandal is needed to understand how it
transpired by assessing how it was executed, the accounting issues and root of the issue, how it was
exposed, the results to the company and its main contributor, and ramifications as an outcome of the
scandal.
Scandal Overview In 1984, Richard Scrushy founded HealthSouth in Birmingham, Alabama.
Scrushy was the company's Chairman and Chief Executive Officer (CEO) when the company went
public in 1986. HealthSouth grew quickly over the next several years. Shortly after HealthSouth
went public, it is alleged that Scrushy instructed senior staff to materially inflate the company's
earnings to match expectations. In 2002, the first sign of troubles occurred when Scrushy sold $75
million of HealthSouth stock days before HealthSouth announced a large loss. After this the SEC
began to investigate if any insider trading laws had

Dorothea Orem 's Theory Of Self Care
Dorothea Orem's Theory, Metaparadigm and how it relates to Nursing Practice at HealthSouth
Sunrise Rehabilitation Hospital
According to Petiprin (2015), Dorothea Orem's theory is used to encourage a person to become
more independent. Petiprin (2015) further states that it is true of rehabilitation settings, (Such as,)for
example HealthSouth Sunrise Rehabilitation Hospital in which patients are transitioning out of
being cared for by physicians and nurses and to exclusive self–care at home. According to George
(2011), Dorothea Orem has developed three connecting theories: the theory of self–care, the theory
of self–care deficit and the theory of the nurse system. George defines the term metaparadigm as the
core content of a discipline (2011). George further states that the metaparadigm of the discipline of
nursing comprises of four major concepts: person, health, environment and nursing (2011). At
HealthSouth Sunrise Rehabilitation Hospital, the mission of our operations is the delivery of quality
healthcare in the most appropriate, safe, patient–centered environment (HealthSouth, 2015). The
purpose of this paper is to discuss Dorothea Orem theory, metaparadigm and how it relates to
nursing practice at HealthSouth Sunrise Rehabilitation Hospital.
Dorothea Orem's Theory
Three connecting theories developed by Dorothea Orem are the theory of self– care, the theory of
self–care deficit and the theory of the nurse system (George, 2011). Self–care theory is offering an

Healthsouth
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 growing through the acquisition and construction of new
rehabilitation hospitals, outpatient clinics, and diagnostic service centers. HEALTHSOUTH was
commonly referred to as the "Pacman" of rehabilitation and outpatient surgery due to ... Show more
content on Helpwriting.net ...
Overview of Key Evidence of the Prosecution
Richard Scrushy, former Chief Executive Officer of HEALTHSOUTH Corporation, was ultimately
charged with one count of conspiracy, ten counts of money laundering, thirteen counts of wire fraud,
seven counts of mail fraud, two counts of securities fraud and lying to United States investigators,
two counts of falsifying statements, and one count of falsifying certifications. The charge of
securities fraud led to a probe of possible insider trading in his sales of HEALTHSOUTH stock.
There is evidence which supports that HEALTHSOUTH'S administration began fraudulently
"cooking the books" in the mid 1990s in an effort to build a sophisticated corporate Empire by:
· defrauding the system of payment (Medicare),
· increasing returns by playing on the vulnerability of citizens through over–servicing and
overcharging,
· cutting the costs of care by understaffing, under–resourcing and under–servicing, or
· by a combination of any two or more of these.
Human and financial resources were diverted from healthcare to marketing, to provide funding
sources for HEALTHSOUTH to be competitive in the healthcare arena. Reallocating financial
resources also provided HEALTHSOUTH with adequate funding for political donations, which is
said to have influenced political decisions,

