What’s the best company culture. How will that organization ensure that the company culture continues through the years?

also, what is the role of the individual in the organization? Consider everyone from the janitor to the CEO.?

In April 1993, Dr. Nancy Olivieri, head of the hemoglobinopathy program at the Hospital for Sick Children (HSC), the teaching hospital for the University of Toronto in Canada, signed an agreement with the Canadian drug company Apotex to undertake clinical trials on a drug called deferiprone (referred to as L1 during the study). The drug was designed to help children with thalassemia, an inherited blood disorder that can cause the fatal buildup of iron in the blood. The agreement that Olivieri signed with Apotex included a clause (later referred to as a “gag clause”) that specifically prevented the unauthorized release of any findings in the trial for a period of three years: As you now [sic], paragraph 7 of the LA-02 Contract provides that all information whether written or not, obtained or generated by you during the term of the LA-02 Contract and for a period of three years thereafter, shall be and remain secret and confidential and shall not be disclosed in any manner to any third party except with the prior written consent of Apotex. Please be aware that Apotex will take all possible steps to ensure that these obligations of confidentiality are met and will vigorously pursue all legal remedies in the event that there is any breach of these obligations. The existence of this clause was to prove significant to the relationship between Olivieri and Apotex. After reporting some initial positive findings in the trial in April 1995, Olivieri reported in December 1996 that long-term use of the drug appeared to result in the toxic buildup of iron in the liver of a large number of her pediatric patients—a condition known as hepatic fibrosis. When she reported the findings to Apotex, the company determined that her interpretation of the data was incorrect. Olivieri then contacted the hospital’s Research Ethics Board (REB), which instructed her to change the consent form for participation in the trial to ensure that patients were made aware of the risks of long-term use of the drug. After copying Apotex on the revised form, the company notified Olivieri that the Toronto trials were being terminated effective immediately and that she was being removed as chair of the steering committee of the global trial that included patients in Philadelphia and Italy. When Olivieri notified Apotex that she and her research partners, including Dr. Gary Brittenham of Case Western Reserve University in Cleveland, were planning to publish their findings in the August 1998

issue of the New England Journal of Medicine, Apotex Vice President Michael Spino threatened legal action for breaching the confidentiality clause in her agreement with the company. Olivieri then asked the HSC administration for legal support in her forthcoming battle with Apotex. The administrators declined. She then approached the University of Toronto, where the dean of the Faculty of Medicine declined to get involved on the grounds that her contract with Apotex had been signed without university oversight and that the university would never have agreed to the confidentiality clause in the first place. Olivieri forged ahead with the publication despite this [lack of support] and instantly became celebrated as a courageous whistle-blower in the face of corporate greed. The situation was further clouded by reports that the University of Toronto and HSC were, at the time, in the process of negotiating a $20 million donation from Bernard Sherman, the CEO and founder of Apotex. The bitter relationship with her employers was to continue for several years, during which time she was referred to the Canadian College of Physicians and Surgeons for research misconduct and dismissed from her post at HSC, only to be reinstated following the aggressive support of several of her academic colleagues, including Dr. Brenda Gallie of the Division of Immunology and Cancer at HSC, who led a petition drive that succeeded in garnering 140 signatures in support of a formal enquiry into Dr. Olivieri’s case. That enquiry was undertaken by both the Canadian College of Physicians and Surgeons, which found her conduct to be “exemplary,” and by the Canadian Association of University Teachers, whose 540-page report concluded that Dr. Olivieri’s academic freedom had been violated when Apotex stopped the trials and threatened legal action against her. The two-and-a-half-year battle ended in January 1999 when an agreement was brokered between the university, HSC, and Olivieri thanks to the efforts of two world-renowned experts in blood disorders—Dr. David Nathan of Harvard and Dr. David Weatherall of Oxford who intervened on the basis of the international importance of Dr. Olivieri’s research. Working with the president of the University of Toronto, Robert Pritchard, and lawyers for both parties, a compromise settlement was reached that reinstated Olivieri as head of the hemoglobinopathy program at HSC, covered her legal expenses up to $150,000, and withdrew all letters and written complaints about her from her employment file. As part of the agreement, a joint working group appointed by the University of Toronto and the university’s Faculty Association was chartered with the task of making “recommendations on changes to university policies on the dissemination of research publications and conflict of interest and the relationship of these issues to academic freedom.”

1. Was it ethical for Apotex to include a three-year gag clause in the agreement with Dr. Olivieri?

2. Even though Dr. Olivieri later admitted that she should never have signed the agreement with Apotex that included a confidentiality clause, does the fact that she did sign it have any bearing on her actions here? Why or why not?

