Show:
Sarbanes-Oxley Act
Auditor Mistakes
HealthSouth
Fraud Triangle
Accounting Fraud Miscellaneous
100
What year was Sarbanes-Oxley Act established?
2002
100

The firm who audited HealthSouth

EY

100
What year did HealthSouth miss their first earnings target?
1996
100

The three parts of the fraud triangle 

Oppertunity, Pressure, Rationalization 

100
The obligation of a company to assess and be accountable for the company's effects on environmental and social well being?
Corporate Social Responsibility (CSR)
200
Who is the Sarbanes-Oxley Act named after?
Senator Paul Sarbanes and Representative Michael Oxley.
200

The amount that earnings were inflated 

1.8 Billion

200
How many people were indicted of criminal charges for the HealthSouth Scandal?
17
200

The opportunity for the fruad to take place 

CFO's had final say of adjustements to the financial statements

200

How would the magnitude of the HealthSouth scandal be changed if SOX had been enacted prior?

Stronger internal controls, audit independence, more accountability

300
What was the main thing SOX set out to prevent?
Accounting Fraud
300

Basic auditing procedures that weren't done

Horizontal and Vertical Analysis, bank confirmation of cash balances 

300

The year the fraud ended 

2003

300

The Pressure that the CFOs faced to commit fraud 

Aggressive EPS projections by market analysis 

300

Amount lost to fraud in 2022 - answer within $1 billion

$8.8 billion

400
Name one company that caused the creation of SOX?
Enron, Waste Management, and WorldCom.
400

How the fraud was committed 

mergers and acquisitions, false cash statements, false reserves, and false statements on balance sheets.

400

A HealthSouth CFO who confessed to signing materially false financial statements. 

Michael Martin & Malcom McVay

400

The rationalization of CFOs to commit fruad 

That it would be temporary 

400
How was HealthSouth's scandal effected by SOX?
It was brought to a halt.
500
What is one of the three areas of financial standards that SOX was able to put a clamp on?
Corporate Governance, Security Analysis, Audit Work
500

Wistleblower who was ignored 

Michael Vines 

500

Who was the CEO and owner of HealthSouth and what was he indicted for?

Richard Scrushy Racketeering, Money Laundering, Extortion, Obstruction of Justice, and Bribery of Governor Don Siegelman. 

500

What could have stopped the fruad triagle from being complete for Healthsouth. 

Best chance would be reducing oppertunity- Strong internal controls to reduce oppertunity, transaction monitoring 

500

The percentage of fraud found through external audits 

4%