Aaron Beam

Rationalizing our action

 using ‘aggressive accounting’ in company’s financial report.
 do it for good everyone in the company. If not, they be hurt.
 just trying to accomplish what he was being told.

Displacement of responsibility
 pointing a finger to his employer (Scrushy)
 just only follow Scruchy's instructions
 forced to falsify data in company's financial report

What went wrong, he said, was that he and Scrushy were greedy. 
Scrushy, Beam said, was especially greedy, going about saying he wanted to be a billionaire and the
richest man in Alabama.
What HealthSouth did was understate its accounts receivable reserves and overstate its revenues.
In addition to the revenue recognition irregularities, misclassification of expenses was a common practice
at HealthSouth.
That’s why I believe every one of you should live your life with a commitment to ethical conduct in
everything that you do, and expect the very same from everyone who works for you.
Aaron Beam knew that his actions were indeed wrong and he could no longer carry on, therefore, he
retired and paid a price for his wrong actions.
Aaron Beam was morally responsible for engaging in “aggressive accounting” methods he used because
from the very beginning when Scrushy told Beam to fake their financial reports, Beam knew that it was
wrong, yet he continued to do it. Beam later on went against his morals and continued to commit fraud
until he finally retired.
Aaron Beam’s responsibility was not mitigated in anyway. Even though Beam was “convinced” by
Scrushy and his own thoughts, he was still responsible for his own actions of “aggressive accounting”.
Aaron Beam was not morally responsible for changing the clinic reports to increase the company’s
earnings. His responsibility was mitigated due to the fact that he as well as others was included in
reporting false records.
The people whom were cooperated in his actions are morally responsible for their actions. Their
responsibilities were also mitigated because they all knew that they were committing fraudulent and
continued to do so even after Beam has retired. Richard Scrushy was morally responsible for accounting
fraud because even though he did not work under the financial department, he knew what the
consequences in the frauds would be. He convinced Beam to so anyways.

He neglected all the ethics and morals by just involving Beam in fraudulent activities and every quarter
when the company went short of meeting Wall Street analysts’ expectation, they inflated the revenues.
His ethical conduct went rogue when a company was negotiating a new credit agreement with a
syndicate of 32 lenders from around the world totalling of $1.25 billion, and he pressurised Beam that if
the banks got wind of shortfall it would cripple the company they had worked so hard to build.

to show the business managers should single-mindedly purse the interests of their firms and should
ignore the ethical consideration.

He might have used this argument to defend his action because he was told by his employer to do all the
things in order keep the financials high. Beam did what he was told to advance his employer’s interest.
He not only violated the accounting principles but also involved other people from different
departments by making their life in jeopardy

The loyal agent argument is not a valid argument because it doesn’t cater the moral and ethical
standards. It only provides benefit to the employer by advancing his interest rather than the company’s
interest as a whole. In the case Aaron never stood up to his employer, Scrushy, and stated that Scrushy
made himself and others fearful of contradicting him.

n. He is aware of right and wrong actions but nonetheless has a stronger desire to please his employer.
Perhaps he had more fear than trust in Scrushy, nonetheless he wanted to fulfil the role of living up to
his expectations

There are many lessons that could be drawn from the story at HealthSouth. Most of the lessons are
obvious – so obvious that one wonders how they all could have been missed.

In the HealthSouth case, we observe real life examples of people who were "just doing their job" but at
some point crossed the line from law-abiding citizens to law-breaking villains. Seemingly small
compromises in ethics and morality led to larger compromise and, ultimately, a full-scale commitment
to fraud

There are many lessons that could be drawn from Aaron Beam and HealthSouth Fraud. But,

before regretting their unethical actions, they can somehow avert this largest corporate fraud in the

history of United States in many possible and endless ways - that anyone could wonder how and why

they all could have been neglected and missed.

Perhaps, Scrushy’s and Beam’s greediness to become the richest man in Alabama placed them

to a shame of white-collar criminals, that could possibly be prevented if Aaron Beam knows how to

stood up to his employer and does not do what was told to him just to please Scrushy’s interest.

However, despite of Beam’s awareness of his right and wrong action, not to mention his morally
irresponsible “aggressive accounting” methods, he has a stronger desire to fulfill the role of living up to

his employer’s expectations. These scenarios of people paying the price for their unlawful act that

transitioned them from law-abiding citizens to law-breaking villains, is just a depiction of how ethical

conduct in any organization must be uphold.

On the other hand, another possible solution for this case is to establish appropriate safeguards

towards their accounting records and control over assets. It is inevitable in the life of the business, that

there will always be peak season and slack season, in spite of that, one should live their life with a

commitment to ethical conduct to everything that they do, and expect that your co-workers will do the

same to you.

That’s why I believe every one of you should live your life with a commitment to ethical conduct in
everything that you do, and expect the very same from everyone who works for you.”