In 1962 Rite Aid opened its first store called the Thrift D Discount Center which ended up growing rapidly and in 1968 changed its name to Rite Aid Corporation (David & David, 2015, pg. 400). Rite Aid Corporation is considered to be the third largest drugstore in the US amongst its competitors with over 4,000 drugstores. Walgreens, CVS Caremark, and Mail-Order Drugstores are Rite Aid’s competition. Just like any other organization, Rite Aid does have some internal and external issues. Those internal and external issues would need some improvement in order for the organization to stay competitive against its competitors in the future.
...fers (2011) considers this as act to hide LBs unhealthy situation and showing a rosy picture for a purpose of positive grading from rating agencies. Valukas (2010) commented that this helped the company remove billions of dollars in commitments and so artificially improve the balance sheet. Further, Jeffers (2011) added that due to complex structure of the company manipulative and fraudulent activities were well masked and this cause difficulty to reveal or monitor such shadow activities for financial regulators. This shows that LBs manipulated its financial position to display a healthier picture of the company, which improved their leverage ratio and issued fictitious positive results to investors, regulators and others (Jeffers & Yang, 2008). LBs clearly failed to comply with law due to failure to disclose an alleged material fact and using misleading statements.
Due to such lack of monitoring, management continued to be unaware of such transactions that continued to impact the company negatively. This provided the Rigas family many opportunities to override controls since the lack of corporate governance enabled the decisions to be made by Rigas family without oversight. For example, the article “Adelphia Officials are Arrested, Charged with ‘Massive’ Fraud” discuses how Timothy Rigas had to limit himself to $1 million a month of compensation that was withdrawn from the company for personal use. All decisions were continuously made by such members of the family, in which case for Adelphia, was the team of management. With the lack of controls creating opportunity, they were free to do what they wished- which is something they took incredible advantage
I worked for the drugstore chain Walgreens in the early 2000’s and was involved in a situation where employees were asked to perform work off the clock. The incident occurred when Walgreens was preparing to open a new store in Los Banos, Ca. The company had a tight deadline for getting the store to an operational state, requiring huge tasks in a short amount of time. As the scheduled opening date approached it was clear the store was not on track to be ready for business by the opening date. Management and lower level employees were all feeling the pressure to do work faster and harder in order to catch up.
Case 4: In this case, The PCAOB found that Ligand Pharmaceuticals restated the financial statements for the year 2003, and recognized around $59 million less in revenues from product sales than originally recognized and reported a net loss more than 2.5 times the net loss originally reported. As a result, PCAOB ordered that James was prohibited from associating with any registered public accounting firm for at least two years from the date of its order.
Though, in the case of Martha Stewart and Peter Bacanovic, I do not agree with their sentencing. Honestly, I think the judge was too lenient. In my opinion, five months in jail and five months on house arrest is a cake walk compared to others that have committed similar types of crimes. For example, Rajat Gupta was convicted of insider trading, one count of conspiracy to commit securities fraud, and three counts of securities fraud. Gupta was sentenced to two years in prison and one year of supervised release. However, he did have to pay a larger fine than Martha Stewart, which was a $5 million criminal fine (SEC,
Profits were inflated by $1.7 billion to meet earnings targets which resulted in investors losing more than six billion dollars while the perpetuators made their illegal loot. The officers were engaged in improper accounting practices to achieve their selfish objectives. These practices included among others: excluding depreciation charges on their garbage trucks, extending their useful lives, capitalized operating expenses and failed to make provisions to pay income tax and other expenses. In addition, Arthur Andersen, has been appointed auditor for a considerable period and issued unqualified audit opinions on accounts which contained many fraudulent
Profits were inflated by $1.7 billion to meet earnings targets which resulted in investors losing more than six billion dollars while the perpetuators made their illegal loot. The officers were engaged in improper accounting practices to achieve their selfish objectives. These practices included among others: excluding depreciation charges on their garbage trucks, extending their useful lives, capitalized operating expenses and failed to make provisions to pay income tax and other expenses. In addition, Arthur Andersen, has been appointed auditor for a considerable period and issued unqualified audit opinions on accounts which contained many fraudulent
Sunbeam committed the following two fraud schemes while Al Dunlap was the company’s Chief Executive Officer (CEO): (1) Improper Timing of Revenue Recognition via Bill Hold Sales, Consignment Sales, and Other Contingency Sales and (2) Overstating Earnings via Improper Use of Restructuring Reserves. A series of detection methods were utilized in each fraud scheme to determine the indicators that proved that Sunbeam was involved in manipulating its financial data. The most utilized method for detecting Sunbeam’s fraud was Financial Statement Analysis. Utilization of Annual Reports and Disclosures were utilized just as much as Corporate Research and Media while Business Plan Analysis was ranked as being the fourth most used. Finally; leadership
...t penalty be instituted and the need for top management to certify the accuracy of financial information to reduce the occurrences of fraud should be implemented. The company should initiate proper control and recording process. All transactions should be carefully analyzed, documented in a journal and posted into ledger accounts. An honest external auditor should be used.
In (Complaint 17588)we find that they were directly involved in a fraudulent improper accounting scheme. With the intent to manipulate said earnings to keep them on point with Wall Street's expectations as well as support WorldCom's stock price.
As what it came to be as one of the notorious case of fraud in the mid-1980s; the electronic store well known as (Crazy Eddie), its owner Eddie Antar and CFO Sam Antar committed every possible act fraud there is. Just to mention two of which they perpetrated; tax evasion and securities fraud. Basically, the tax evasion was committed for many years, it was not until the company became public in 1984 that their wrong doing near its end. Once Crazy Eddie went public, a new set of rules took place, such as compliance with the Securities Exchange Commission and the scrutiny of its investors. Soon, they both realized that their long committed fraud was nearing its end, when an external audit found the real numbers on the company’s inventory, revenues,
Rite Aid Corporation which ranks as the third largest retail drugstore chain in the United states, control about 2,380 drugstores in 28 states across professionals pharmacy service, a full selection of health and personal care products, an assortment of general products in the nation and in the District of Columbia ( Rite Aid, 2007 ). Rite Aid has a great management team to help them with their success their team includes Chairman, President and Chief Executive Officer, Special Advisor, Corporate Strategy ,Chief Operating Officer ,Chief Administrative Officer ,Executive Vice President – Pharmacy, Executive Vice President, Store Operations ,Executive Vice President and General Counsel( Rite Aid, 2007). Differentiate between management and leadership is very different for example, response to its huge losses, Rite Aid has said it expects to spend more than $94 million to reassess and restate its financial results for 1998 and 1999( ). Furthermore, that includes rerunning mainframe-based accounting systems and paying IT people overtime to work with internal and external accountants and auditors during the process. Still, Rite Aid does not plan to replace its combination homegrown Computer Corp. accounting system
One may ask, how is that different from the “Enron” scandal? There isn’t much to separate these two, it could be said that they are cousins. They both managed to cover their debts by overstating their revenue and profits and using other companies they owned to make profit or at least attempted to, but ultimately drowning in debt and committing fraud. What makes these two companies different would be the cooperation of the executives with the prosecutors or officials, which goes back to why Andrew Fastow only faced 10 years because he took a plea deal. On the other hand I believe 25 years for conspiracy, misrepresentation of statements and 7 counts filing false statements was well deserved because not only did that make a statement to the public, but in the eyes of the law Ebbers should have learnt from “Enron’s”
Financial: A corrupt company will lose customer respect and trust, requiring that the company’s management spend valuable time and resources to keep their clientele loyal and demonstrate that they still operate a viable business. The public, overa...