Final Corporate Compliance Project
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RUNNING HEAD: Corporate Compliance Report
Corporate Compliance Report: Tyco International
Karen M. Baker
University of Phoenix
MBA/560 Enterprise Risk
Erikka Hise
September 28, 2009
Corporate Compliance Report
Today’s publicly-owned businesses have more rules and regulations than ever to follow. Terms including SOX, corporate governance, and enterprise risk management should be part of a company’s regular vocabulary. When employed correctly, these processes can assist the company with managing internal controls and assessing risks to remain viable among competitors and their respective markets.
This paper outlines some research of the Committee of Sponsoring Organizations of the Treadway Commission (COSO), a voluntary private-section organization, and its guidance to executives in critical areas of the business. The paper provides a brief history of Tyco International and issues the organization faced, followed by some resources Tyco can employ to manage risks. The paper continues by differentiating between types of controls, and finally, recommends a solution melding risk management with governance.
The Company
Company Background
Tyco International started back in 1960 mainly as a research laboratory, and incorporated as Tyco Laboratories in 1962 (Tyco, n.d.), focusing on high-tech materials and energy products. In 1964, the company went public. Shortly thereafter, Tyco began a series of acquisitions to broaden their scope and distribution network. Tyco’s focus diverted to the manufacturing of industrial products (Tyco, n.d.).
Former CEO Dennis Kozlowski formed a tight inner circle with his executive staff that helped themselves to company money in the form of loans for personal use. There was no presidential role and internal audits remained sequestered. The Securities and Exchange Commission (SEC) was investigating the company’s financial statements and accounting practices (Economist, 2003). Tyco’s acquisitions did more than expand their...
Corporate Compliance Report: Tyco International
Karen M. Baker
University of Phoenix
MBA/560 Enterprise Risk
Erikka Hise
September 28, 2009
Corporate Compliance Report
Today’s publicly-owned businesses have more rules and regulations than ever to follow. Terms including SOX, corporate governance, and enterprise risk management should be part of a company’s regular vocabulary. When employed correctly, these processes can assist the company with managing internal controls and assessing risks to remain viable among competitors and their respective markets.
This paper outlines some research of the Committee of Sponsoring Organizations of the Treadway Commission (COSO), a voluntary private-section organization, and its guidance to executives in critical areas of the business. The paper provides a brief history of Tyco International and issues the organization faced, followed by some resources Tyco can employ to manage risks. The paper continues by differentiating between types of controls, and finally, recommends a solution melding risk management with governance.
The Company
Company Background
Tyco International started back in 1960 mainly as a research laboratory, and incorporated as Tyco Laboratories in 1962 (Tyco, n.d.), focusing on high-tech materials and energy products. In 1964, the company went public. Shortly thereafter, Tyco began a series of acquisitions to broaden their scope and distribution network. Tyco’s focus diverted to the manufacturing of industrial products (Tyco, n.d.).
Former CEO Dennis Kozlowski formed a tight inner circle with his executive staff that helped themselves to company money in the form of loans for personal use. There was no presidential role and internal audits remained sequestered. The Securities and Exchange Commission (SEC) was investigating the company’s financial statements and accounting practices (Economist, 2003). Tyco’s acquisitions did more than expand their...