Forensics & Project Management : The New Best Friends...
Forensics & Project management: The New Best Friends Forever (BFF) in the Fight against
Financial Crimes in this 21st Century. By Ambe Diom Afumbom
Executive Summary
The SNIFFING book–cooking schemes of major corporations and firms such as HealthSouth Corp,
Enron global etc, plaguing our financial world in this era, is an indication that we require "all hands
on deck" in the fight against financial crimes. The variability and self–motivated nature of frauds,
characterized by material destructive consequences, has raised a myriad of alarms in the corporate
world. In reality, the dynamic nature of fraud perpetration present complex, intricate and titanic
tasks to the forensic investigator who by mandate and dictate from the fast growing technology and
sophisticated defrauding strategies of phonies, is required to expand Knowledge and proven skills to
be relevant and become verifiable human tool. Forensic investigators are obliged to push forward
innovative and exhaustive practices in order to squash this canker–worm. This study hopes to
provide support to the literature on "Financial Crimes Fight" that has tried to establish that;
– Top–tiers in corporations are more susceptible to fraud on a grand scale than any other
stakeholder,
– Offer proactive solutions against perpetrators.
The general conclusion from these studies is that "integrating forensics

Healthsouth Management Has Overstated Earnings Essay
in 2003, investigators found that HealthSouth management had overstated earnings by at least $2.7
billion over a 17–year period. Furthermore, before the scheme was exposed, members of senior
management had been quietly selling their shares as quickly as they dared and falsely reporting that
HealthSouth had billions of dollars in existing assets. In August 2002, the then CEO and Chairman
Richard Scrushy sold $75 million worth of his company shares just weeks ahead of HealthSouth
announcing that cuts in Medicare reimbursements would reduce its pre–tax profits by $175 million.
The company also said it wouldn't issue earnings guidance for the remainder of 2002. HealthSouth's
share value immediately tumbled from $11.97 to $6.71 (HealthSouth 2002, Appendix 1). With top–
tiers selling their shares and the resultant rapid and precipitous drop in the company's share value,
attracted the SEC's attention to investigate these occurrences. The company's insiders told SEC that
the Medicare payment reduction actually was $20 million at most, and that management was using
the additional $155 million in supposed reimbursement cuts to make up for reported earnings that
never existed (HealthSouth 2002, Appendix 1) Granting that the detection of the fraud scandal was
based on the evidence from HealthSouth Corporation 2002 financial reports,

Unhealthy Accounting at HealthSouth Essay
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, the audit team failed to properly investigate employee complaints.
2. What procedures can auditors perform to detect fraudulent entries made during the consolidation
process?
Most of the time, fraudulent activity is found by ... Show more content on Helpwriting.net ...
4. What is the appropriate response by auditors to information from "disgruntled" employees?
Depending on the severity of the fraud, the appropriate response can be different from firm to firm.
A good way to detect fraud would be to listen to information provided by a disgruntled employee.
This holds true unless the employee was disgruntled before the fraud occurred. The information will
probably be false and misleading because the employee has held animosity for a while. Regardless,
you should take the information seriously when it is first presented to you.
5. HealthSouth has sued E&Y, and E&Y is the target of a federal securities class action suit. What
are E&Y's likely defenses against HealthSouth? Against the class action suit?
One of the main defenses E&Y took during the early stages of the HealthSouth suit was the fact that
the SEC had no well–defined rules with regards to audit–related practices. Another defense was the
mere fact that E&Y never faced a criminal indictment for the HealthSouth fraud. This was mainly
due to the statute of limitations placed on securities fraud. It sets it at the earlier of (a) 2 years after
the discovery of the facts constituting the violation or (2) 5 years after such violation. Thus, the DOJ
was unable to file criminal charges against the firm because the partner on the audit (G. Marcus
Neas) was "unaware" of the fraud in 1993.
6. HealthSouth