3. Was Olivieri’s decision to publish her findings about the trial an example of universalism or utilitarianism? Explain your answer.

4. If we identify the key players in this case as Dr. Olivieri, Apotex, the Hospital for Sick Children, and the University of Toronto, what are the conflicts of interest between them all?

5. What do you think would have happened if Dr. Olivieri’s fellow academics had not supported her in her fight?

6. How could this situation have been handled differently to avoid such a lengthy and bitter battle?

On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month.

The company's chart of accounts follows:

Use the following information:

1. Two-thirds (or $128) of one month’s insurance coverage has expired.
2. At the end of the month, $600 of office supplies are still available.
3. This month’s depreciation on the computer equipment is $400.
4. Employees earned $380 of unpaid and unrecorded salaries as of month-end.
5. The company earned $2,000 of commissions that are not yet billed at month-end.

Required:
1. & 2. Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company records prepaid and unearned items in balance sheet accounts.
3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30.

Worley Company buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Worley sets its prices for all hospitals by marking up its cost of goods sold to those hospitals by 9%. For example, if a hospital buys supplies from Worley that cost Worley $100 to buy from manufacturers, Worley would charge the hospital $109 to purchase these supplies.

For years, Worley believed that the 9% markup covered its selling and administrative expenses and provided a reasonable profit. However, in the face of declining profits, Worley decided to implement an activity-based costing system to help improve its understanding of customer profitability. The company broke its selling and administrative expenses into five activities as shown:

Worley gathered the data below for two of the many hospitals that it serves—University and Memorial (each hospital purchased medical supplies that had cost Worley $32,000 to buy from manufacturers):

Required:

1. Compute the total revenue that Worley would receive from University and Memorial.

2. Compute the activity rate for each activity cost pool.

3. Compute the total activity costs that would be assigned to University and Memorial.

4. Compute Worley’s customer margin for University and Memorial. (Hint: Do not overlook the $32,000 cost of goods sold that Worley incurred serving each hospital.)

1

2

3

4

2.

Worley Company buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Worley sets its prices for all hospitals by marking up its cost of goods sold to those hospitals by 7%. For example, if a hospital buys supplies from Worley that cost Worley $100 to buy from manufacturers, Worley would charge the hospital $107 to purchase these supplies.

For years, Worley believed that the 7% markup covered its selling and administrative expenses and provided a reasonable profit. However, in the face of declining profits, Worley decided to implement an activity-based costing system to help improve its understanding of customer profitability. The company broke its selling and administrative expenses into five activities as shown:

Worley gathered the data below for two of the many hospitals that it serves—University and Memorial (each hospital purchased medical supplies that had cost Worley $31,000 to buy from manufacturers):

Required:

1.

Compute the total revenue that Worley would receive from University and Memorial.

2.

Compute the activity rate for each activity cost pool. (Round your answers to 2 decimal places.)

Business and Data Management

Module 3

Case Study One Instructions

Scenario:

You have been hired as a security analyst for Garbo Rheumatology Research Center. This lab is producing cutting edge treatments for rheumatology and similar autoimmune diseases. Despite being cutting edge, this research is not top secret. Funding is provided by government grants and sponsored by a major research university in the area.

While there is not an intense amount of security required, the data being researched does include medical and laboratory data taken from human and animal subjects. This information comes from a small, attached, on-site clinic and several small animal labs on university premise. Currently, accessibility to the facilities employ appropriate physical controls to ensure that only authorized individuals are permitted within the given facilities; via a combination of security badges and pin codes.

Laboratory

The labs are dedicated to research materials. Lab technicians utilize three shared desktops located in the rear of the labs to register their data. They use separate logins and are required to log out after they complete their work. Many of these technicians are Ph.D. candidates or post doctorate students who, also, utilize these computers to correspond with their advisors. Some of these advisors are the researchers who work on projects within the labs, while others are professors on the university’s main campus.

The actual data itself is stored in a server room, which also functions as the office of the systems administrator. Access to this room is available only to the systems administrator and the Primary investigator (PI) of the project. The medical doctors/researchers, who work on site, each have a private office where they review and analyze the research data. Each office is accessible only to the occupant and building maintenance. These researchers deal with patient medical records, student coursework, and research data produced by the lab.

