UofP - MBA560 - Individual Assignment - Week Six - 07-15-06

UofP - MBA560 - Individual Assignment - Week Six - 07-15-06...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Problem Solution 1 Problem Solution: CareNetWest Companies, Inc. Robert Sikes MBA560 Ray November July 15, 2006
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Problem Solution 2 Problem Solution: CareNetWest Companies, Inc. This paper will illustrate the overall situation with CareNetWest Companies, Inc. identifying challenges and opportunities. It will further describe key stakeholders, the desired end state, goals, and develop a problem statement. Situation Background CareNetWest Companies, Inc. (CareNetWest)—under the direction of Chairman and CEO, Dr. Tad Smith, a licensed medical doctor and cardiovascular surgeon—grew in both dimension and financially due to the development of a groundbreaking surgical technique involving valve disorders. In 2001, CareNetWest incorporated in Delaware and raised $500 million in IPO capital. Using its newfound capital and marketable shares, CareNetWest ultimately acquired six smaller networks along the Interstate Highway 5 corridor stretching from San Francisco to Seattle. In 2002, CareNetWest was the third largest hospital chain west of the Mississippi and traded on the New York Stock Exchange. Near the end of 2002, CareNetWest had a five-person Board of Directors composed entirely of medical professionals; however, there existed no audit, governance, or compensation committees. As CareNetWest grew—and in the wake of Sarbanes-Oxley—questions arose regarding whether the company’s infrastructure was leveraged correctly and if current staff members possessed the strength and expertise for growth sustainability. Issue Identification CareNetWest has been confronted with several challenges that could impair positioning the company for growth sustainability including a substantive enterprise risk management function, Sarbanes-Oxley internal controls compliance, corporate governance policies including business ethics, and incorporating Sarbanes-Oxley into its business model in order to meet initial
Background image of page 2
Problem Solution 3 and sustained compliance objectives. Furthermore, CareNetWest is governed by statutes at both the federal and state levels of government including—but limited to—the Securities and Exchange Commission (SEC) and the Public Company Accounting Oversight Board (PCAOB) who can impose a variety of sanctions for violating statutes or regulations adopted to accomplish statutory purposes, including the Sarbanes-Oxley Act of 2002 (Reed, 2005). Opportunity Identification Enterprise Risk Management—Sarbanes-Oxley Post-Enron and other corporate malefactors, Congress—including the Securities and Exchange Commission (SEC), major stock exchanges, and other interested parties—sought to establish greater control over financial and corporate activities of publicly-held companies and their officers and directors (University, 2006). Concerned about negative impact these scandals might have on long-term investor confidence in the U. S. capital markets, Congress set a primary goal of righting the wrong. Therefore, in 2002, Congress passed the Sarbanes-Oxley (SOX) Act.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 23

UofP - MBA560 - Individual Assignment - Week Six - 07-15-06...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online