The Scandal Of Healthsouth Corporation Scandal
Organizational misconduct is the chief cause behind corporate accounting scandals. The trusted
executives of the corporation participation in actions during a scandal are corrupt and illegal. In the
United States, the Securities and Exchange Commission (SEC) is typically the government agency
that investigates such scandals. One of the most notorious corporate accounting scandals in the
United States is the HealthSouth Corporation scandal of 2003. HealthSouth Corporation is one of
the United States largest health care providers with locations nationwide. A deeper inspection of the
HealthSouth scandal is needed to understand how it transpired by assessing how it was executed, the
accounting issues and root of the issue, how it was exposed, the results to the company and its
officers, and warranted ramifications as an outcome of the scandal.
Scandal Overview In 1984, Richard Scrushy founded HealthSouth in Birmingham, Alabama.
Scrushy was the company's Chairman and Chief Executive Officer (CEO) when the company went
public in 1986. HealthSouth grew quickly over the next several years. Shortly after HealthSouth
went public, it is alleged that Scrushy instructed senior staff to materially inflate the company's
earning to match expectations. In 2002, the first sign of troubles occurred when Scrushy sold $75
million of HealthSouth stock days before HealthSouth announced a large loss. After this the SEC
began to investigate if any insider trading laws had been violated. In 2003,

Analysis Of Fraudulent Activities And Examination Of...
Analysis of Fraudulent Activities and Examination of the Failure of the External Auditor,
Internal Audit, and the Audit Committee HealthSouth Corporation is one of the U.S.?s largest
healthcare companies and is the biggest owner and operator of inpatient rehabilitative hospitals. The
present CEO, Richard Scrushy, founded this Fortune 500 company in 1984. It expanded
tremendously in the 1990s and received most of its revenue through Medicare. By 1993, it became
the largest rehabilitation services company. However by the late 1990s, the company suffered from
changes in Medicare policy, dramatically decreasing their revenues. By 2002, it was starting to face
financial issues, stock prices dropped precipitously, and Scrushy temporarily resigned as CEO
(Soltani 263). Then in 2003, HealthSouth was charged with Medicare fraud and falsification of its
earnings, internal control defilements, fraud, and ?cooking the books? (Soltani 263). Specifically,
the SEC stated in 2003, that since 1999, HealthSouth misstated its earnings upward by at a
minimum $1.4 billion. The corporation was the first one charged under the Sarbanes–Oxley Act of
2002. Overall, this paper will discuss the mechanisms of the fraud and the accounting methods used
to commit the fraud. Also, this paper will examine the audit failure of the external auditor, Ernst &
Young (EY), HealthSouth Corporation?s audit committee, and HealthSouth Corporation?s internal
auditor function. Richard Scrushy was indicted in

The Healthsouth Fraud Acct 480: Forensic Accounting
The HealthSouth Fraud ACCT 480: Forensic Accounting Emily Bauer 2/7/2016 At the time when
the HealthSouth fraud was discovered in 2003, HealthSouth was the largest owner and operator of
inpatient rehabilitative hospitals as well as a provider of surgical and diagnostic services. Employing
more than 60,000 people at their 2,000 locations, this billion dollar company had locations in all 50
states as well as operations in the U.K., Canada, Australia, Puerto Rico and Saudi Arabia. In 2003,
they were the third largest healthcare company based on revenue. The majority of this revenue,
however, was fraudulently created. Then CFO, Weston Smith, talks in detail about the fraudulent
activity going on at HealthSouth during his 16 year career ... Show more content on Helpwriting.net
...
He describes that the fraudulent actions were presumed to be temporary and would be made up for
future quarters making it easier to justify. Employing the "Everyone is doing it." concept allowed
Weston to convince himself that HealthSouth's actions were permissible. Due to the fact that other
businesses were doing it, it became justifiable for HealthSouth to do the same in order to stay on the
same level. Weston described the 80's as a "wild time" in the business industry where cooking the
books was a common occurrence. So this type of behavior not only existed with HealthSouth, but
the business industry as a whole, making the fraudulent actions even more

