Diabetes in dogs is not as common as it is in cats, but it is by no means rare either. Yes, they should have checked the blood sugar level so that they had a firm diagnosis for diabetes and a starting point to compare to as they adjust the insulin dose. Glucose in the urine usually means the dog is diabetic, but not always and can be caused by other diseases or toxins. However, the dose of insulin that they start on is generally not the "correct" dose. What most vets do is start on a low dose of insulin, because the amount of insulin required is different for each individual and has absolutely nothing to do with weight or breed. Unlike most other medications, when even if there is a wide range of theraputic doses that dose is still based on size (for example a 50lb dog will need somewhere between 5mg and 15mg, a 100lb dog will need between 10mg and 30mg, etc), insulin dose is based soley on how that patient is responding. A 50lb dog may only need 20U and a 20lb dog may need 40U. You start on a low dose and check the blood glucose each week and increase the amount of insulin each week until the dog's symptoms are under control and the glucose is within the target range. It can be extremely frustrating because it can take weeks or even months to get the diabetes under control and while insulin and routine glucose/fructosamine checks to make sure that the diabetes is controlled are not expensive, it can get expensive to take the dog in for weekly glucose checks for weeks on end with no end in sight while the owner is waiting for the diabetes to come under control.
If your boss has internet access, there are tons of resources for pet owners of diabetic dogs.