Case Study 1

Green Grass is a small, family-operated company whose coreservice is in horticultural care and lawn care for customers in thelocal city. The owner of the company is the father of the family.He has used the company to cover the costs of his children’scollege education. At the same time, he has been able to give hischildren some work experience and an opportunity to earn their ownmoney to pay for school. The company has grown steadily over thelast few years, and the owner has hired many employees outside ofthe family to be able to keep up with the demand of the increasingnumber of customers. The company is run from a small officebuilding, and there is only one employee performing the managerialoperations in the company office. The father had usually been incharge of this aspect of the company, but now leaves theresponsibility to his trusted friend, who has experience inaccounting and information systems. This employee is in charge ofscheduling the routes of all the employees and is responsible forpayments, receipts, and balancing the books.

The company performs two major operations. First, it provideslawn care using insecticides, fertilizer, and weed killers. Eightemployees are responsible for this activity. They each drive atruck and are responsible for collecting money from the customersthey serve. They are also responsible for loading and mixingchemicals in the tanks they use during the day. The second part ofthe operation is the lawn mowing care. Usually, a four-man crew isresponsible for all the machines they use, and they are responsiblefor taking care of the lawns on their daily schedule. This is wherethe owner has hired his children to work, and the whole team isusually made up of younger workers than the team that works withthe chemicals.

Over the years, Green Grass has experienced small growth andsuccess. Profits have increased steadily as the company has pickedup new clients. However, the owner noticed that last year’saccounts were different. The revenues increased a marginal amount,while the expenses for the company increased more than they shouldhave. The owner has noticed that his interactions with his friendin the office have been fewer and not quite so friendly. Also, hisemployees have been finishing their routes later in the day thanthey had in previous years.

Questions

1. Discuss the opportunities, pressure, rationalization that canbe identify in the case.

2. What steps should be taken to make sure fraud does not occur,and what are the costs associated with these steps?