The Healthsouth Scandal : Richard Scrushy
To help understand what happened in the HealthSouth Scandal we'll need to understand a few
things. First we need to know some of the key people involved. The person who allegedly
spearheaded the scandal was Richard Scrushy. Scrushy was the CEO of the company starting in
1994 until he was removed from office in 2003, and was also one of the cofounders of HealthSouth.
He is thought to have been the one to convince the rest involved to commit the fraud.
Next we'll need to know is who the "Big 5" were. (Stuart) The "Big 5" were the five CFO's involved
in the scandal. (Stuart) Starting in chronological order of time in which they held the CFO position
we'll start with Aaron Beam Jr. Aaron served in the company for almost 13 years and was also one
of the cofounders with Scrushy. Next we have Michael D. Martin, followed by William T. Owens,
Weston Smith, and finally Malcolm "Tadd" McVay. All the CFOs had a hand in the HealthSouth
fraud which misled investors by overinflating the stock price of HealthSouth stock making it appear
more profitable than it actually was.
Next we need to include the five CFO's direct staff. We'll start with Richard Botts who was the Vice
President for Taxes within HealthSouth between 1998 and 2003 (Stuart). He was responsible for
filing falsified document to tax officials. Jason Brown, HealthSouth's Vice President of Finance
between 2000 and 2003, falsified documents to help fix HealthSouth's books and make the company
look more profitable than it

Similarities Between Healthsouth And Enron
The accounting fraud made HealthSouth became a member of that disreputable group (Henselmann
& Hormann 2010). In 2001, HealthSouth agreed to pay $7.9 million to settle Medicare–fraud
allegation on overcharged assets. Trading in the securities of HealthSouth's shares was suspended
for two business days by SEC due to the materially misleading information in the marketplace (U.S.
Securities and Exchange Commission 2003).
Fifteen former executives of HealthSouth, including all five of its recent Chief Financial Officers
pleaded guilty to various charges of falsifying accounts. However, the CEO, Mr. Scrushy's assets
were freeze temporary by the court and also forfeiting his passport and keys to his private jet. Lastly,
he was acquitted of all 36 ... Show more content on Helpwriting.net ...
The company was penalised with a $1.5 million refund to 7,000 affected customers as well as
$50,000 contribution to Financial Counselling Australia. An involvement of an external compliance
consultant was also compulsory to ensure consumer credit laws are complied with by reporting back
to ASIC (Ong & Janda, 2016).
Issues involved in this case include governance issues, as Nimble were inconsistent with the
recognition of activities from customers (Ong & Janda, 2016). They also lacked in governance in the
sense that protocol was not properly complied with by not making appropriate inquiries to
customers (Ong & Janda, 2016). They also failed to comply with consumer credit laws as evident of
the need for an external compliance consultant (Ong & Janda, 2016).
Both companies failed to meet proper corporate obligations. As leaders of their company, the higher
ups of Nimble and Enron should have been the positive model figures and encourage proper and
scrupulous behaviour in order to carry out the proper procedures and protocols. This behaviour bred
harmful activities and enabled carelessness within the

The Beginning and End of HealthSouth Corporation
HealthSouth Corporation was incorporated in January 1984 in Birmingham, Alabma by the founder
Richard M. Scrushy. HealthSouth Corporation is the leading provider of medical rehabilitation
health care and outpatient surgery services in the United States. Richard M. Scrushy was the former
CEO& Founder of HealthSouth Corporation, and there were 5 CFO which were Aaron Beam,
Weston, Smith, Bill Owens, Michael Martin and Tadd Mcvay.
Richard M. Scrushy is one the founder of HealthSouth in 1984. And he also is the CEO of
HealthSouth. At the beginning with his friend in Amcare Company, he use a million dollars
investment by Citicorp Venture Capital to founded HealthSouth. Two years later, Richard made
HealthSouth become a listed company. In 1987 HealthSouth has expanded to two new areas, which
is worker's compensation and sports medicine. Thus it makes HealthSouth earned a hundred million
dollars. By 1988, HealthSouth has operated a network of 21 outpatient facilities, 11 inpatient
facilities, and seven rehabilitation equipment centers in 15 states, it has became the leader of
rehabilitation industry in the U.S(James Press, 2000).
HealthSouth got rapid growth through acquisitions in the early 1990s. In early 1990s HealthSouth
has been financing over a hundred and eighty one million dollars over 50 states in United States. By
the mid–1990s, HealthSouth has operated 14 inpatient and 31 freestanding outpatient rehabilitation
centers in 21 states. And it continued to add new

