UofP - MBA560 - Team Assignment - Scenario Two Benchmarking - Team - 07-08-06

UofP MBA560- - Week 5 Benchmarking 1 Week 5 Benchmarking CareNetWest Inc Learning Team B Robert Sikes Phillip Hinkle Albert Garcia Candace Frawley

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Week 5 Benchmarking Week 5 Benchmarking- CareNetWest Inc. Learning Team B: Robert Sikes Phillip Hinkle Albert Garcia Candace Frawley Thadeaus Jones Enterprise Risk MBA 560 Ray November July 8, 2006 1
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Week 5 Benchmarking Introduction The purpose of this paper is to benchmark companies and agencies that have brought themselves into compliance with the same regulations CareNetWest is currently facing. This paper includes an analysis of the CareNetWest situation, knowledge of how the research was conducted, viable benchmarking information and results, a list of alternative solutions and an analysis of risk and mitigating risk. Situation Analysis CareNetWest Companies Inc. is a eighty 100 – 500 bed, full service, acute and general care hospitals spanning the west coast of the United States, encompassing California, Oregon, and Washington. A publicly traded company, the driving force behind the company’s growth Dr. Tad Smith was nominated by the Board of Directors to act as both Chairman and CEO. The entire board of directors is made up of five medical professionals, four doctors and one clinical social worker with a doctorate. Currently CareNetWest has little to no corporate governance outside the CEO, board of directors and other executive officers of the company. The company replies heavily on Dr. Tad Smith’s direction when addressing corporate matters. The company has no controller only a CFO who has outsourced all the accounting to an accounting firm known as Big Four. Recently the companies Chief Risk Officer (CRO) has resigned rather abruptly. In her letter of resignation to Dr. Smith she states that one of her main reasons for leaving the company is that she is getting no guidance in regulatory reporting financial areas from the CFO and the companies General Counsel. Furthermore she states her regrets in 2
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Week 5 Benchmarking leaving during two major risk management issues, the 2003 joint commission review and Sarbanes-Oxley sections 404 compliance. Dr. Smith is caught complete off guard by her resignations and turns to his CFO whom he discovers has done little to assist the former CRO, as she described. Moreover, the CFO reveals that the 2003 joint commission deals with the Hospitals receiving Medicare and Medicaid monies and is a big deal. Yet has done nothing to ensure the companies are in compliance! Dismayed that the CFO knows so little about these issues Dr. Smith consults with the General Counsel and the accounting firm Big Four, these sources reveal a need to come into compliance with new corporate governance regulations and form some committees to regulate reporting practices. Conducting the Research CareNetWest’s problems with corporate governance compliance are due to lack of internal expertise; this has forced the company to address the issues above. Compliance is needed in the following areas: Sarbanes-Oxley, corporate governance, and
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This note was uploaded on 06/12/2011 for the course ETHICS mba taught by Professor Wilkes during the Spring '05 term at University of Phoenix.

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UofP MBA560- - Week 5 Benchmarking 1 Week 5 Benchmarking CareNetWest Inc Learning Team B Robert Sikes Phillip Hinkle Albert Garcia Candace Frawley

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