Slippery Slope
VP 5 Slippery Slope-HealthSouth Questions:
1. Summarized the Video.
Aaron Beam discusses with Stanford Graduate students his start of his career as a newly certified CPA. His career started at Life Mart where he meets Richard Scrushy who wastes no time on sizing up Aaron Beam. However, Life Mart is acquired a couple years later jeopardizing the employment of Aaron Beam, however, venture capitalists ask if anyone has a company idea to start up and Richard Scrushy’s name is thrown out. Richard Scrushy proposes to Aaron Beam to be his partner in starting up South Health; two years later, South Health becomes a publicly traded company. Since their wealth is tied to the stock price, Scrushy is constantly in contact with Wall Street analyst to constantly improve their numbers. In order to meet Wall Street’s demands they begin manipulating bad debt expenses and soon begin to produce multiple fraudulent revenue entries into their 1,500 journals. A year later Beam leaves the company after lying to auditors and not agreeing with cooking the books. He distances himself from the company, only to later be asked by Scrushy to come back and help him grow the company more, he states that the fraud has stopped. Beam does not return and years later the fraud is uncovered. When Beam and other accountants step forward, Scrushy denies any involvement. Many accountants take a plea but Scrushy goes to court only not to be found guilty by the jury. Beam receives 3 months in prison and is now a felon.
2. Who are the main characters of the video?
Aaron Beam – Started his career alongside Richard M. Scrushy at Life Mart in Houston, Texas, Life Mart eventually became acquired. Together with Richard Scrushy they became founders of Health South a health care company that focused on outpatient services. Aaron Beam served as the CFO of HealthSouth; however, since their wealth was tied to the price of stock it soon became hard to meet market expectations which eventually lead the
1. Summarized the Video.
Aaron Beam discusses with Stanford Graduate students his start of his career as a newly certified CPA. His career started at Life Mart where he meets Richard Scrushy who wastes no time on sizing up Aaron Beam. However, Life Mart is acquired a couple years later jeopardizing the employment of Aaron Beam, however, venture capitalists ask if anyone has a company idea to start up and Richard Scrushy’s name is thrown out. Richard Scrushy proposes to Aaron Beam to be his partner in starting up South Health; two years later, South Health becomes a publicly traded company. Since their wealth is tied to the stock price, Scrushy is constantly in contact with Wall Street analyst to constantly improve their numbers. In order to meet Wall Street’s demands they begin manipulating bad debt expenses and soon begin to produce multiple fraudulent revenue entries into their 1,500 journals. A year later Beam leaves the company after lying to auditors and not agreeing with cooking the books. He distances himself from the company, only to later be asked by Scrushy to come back and help him grow the company more, he states that the fraud has stopped. Beam does not return and years later the fraud is uncovered. When Beam and other accountants step forward, Scrushy denies any involvement. Many accountants take a plea but Scrushy goes to court only not to be found guilty by the jury. Beam receives 3 months in prison and is now a felon.
2. Who are the main characters of the video?
Aaron Beam – Started his career alongside Richard M. Scrushy at Life Mart in Houston, Texas, Life Mart eventually became acquired. Together with Richard Scrushy they became founders of Health South a health care company that focused on outpatient services. Aaron Beam served as the CFO of HealthSouth; however, since their wealth was tied to the price of stock it soon became hard to meet market expectations which eventually lead the