Assignment: US Surgical Case Essay

An implicit theme of this case that I want students to recognize is the contrast between the persistent and vigorous efforts of David Sokol to “get to the bottom” of the suspicious items he uncovered in JWP’s accounting records versus what Judge William Conner referred to as the “spinelessness” of JWP’s auditors. The JWP audits were similar to most problem audits in that the auditors encountered numerous red flags and questionable entries in the client’s accounting records but, for whatever reason, apparently failed to thoroughly investigate those items. On the other hand, Sokol refused to be deterred in his investigation of the troubling accounting issues that he discovered. The relationships that existed between members of JWP’s accounting staff and the Ernst & Young audit team apparently influenced the outcome of the JWP audits. Of course, the Sarbanes-Oxley Act of 2002

1.) What is the marginal cost estimate of the Phase 4 hospital services, assuming that 60 percent of the designated costs are fixed and the remaining costs are variable?

2. What procedures can auditors perform to detect fraudulent entries made during the consolidation process?

The acquisition and post-acquisition period for Mt. Mercy Hospital/Sister Mary Theresa’s purchase of Abbott Hospital experienced several organizational change issues. Within Dr. Belasen’s corporate communications model “CVFCC,” several quadrants became compromised. During the acquisition period, conflict arose within the realm of Investor Relations and Government Relations. Conflict continued to arise after the acquisition – specifically within the quadrant of Employee Relations.

During Hydromaint's audit, you and Pam had a number of discussions. You, Pam, and Mike Johnson are generally satisfied that the accounts are in accordance with GAAP and are supported by underlying facts. Pam tested Jerry's pension accounting (which she found to be correct) by preparing a pension worksheet based on data contained in the actuary's report:

HISTORY OF PRESENT ILLNESS: Patient is a candidate for a total right hip revision. She has 2 units of directed packed red blood cells. It is not autologous. She does had Hepatitis B. She has arthrogryposis. She had a right total hip replacement many years ago by Dr. Dodd at the University of Miami. She has had multiple other surgical procedures as follows. A: She had bilateral foot surgery In the remote past. B: She had left hip surgery a year ago. C: She had right foot

How would Ed’s blood help protect him from a foreign invader such as the one now in his system?

Big Bend Medical Center is a full-service, not-for-profit, acute care hospital with 325 beds located in Big Bend, Texas. The bulk of the hospital’s facilities are devoted to inpatient care and emergency services. (Gapenski, pg. 27) The outpatient services section of the hospital is used by the Outpatient Clinic, as well as the Dialysis Center. The Outpatient Clinic, which makes up about 80 percent of the outpatient services section, has recently grown in volume and has created a need for 25 percent more space than it currently has. Moving the Dialysis Center to a new building was decide to allow expansion of the Outpatient Clinic. A change and focus on the allocation of costs has some department heads angry and claiming of

b. What will its future value be if the CD pays 5 percent interest? If it pays 15 percent interest?

1. Using the historical data as a guide (Exhibit 6.1), construct a pro forma (forecasted) profit and loss statement for the clinic's average month for all of 2010 assuming the status quo. With no change in volume (utilization), is the clinic projected to make a profit?

1. Under HIPAA, are you legally allowed to view this patient’s medical information? Why or why not?

Gauthier, S. J. (n.d.). Better Understanding of The Financial Statement Audit. Retrieved 06 26, 2011, from

"... Further to conclude you are now suspended until investigations are complete" Guy's face did not change from his usual blank, yet smug expression. Internally, he appeared to get a kick from this experience.

1) Identify audit procedures that, if employed by Ernst & Whinney during the 1981 USSC audit, might have detected the overstatement of the leased and loaned assets account that resulted from the improper accounting for asset retirements.

The call centre of the Eastern Medical Faculty Foundation, hereafter referred to as EMFF, provides a competitive advantage to the Internal Medicine Department of the Chicago School of Medicine through the delivery of efficient and high quality service to patients. Treating patients generates revenue the Internal Medicine Department and contributes to investments in research in the highly competitive healthcare sector. Unfortunately, declining customer satisfaction, as evidenced in a growing number of customer complaints, suggests the quality of service is deteriorating and threatens the very competitive advantage of the EMFF.