Sunset Medical

26 Pages Posted: 22 Aug 2010

See all articles by Scott A. Wandler

Scott A. Wandler

University of New Orleans

Kevin Watson

Iowa State University

Date Written: August 20, 2010


Sunset Medical is based on a real situation occurring at an Orthopedic Medical practice in Colorado. While attending a trade show Dr. Jones, the managing partner at Sunset Medical, was approached by a medical consulting firm, Physicians Medical Inc. (PMI), to provide the practice billing and administrative services. Dr. Jones decided to hire PMI and signed a contract with February of 2006. Based on the interim financial statements that were released in June of 2006, Dr. Jones gave PMI control of the overall day to day operations of the practice. PMI immediately relieved the office manager of her duties and took over all operations of the practice. In early 2007, the 2006 financial statements were released and were not as impressive as the mid-year results. Dr. Jones is now worried that the increased power given to PMI may have been a mistake and has asked you to give a full assessment of the situation.

The case is suitable for an introductory Financial or Managerial Accounting class at the M.B.A. level once the students have a working knowledge of the financial statements. The students must critically evaluate contract language and financial statements to examine ethical dilemmas that face businesses.

Keywords: Case, Ethics, Contract Language, Forensic Accounting, Comparative Financial Statements, Critical Thinking, Statement of Cash Flows, Financial Accounting, Managerial Accounting

JEL Classification: M41

Suggested Citation

Wandler, Scott A. and Watson, Kevin, Sunset Medical (August 20, 2010). AAA 2011 Management Accounting Section (MAS) Meeting Paper. Available at SSRN: or

Scott A. Wandler (Contact Author)

University of New Orleans ( email )

New Orleans, LA
United States

Kevin Watson

Iowa State University ( email )

613 Wallace Road
Ames, IA 50011-2063
United States

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