Business Scandal

Topics: Audit, Auditing, Internal control Pages: 4 (1189 words) Published: July 26, 2013
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1) CORPORATE CULTURE
Corporate culture and ethics are very important source to sustain positive working environment in an organization. Based on the pattern that caused the fraud, the management style of HealthSouth is clearly practice very authoritative which the reason for Richard orders fulfilled dutifully in order to partake in the fraudulent schemes. It’s clearly stated that the company not practicing a strong code of ethics. It has been proved that an effective antifraud environment is a culture with a strong value system founded in integrity. The value system is reflected in a code of ethics. The code of ethics of HealthSouth Corporation should reflect the core values of the company and guide employees in making appropriate decisions during their workday. The elements of code of ethics include confidentiality, conflict of interest, intellectual property, sexual harassment and fraud. HealthSouth Corporation should develop a comprehensive code of ethics, which shall be well-communicated to each employee. Each employee shall sign a statement that they have received and understand the code of ethics. The code of ethics shall be included in an employee handbook or policy manual so that it can be referred to when needed. Training and seminar provides guides for management to practice a strong code of conduct and also will create awareness on whistle blower program. New employees should be trained at the time of hiring about the company’s values and its code of ethics. This training should explicitly cover expectations of all employees regarding their duty to communicate certain matters, a list of types of matters including actual or suspected fraud to be communicated along with specific examples and information on how to communicate those matters. In addition to training at the time of hiring, employees will have knowledge regarding whistle blower program. They will come forward to expose the fraud to related parties as they know that...

References: 1) http://www.arxisfinancial.com/images/pdfs/Fraud-Health_South_Case.pdf
Retrieved on 20 July 2013
2) http://www.investopedia.com/terms/r/riskmanagement.asp
Retrieved on 21 July 2013
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