University of PhoenixThis paper will evaluate the planning function of the Tyco Company and analyze the impact that legal issues, ethics, and corporate social responsibilities have on management planning. The year 2000 was a year marked by scandal over the accounting practices of some of the biggest corporations in the world, including Tyco International Incorporated. Tyco's top executives were indicted and convicted of fraud charges stemming from both improper accounting practices as well as improper personal use of company funds. The planning strategy of these executives seems to have been more focused on personal gain than on the best interests of the company and its shareholders. They ignored their responsibilities to the laws governing corporate management and to their investors and employees. Dennis Kozlowski, the chief executive officer, alone plundered the company of over 400 million dollars. Using company funds, he threw a toga party for his wife's birthday that cost two million dollars.
Michael Oxley , U.S. Senator from Maryland.
Before the signing ceremony of the Sarbanes-Oxley ...
Cover scan of the final issue of Tyco World, May 2...He bought millions of dollars worth of art to decorate his home. He spent six thousand dollars of company money on a shower curtain and 15 thousand dollars on an umbrella stand shaped like a poodle. Unlike most of the companies targeted by those investigations, Tyco survived the scandals and is still in business today because it changed the way that it operates. Three of the factors that influence management planning today are their ability to obtain materials and components for manufacturing, the rate of attrition for their home security products and services and the ongoing litigation and investigations.
Remembering the indictments and convictions of former CEO Dennis Kozlowski and CFO Mark Swartz, Tyco's current management must always be very aware of their responsibility to obey anti-fraud legislation and the rules of the Securities and Exchange Commission. Because of the widespread accounting practices that came...