Data held in the database -

• Medical patient profile
• Medical test results
• Demographic information of Individual patients
• Clinical visits organized by patient

Paperwork spread around the office -

• Physical version of patient’s medical chart
• Printouts of test results and biological samples from both human patients and animal subjects
• Student assignments with and without grades

Medical Clinic

The medical clinic is permanently staffed with receptionists, office staff, and nurses. The medical doctors/researchers rotate shifts seeing patients and do not have permanent office space in this area. Instead they share desks and computers, while the nurses and office staff have permanent space and computers assigned to them individually. There is a shared workspace at the front desk which is utilized for patient booking, patient sign-in, and processing patient payments. Patients pay for appointments with credit and debit cards.

Data found in the Clinic –

• Patient logs (sign-in sheets)
• Printouts of credit card transactions
• Receipts left by patients
• Medical records of patients being seen that day
• New patient profiles

Assignment:

Part of evaluating the security of an organization is understanding the environment which the business operates. It is important not to just identify the data being handled, but, also, to understand what laws and regulations protect the data. This information might force us to handle and protect the data in ways that we would not otherwise have planned to in order to comply with the regulations.

• Based on the above scenario, list in “table format” the laws and regulations that this organization should consider in terms of welfare and data privacy best practices? There are numerous laws and regulations available to research.
• Based on these standards (i.e., HIPAA), what best practices would you suggest for healthcare compliance requirements?

When WorldCom Inc.’s former chief executive Bernard Ebbers was found guilty of participating

In one of the largest U.S. accounting frauds ever, the ruling sent a message to corporate

Executives: Professing ignorance won’t necessarily save you.

Mr. Ebbers, who died Feb. 2 at age 78, was a former gym teacher who rose to head a

Telecommunications Company with a peak market value of about $180 billion. In the late 1990s

And early 2000s, WorldCom improperly boosted profit by booking operating expenses as capital

Spending, which can be deducted from earnings in small chunks over time.

During a trial in 2005, he pleaded not guilty to accounting fraud and said he didn’t know about

The misdeeds. The jury didn’t buy it. His 25-year prison sentence “put an exclamation point behind the old phrase ‘the buck stops here,’ ” said Patrick McGurn, special counsel at proxy advisor Institutional Shareholder Services. The dot-com bust and accounting scandals at WorldCom and Enron Corp. helped spur Congress to enact the Sarbanes-Oxley Act of 2002, whose provisions include requiring a public company’s chief executive and chief financial officer to certify that financial statements are accurate. The scandals also hastened a trend toward more independent corporate directors willing to challenge CEOs. Charles Elson, who heads a corporate-governance center at the University of Delaware, has this epitaph for the WorldCom fiasco: “As bad as it was, some good came out of it.” The regulatory changes didn’t mean corporate scandals would automatically land CEOs in prison. The aftermath of the 2008 financial crisis was notable for a lack of CEO scalps. Corporate leaders, wary of prison, may have become more cautious and less likely to leave paper or email trails, said Peter Henning, a law professor at Wayne State University, in Detroit. Mr. Ebbers, who built WorldCom through dozens of takeovers, was released from prison 13 years into his sentence in December because of deteriorating health. He followed an unconventional route to the CEO suite. The second of five children, Bernard John Ebbers was born Aug. 27, 1941, in Edmonton, Alberta, in Canada. His father worked as a traveling salesman and mechanic. The family moved to California in the late 1940s. Mr. Ebbers attended a boarding school on a Navajo reservation in New Mexico. As a young man he held odd jobs as a milk delivery man and a nightclub bouncer. Twice he gave up on college because of poor grades. He graduated from Mississippi College, where he played basketball, with a degree in education in 1967. Early in his career, Mr. Ebbers taught physical education and worked in a garment factory. He later began buying motels, starting with one in Columbia, Miss., where he lived in a two bedroom trailer in the parking lot. When AT&T’s “Ma Bell” system was broken up in the early 1980s, small rivals began reselling long-distance service. Mr. Ebbers and a handful of investors backed a company called Long Distance Discount Service, later renamed WorldCom. Dubbed the “Telecom Cowboy,” he earned a reputation as a hard-driving boss. He began to borrow money from the company in the late 1990s and used some of it to buy company stock. As the company expanded, Mr. Ebbers said he relied heavily on experts. “I’m not an engineer by training; I’m not an accountant by training,” he told the New York Times in 1998. “I’m the coach. I’m not the point guard who shoots the ball.” WorldCom began to show signs of stress in 2000 as its share price sank amid the dot-com meltdown. Mr. Ebbers was fired as CEO in April 2002. Soon afterward, an internal auditor spotted accounting irregularities. After his ouster, Mr. Ebbers appeared at his Mississippi church. At the end of the service, he walked to the front of the church and spoke to the congregation: “I just want you to know you aren’t going to church with a crook.” WorldCom’s former chief financial officer, Scott Sullivan, who engineered the fraud and worked closely with Mr. Ebbers, was sentenced to five years in prison after cooperating with prosecutors. He testified that Mr. Ebbers knew of the accounting methods used. Mr. Ebbers insisted he was blind-sided by the fraud. “I know what I don’t know,” he testified in a federal court. “I don’t, to this day, know technology. I don’t know finance and accounting.” As a judge delivered the sentence in 2005, Mr. Ebbers hung his head and cried while hugging his wife, Kristie Ebbers, who filed for divorce in 2008. He drove himself to prison in a Mercedes the following year and spent part of his sentence as inmate No. 56022-054 in a low-security prison in Louisiana. He was later transferred to FMC Fort Worth, a federal prison hospital in Texas. Paul Watson, a Mississippi resident and former WorldCom investor, lost $135,000 when the company collapsed, and supports a relative who lost $2.2 million. Still, he said, he feels little anger toward Mr. Ebbers and thinks “others have done far worse and been punished less.”

