Ethics in The Modern Business World A case study on Leisure Net Essay Example For Students

Ethics in The Modern Business World: A case study on Leisure Net Essay LeisureInternet In October 2000 the company Leisure Net, life style and wellness Fitness Company, was provisionally liquidated, holding been listed merely five old ages earlier on the JSE. Today Leisure Net has passed its ill-famed dirt and is being presently run by managers ; Mike Hill and David Monkhous. Peter Gardener and Rodney Mitchell, at the clip of 2000 moving executive managers of Leisure Net, were convicted in 2012 on charges of conflicting s234 ( 1 ) of the companies act61 of 1973, they served merely 19 months of a 7 twelvemonth sentence. They were convicted of this fraud through the usage of company bank histories and inflating of net incomes. The Leisure Net dirt has had far making consequence on South African jurisprudence and concern. It is asked whether the prostration of Leisure Net was the consequence of Peter Gardener and Rodney Mitchel were they entirely to fault, or the inability of the board of managers to place and halt these two work forces. Many criticize the events environing whistle blower Wendy Addison, saying it was non her exclusive duty to expose the corruptness of these two persons. The South African concern requires all concerns act and follow the highest of codification of behaviors and moralss to advance itself to future investors. Cases like Leisure Net harm South African concern image, as their actions could hold possible scared off possible investors. This survey will expose the deceitful activity and impractical internal controls of Leisure Internet. The Problems It is usual for wellness nines to roll up money by agencies of debit orders. So it is easy to duplicate the debit run which LeisureNet did in December ; debiting one time at the beginning of the month and one time at the terminal of the month. This so showed increased gross for the period. This increased gross would be deceitful. Furthermore leisureNets fiscal statements for 1999 besides stated that they have been approved and that their histories Deloitte and Touche had approved them. This was non true. The two work forces used offshore histories to wash Dalmore money ; a company acquired by Leisure Net and in which the executive managers Peter Gardener and Rodney Mitchell held 20 % of the portions. Using concern histories they were able to avoid revenue enhancement and hide assets. However the existent ruin of Leisure Net is owed to Peter Gardener and Rodney Mitchell clever method of blow uping net income by taking advantage of the debit order system which all electronic left no statements doing its easy to duplicate the subscription tally. Internal controls Internal controls are defined as holding five constituents: 1. Control Environment-sets the tone for the organisation, act uponing the control consciousness of its people. It is the foundation for all other constituents of internal control. 2. Risk Assessment-the designation and analysis of relevant hazards to the accomplishment of aims, organizing a footing for how the hazards should be managed 3. Information and Communication-systems or processes that support the designation, gaining control, and exchange of information in a signifier and clip frame that enables people to transport out their duties 4. Control Activities-the policies and processs that help guarantee direction directives are carried out. 5. Monitoring-processes used to measure the quality of internal control public presentation over clip. Internal controls are implemented in: Delegated authorization Bank Cash Fixed assets Vehicles Stockss Payroll We see here a failure in three major countries of internal control ; delegated authorization, bank and hard currency. Delegated Authority: The Board of Trustees delegates authorization through the Chief Executive for the daily running of the administration. In a big and busy administration it is non practical to anticipate one individual to do all the determinations and empower all minutess. The Chief Executive will, hence, farther delegate authorization to members of the staff squad to alleviate the burden and to guarantee smooth operation during absences of cardinal staff. The Roswell Incident Persuasive Essayhypertext transfer protocol: //www.nomuraholdings.com/investor/cg/intcon.html hypertext transfer protocol: //www.mango.org.uk/guide/icexamples hypertext transfer protocol: //www.iol.co.za/news/crime-courts/leisurenet-whistleblower-speaks-out-1.1460904 hypertext transfer protocol: //www.leisure-net.org hypertext transfer protocol: //www.aabschools.com/case_studies/424.html Ethical CHALLENGES IN SOUTH AFRICAN BUSINESSES The existent job with the subject of concern moralss is non merely the cost of being caught or punished but the impact on the perceptual experience of the company. Awareness is increasing. But research suggests that many concerns have a conformity attack to pull offing moralss – it’s about clicking boxes – it does non interpret into existent desired behaviour.† The ethical jobs I am traveling to talk about are Nepotism, Corruption, Sexual Harrasment and Illegal Strikes. Nepotism Nepotism by and large means supplying workplace chances to employees based on personal relationships instead thanon their makings for the place. This will cut down the overall productiveness of the company. This deficiency of equity can besides do a concern to lose its best employees as their bitterness will do so to seek to travel to more ethical concerns. In add-on, it becomes a job for directors who are non able to give just intervention to their subsidiaries because they are connected to person of authorization in the company. It besides gives these employees a sense of entitlement and that the effects do non use to them. Corruptness Corruptness is the maltreatment of entrusted power for private addition. It hurts everyone who depends on the unity of people in a place of authorization. Corrupt activity affects development, it contributes to less local and foreign direct investing. Sexual Harrasment Sexual torment is identified as unwanted behavior of a sexual nature.Sexual torment in the workplace is inexcusable. It is the employer ‘s duty to guarantee that policies and processs are followed in order to halt sexual torment in the workplace. Employees need to be able to place Acts of the Apostless of sexual torment so that the necessary action may be taken to extinguish this. Employers should develop and implement policies and processs that will take to the creative activity of workplaces that are free of these patterns Illegal Strikes Management must walk the talk if there is to be a alteration in concern moralss