Corporate Culture Of Healthsouth Corporation
Background
HealthSouth Corporation was one of the largest publicly traded owners of rehabilitative hospitals
within the Untied States and paved the way for its industry. However, prior to 2003 the company
had a very dark secret: fraud. In 2003 HealthSouth was accused of making $2.7 billion in false
journal entries in the company's system (Helios, 2013). These false entries allowed the corporation
to inflate its earnings and revenue. While the corporation was dabbling in a fraudulent, aggressive
account system, auditors were unable to detect the extent of the fraud occurring. If not for Michael
Vines and Weston Smith, HealthSouth Corporation might have continued its false entries and
continued deceiving shareholders and even Wall Street itself. HealthSouth serves as a historical
example of how corporate culture can use fraud and deception schemes to not only rationalize what
it is doing, which is an element of the fraud triangle, but also encourage fraudulent financial
statements.
Corporate Culture The corporate culture of HealthSouth Corporation was one of pressure and
blackmailing. The corporate culture of a corporation determines how management, employees, and
customers interact within the work environment and corporate market. According to the case,
HealthSouth Corporation pressured company employees to meet the futile expectations of corporate
Wall Street. As well as pressure from corporate executives of the company, the employees learned
by example from the unethical,

Healthsouth Case Study
HealthSouth Corporation, a Birmingham, Alabama based Delaware company, is one of the largest
health care providers and is the largest owner and operator of inpatient rehabilitative hospitals in the
Unites States. It is an industry leader of home based patient care and operating its business in 33
states across the nation and Puerto Rico. It specializes in providing long–term rehabilitative
treatment and care to patients who suffer from serious debilitative conditions, such as strokes and
genetic illnesses. The corporation also treats patients with injuries resulting from trauma such as
high–speed crash survivors with spinal fractures and damage to the brain.
HealthSouth was incorporated by Richard M. Scrushy on February 22, 1984 and named ... Show
more content on Helpwriting.net ...
While regarding the acuity level of how patients are treated, HealthSouth is quite different from
normal hospitals. They, as rehabilitation hospitals, generally provide services to patients who have
been under a stable physical condition and are in the process of recovery. Besides HealthSouth,
other major competitive players in the industry are Select Medical Holding, Kindred Healthcare,
Inc., Genesis Healthcare, Tenet Healthcare, NHC, etc. Even though a great number of competing
firms appeared in this post–acute–care provider industry recently, no one provides exact the same
services like HealthSouth does, making the industry in a monopolistic competitive pattern. When
operating business, HealthSouth faces threats from different aspects, threats from sources like new
entrants, rivalry, and even buyers. Providing services for years, the company has been a mature
company in the industry and has definite cost advantages and competitive advantages in its services
quality. The competition exists at national level, as well as at local level. As for patients, the
customers in this industry, they forced the industry participants engaged in providing more
professional and quality practices. With the pressure of price negotiation by customers,

Ethical Issues In Healthsouth
HealthSouth is mentioned in this week's chapter regarding companies that have suffered due to
ethical and fraudulent behaviors. In the early 2000's, HealthSouth was under investigation by the
SEC for overstating earnings by 2.5 billion dollars. Simply stated, the CEO, Richard Scrushy, and
his leadership team were cooking the books. Fortunately for HeatlhSouth, Jay Grinney succeeded
Scrushy and the company has rebounded better than before, seeing growth across the country and
showing increased stock prices (Macfadyen. 2015).
To recover from this gross negligence and to be able to move forward in a highly regulated health
care industry required the top executives to develop a robust ethics and compliance program to
prevent further unethical ... Show more content on Helpwriting.net ...
The plan was developed using a comprehensive analysis of the industry risks and HealthSouth's
historical data. The areas listed on the plan were deemed high priority based on vulnerabilities,
regulatory scrutiny, industry trends, and risk assessment results and are monitored and audited
regularly. This document is designed to be dynamic and change organically as issues are identified.
HealthSouth expects the Compliance Work Plan to be implemented and embraced by all
stakeholders in order to ensure success. As they have for years now, the findings are published on
the HealthSouth intranet site for employees to view.
Fortunately, our top executives and board of directors have set a good example and upheld the
business standards and values of the company. Remaining true to our mission to provide high
quality health care in the communities we serve, and maintaining our values of quality, integrity,
cost–effectiveness, and respect has led HealthSouth favorably past the scandal of the early 2000's.
The expectation is to remain true to our principles despite internal or external pressures, and to
eliminate short cuts and special

