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Short note on risk assessment
Short note on risk assessment
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WHAT WAS THE HIH BOARD DOING WHILE THIS SAGA WAS GOING ON? WHAT SHOULD THEY HAVE DONE?
Acquisitions and expansions
A review of the chronology of key events, as published by the HIH Royal Commission, will show that the leadership of HIH Insurance has made a series of acquisitions both local and international. As discussed in Wikipedia online (2014), through 1997 and 1998, HIH Winterthur acquired a large number of companies both in Australia and globally, including Colonial Ltd General Insurance's operations in Australia and New Zealand, Solart in Argentina and Great States Insurance Co in the United States. HIH acquired the large Australian insurance company FAI Insurance, whose chief executive Rodney Adler became a director of HIH in 1999.
In the documentary HIH : The Inside Story Of Australia's Biggest Corporate Collapse (Westfield, M. 2003), the story of HIH Insurance’s collapse was aptly described as being due to the management’s gross mismanagement, largely charging too little for premiums and failing to put away enough to pay out claims. The HIH leadership concealed financial losses by under-reserving (which boosts profits) and using "financial reinsurance" contracts to turn losses into gains. Williams, the chief executive, distracted the investment community with a string of takeovers, culminating in paying $300 million for Rodney Adler's FAI Insurances in 1998.
Focusing on expansion while neglecting monitoring of financial situation
From the year 1997 to 1999, a mere span of 3 years, HIH Group made 7 acquisitions (Colonial General Insurance in 1997; Solart of Argentina in 1998; Nang Sen Insurance in February 1998; Cotesworth Group Ltd in April 1998; Great States Insurance Co of Arizona in June 1998; FAI Insur...
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...imited – FAI was implementing detrimental provisioning practices, including among others failure to monitor claims lower than $100,000 and lack of clear methodology on how claims estimates were monitored. These reports were made in 1997, a year before HIH announced its proposed takeover of FAI in September of 1998.
Due diligence and proper research would have warned HIH of the losing proposition of acquiring FAI, which was completed in 1997.
As the leadership body of HIH, the board of directors should have come up with plans to improve its research and investigating capability with respect to targeting possible acquisitions. The board of directors could have considered even forming a separate committee dedicated for this purpose. Unfortunately, the core group of HIH gave weight to persuasion from its members, particularly Adler, to approve the acquisition.
In the year of 2005, the companies eventually found a way to make it easier for the companies to combine without having any major issues or problems. Unfortunately, around the year of 20010 the merging com...
According Banner Healthcare (2016), “BHN collaborates with many commercial and government payers, plus large employer groups, to deliver on the triple aim of lower costs, high quality care and an excellent patient experience. Healthcare can be affordable with a design that engages the physician, patient and payer in seeking the best care and health outcomes” (p.2).
In the Lester Electronics Scenario, there are several things going on at once. Shang-Wa had already suggested a partnership to Lester Electronics, but this is now becoming more urgent due to a hostile takeover bid by TEC. In fear of losing
A documentary film released in 2005 called the Smartest Guys in the Room reveals the shocking collapse of Enron. The Smartest Guys, Kenneth Lay, Jeff Skilling, Andrew Fastow, Lou Pai, Clifford Baxtor, and Arthur Anderson, were all involved with America’s ultimate Corporation Scandal. But who do we blame? Enron had over 20,000 employees and was founded by Kenneth Lay, CEO of Enron, in 1985. Lay wanted to push his views of deregulation which pushed him to start the company (SGR). The first event that happened leading up to the downfall was the president, Mr. Borget, and his traders manipulating the company’s earnings and exporting the profits to their personal account. When Lay made the decision to not fire them, it definitely raised the
Gaughan, P. A., 2002. Mergers, Acquisitions, and Corporate restructuring. 3rd ed.New York: John Wiley & Sons, Inc.
I wish to look into the Health Care and in this case I need to look into FTC Universal health facilities. The merger is intended to take place between it and another health care providing institution known as Psychiatric Solutions. The acquisition of the organization was estimated to cost close to $ 3.1 billion and it would have been the best thing to do in running of the organization (F.T.C, 2011). Merging the two organizations would be very effective in reducing the competition between other organizations that provide psychiatric services to patients especially in Delaware, Las Vegas, Nevada and Puerto Rico.
McFarlan, F. Warren. CareGroup. Ed. Robert D. Austin. N.p.: Harvard Business School, 2005. 1-22. Print.
Mr. Torbett, in the case about the Home Builders Institute (HBI), I noticed some key problems related to the Structural, Human Resources, Political and Symbolic frames. I will go through each of these problems in order to identify which frame it relates to, what the problem is, why it was caused, a recommendation for fixing the problem and any possible ramifications. This will provide some potential future step as you progress in your journey at HBI.
Hit Where it hurts why HMO profits are shrinking fast. (1997, October 27, 1997). Business Week, 42 - 43. Retrieved from http://web.ebscohost.com.ezproxy.gracedland.edu
Business Insurance News, Analysis & Articles. Web. The Web. The Web.
When I looked over the list of possible interest groups that I could choose from Health Insurance Association of America (HIAA) automatically stood out to me. I chose this interest group because my major is Physical Therapy and I figured it would be interesting to track this semester because of the changes currently happening in health care right now. I had never heard of this interest group before so I had to find their website. When I started searching for it I had some difficulty finding it because another interest group kept coming up called America's Health Insurance Plans (AHIP). I kept looking at it and found out that HIAA had merged with American Association of Health Plans (AAHP) to form America's Health Insurance Plans (AHIP). America's Health Insurance Plan's URL is www.ahip.org that they use to post updates.
Lublin, J. S., & Carrns, A. (2003, April 11). Directors had lucrative links at HealthSouth. Wall Street Journal. p. B1. Retrieved from: http://search.proquest.com.proxy1.ncu.edu/docview/398944990?accountid=28180
This is a publicly traded company in the US that has been ding quite well in the recent years. The company’s 10k filing for the year 2014. From this statement, the risks facing the company will be identified classified and suggestions made on how best to mitigate them in the subsequent areas. There are various areas that the risks can arise based on the company’s 10k filling (Mertz, 1999).
Prior to 2000, Enron was an American energy, commodities and service international company. Enron claimed that revenue is more than 102 millions (Healy & Palepu 2003, p.6). Fortune named Enron “American most innovative company” for six consecutive years (Ehrenberg 2011, paragraph 3). That is the reason why Enron became an admired company before 2000. Unfortunately, most of the net income for the years 1997-2000 is overstated because of unethical accounting errors (Benston & Hartgraves 2002, p. 105). In the next paragraph, three main accounting issues will identify for what led to the fall of Enron.
The actions that were taken by Kenneth Macke to assist the company with the their takeover situation were an example of how business relies on the government to be responsible for social issues. When pleading their (DHC) case to the governor, Dayton Hudson made sure to make know all of the contributions that they have made to the community and how they have provided safe and secure jobs for its residents. They claimed that if they were to be taken over, the Haft’s would probably break up the company and sell it off to pay for the expenses incurred from the takeover. Jobs would be lost and there would most likely be no social contributions made by the Hafts.