1. Why do you think, Charles Elson, from University of Delaware, said: “As bad as it was, some good came out of it.”?
2. Do you believe Mr. Ebbers was at fault of what happened with Worldcom despite he claimed in court that”…. I don’t know finance and accounting.” Why?
3. Why was Bernie Ebbers called the Telecom Cowboy?
4. Did the agency problem take a role in the Worldcom fiasco? Explain why yes or no? (note: there is not a clear answer here, so whatever you answer will be ok as long as you can explain it)

EZ Clean-Up Inc. (EZ Clean-Up or the “Company”) provides various set-up, tear-down, and clean-up services to party-planning businesses as well as various third-party customers.

The Company entered into a contract with The Function Junction LLC to be the sole provider of its services for all its events for a period of three years. The Function Junction holds weekly events, with EZ Clean-Up providing its services for every event. After the initial three-year period, the contract is renewable in one-year increments. The average customer relationship period typically lasts five years (the initial three-year term plus two one-year renewals). The Company accounts for the arrangement as a contract with a customer within the scope of ASC 606.

As an incentive to execute new customer contracts, the Company offers its sales representative a one-time $5,000 commission, which is earned and payable to the sales representative as soon as the contract is executed with the customer. No additional commission is paid to the sales representative upon renewal of the contract by the customer.

Before winning the contract, the sales representative incurred $500 in travel costs to travel to The Function Junction’s headquarters to perform a demonstration.

EZ Clean-Up incurred approximately $2,000 in external legal costs to draft the contract executed between the Company and The Function Junction.

Required:

1. Under US GAAP, how should EZ Clean-Up treat incremental costs of obtaining a contract? Please answer the same question under IFRS/IAS.

2. According to US GAAP, which costs, in this case, are incremental costs of obtaining the contract, and therefore are required to be capitalized?

3. According to US GAAP, how should EZ Clean-Up determine the appropriate amortization method, and over what period should the Company amortize any capitalized costs?

4. According to US GAAP, what disclosures should EZ Clean-Up provide in its financial statements?

EZ Clean-Up Inc. (EZ Clean-Up or the “Company”) provides various set-up, tear-down, and clean-up services to party-planning businesses as well as various third-party customers.

The Company entered into a contract with The Function Junction LLC to be the sole provider of its services for all its events for a period of three years. The Function Junction holds weekly events, with EZ Clean-Up providing its services for every event. After the initial three-year period, the contract is renewable in one-year increments. The average customer relationship period typically lasts five years (the initial three-year term plus two one-year renewals). The Company accounts for the arrangement as a contract with a customer within the scope of ASC 606.

As an incentive to execute new customer contracts, the Company offers its sales representative a one-time $5,000 commission, which is earned and payable to the sales representative as soon as the contract is executed with the customer. No additional commission is paid to the sales representative upon renewal of the contract by the customer.

Before winning the contract, the sales representative incurred $500 in travel costs to travel to The Function Junction’s headquarters to perform a demonstration.

EZ Clean-Up incurred approximately $2,000 in external legal costs to draft the contract executed between the Company and The Function Junction.

Required:

1. Under US GAAP, how should EZ Clean-Up treat incremental costs of obtaining a contract? Please answer the same question under IFRS/IAS.

2. According to US GAAP, which costs in this case are incremental costs of obtaining the contract, and therefore are required to be capitalized?

3. According to US GAAP, how should EZ Clean-Up determine the appropriate amortization method, and over what period should the Company amortize any capitalized costs?

4. According to US GAAP, what disclosures should EZ Clean-Up provide in its financial statements?