The Sarbanes Oxley Act Of 2002
The audit world was transformed more than ten years ago due to a series of accounting scandals.
This change took place when The Sarbanes–Oxley Act of 2002, otherwise known as SOX, was
passed affecting not only business entities but also the firms that audit those companies (Thomas).
One of the companies whose fraud was unmasked by the passage of SOX was HealthSouth
Corporation. A company in the healthcare industry who had overstated about $2.7 billion dollars in
earnings since 1996. The company's CEO, Richard Scrushy, was the first to be tried under SOX for
misrepresenting and signing off on misleading financial statements(Accounting Fraud at
HealthSouth).
HealthSouth Corporation was founded by Richard Scrushy in Birmingham, Alabama in 1984
(Stempel). Scrushy then became the CEO of the company and went public with it two years later
("Complaint"). Richard Scrushy was born and raised in Alabama (Hassan). He dropped out of high
school and attended The University of Alabama after obtaining his GED (Hassan). After graduating,
he was hired by the university where he was a professor for two and a half years (Hassan). He then
went to work at Lifemark Corporation, a healthcare management firm out of Houston, Texas. After
that, he left the company to form his own. Scrushy founded Amcare, an outpatient rehabilitation
facility who later was transformed into HealthSouth.
With his entrepreneur mind set, he wanted the company to expand fast. That it did, within a few
years the company

Ethics : Ethics And Ethics
Ethics
Ethics is a branch of philosophy that involves an organize system, defending, and recommending
concepts of right and wrong behavior. Ethics researches the two questions "What is the best way for
people to live?" and "What actions are right or wrong in particular circumstances?" Ethics attempts
to settle questions of moral behavior by defining what is good or bad and right or wrong. There are
three branches in ethics, meta–ethics, normative ethics, and applied ethics.
Meta–ethics deals with understanding judgements, attitudes, and statements. It examines what is
truthful. Normative–ethics is the study of moral action, the difference between right and wrong. It
examines the behavior of how one should act. Applied–ethics is what a person is obligated to do in a
professional disciplinary or a particular domain of action.
Ethics in Accounting
Accounting is a business field in which accuracy and interpretation are both very important. It
requires that Executives display leadership, honesty, and loyalty to employees and shareholders.
Ethics in accounting, is the practice of behavior that does not allow for intentionally inaccurate or
false accounting practices. This means not only must an accountant follow the law, but also be able
to interpret financial data as clearly and honestly in all situations. There have been several cases
where small discrepancies lead to sizeable sums of money being reported inaccurately, especially in
larger companies.
The data collected by

Training Other Healthcare Providers Of An Interprofessional
Background of Interviewee The interviewee completed her undergrad experience at the University
of South Carolina in Aiken, South Carolina in May 2010, majoring in Exercise Sports Science with
a concentration in Basic Science. In August 2010, the interviewee started a graduated program for
Occupational Therapy at Florida A&M University. She graduated in August 2013 and sat for boards
in December 2013. The interviewee started working at her first and current job at HealthSouth
Rehabilitation Hospital of Columbia in April 2013. C.Y. is currently still employed at HealthSouth.
Experience of Interviewee in IP teams C.Young (personal communication, June 3, 2015) was a new
graduate prior to working at HealthSouth. She only has one year ... Show more content on
Helpwriting.net ...
Benefits of working in IP teams Benefits of working in IP teams are numerous; you actually have
someone to consult with regarding your patient to establish treatment ideas and how to progress the
patient as much as possible. Also one may have noticed a deficit or skill you didn't, which increases
the ability to treat the patient as a whole. In an IP team, you get to see what other therapist is doing
during their treatment sessions, which will give you ideas to individualize for your own patients to
increase the progress. Also you have new graduates who have new and creative ideas, but you have
the seasoned therapist who can show you "tricks of the trade" to assist with achieving desired goals.
Working in this setting you have therapist who have different strong points in different areas,
therefore you know who to consult with regards to different conditions or injuries with patients
(C.Young, personal communication, June 3, 2015). Challenges of working in IP teams The
challenges of working in IP teams the interviewee notice is that when you and your partner do not
have the same work ethic, as well as agreement on treatment style to best suit the patient.
Sometimes while working in an IP team, some healthcare providers may have the tendency to take
over because one may not be doing what you want or feel is correct for the patient. A lot of times
you do not want to "step on other therapist toes" but you know deep down the patient should

Leadership Style Of The Chief Nursing Officer
This paper discusses the leadership style of the Chief Nursing Officer (CNO) at HealthSouth
Rehabilitation in Toms River, New Jersey. HealthSouth is the nation's largest inpatient rehabilitation,
there are HealthSouth's in 28 states and one in Puerto Rico. There are inpatient, outpatient, and
home health services. The mission statement of HealthSouth involves an advanced degree of
rehabilitative care to clients recovering from cerebrovascular accidents, cardiac and pulmonary
disorders, spine, and brain injuries and orthopedic disorders (Kosevich, Leinfelder, Sandin, Swift,
Taber, Weber, & Finkelstein 2014).
A CNO is the highest management positions in nursing. C.S. has been a HealthSouth employee for
over thirty six years and then worked her way up the management ladder. The CNO is considered
the principal representative for nurses and strives to support the nursing staff with the hospitals
morals and a mission statement. They ensure clinical and staffing standards, and patient care. The
CNO is responsible for counselling in high–ranking management and establishing benefit programs
for the nurses (Zydziunaite, Lepaite, & Suominen, 2013). S.C. has been a member of HealthSouth
for many years. She started as a floor nurse with an associates in nursing and moved up the ranking
to becoming the Chief Nursing Officer of HealthSouth in Toms River. S.C. now holds a master's of
science in nursing and is a nurse executive board certified. She's been the CNO for three years. She
was

Healthsouth Theoretical Model Of Fraud
I. Theoretical Model of Fraud A. Appropriate Fraud Model The best theoretical model of fraud to
describe why HealthSouth committed fraud is the fraud diamond not the fraud triangle. Both
methods require that these three elements are present for committing fraud: perceived pressure,
perceived opportunity, and rationalization. Understanding what motivated HealthSouth's Chief
Executive Officer (CEO) Richard Scrushy to commit fraud, how the accounting staff committed and
concealed the fraud, and how the staff justified their participation are crucial. However, anti–fraud
professionals believe that changes in social behavior require the addition of a fourth element called
capability. Capability includes "personal traits and abilities that play a major role in whether fraud
will actually occur" (Fighting Fraud in the Government n.d.). For example, Scrushy's persuasiveness
and Cathy Edward's position as Michael Vines' boss increased their capabilities to commit fraud. If
capable employees refused to participate, fraud occurrences decrease (Fighting Fraud in the
Government n.d.) (Hamilton n.d.). B. Fraud Scheme Committing fraud requires motivation from
perceived pressures like greed or meeting expectations. With the shift in investor focus and the need
to meet analyst expectations, Scrushy and the "family" manipulated earnings to make HealthSouth
appear more successful. Perceived opportunity establishes how an individual's position enables
fraud to be committed and

The Accounting Scandal Of Healthsouth

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