Essay on Enron Questionable Accounting Leads to Collapse

ENRON: QUESTIONABLE ACCOUNTING LEADS TO COLLAPSE CRYSTAL RUFF GLOBE UNIVERSITY ABSTRACT This paper summarizes the article listed in reference that reported on the demise of Enron and the contributing factors that led to the financial downfall of a great company. The roles of the corporate culture, Enron’s financial staff, and even the chief financial officer are all to blame for the events that lead to the finality of the company that resulted in bankruptcy. While Enron boasted about being â€Å"The World’s Leading Company†, it was anything but that. The corporate culture of a company is supposed to describe how the stakeholders and employees, think, feel, and act. If Enron’s financial record is example of that, then the†¦show more content†¦. (L. Ferrell, O.C. Ferrell, amp; Fraedrich, 2011). Enron’s lawyers, Vinson amp; Elkin, were well aware of the scandal that was about to rock the company. In fact, claims allege that Vinson amp; Elkin helped to create the special purpose partnerships that Enron so needed to cover up losses. . (L. Ferrell, O.C. Ferrell, amp; Fraedrich, 2011). Even though fault was not admitted, the law firm paid out millions to settle claims of any wrongdoing. Merrill Lynch went under scrutiny when it allegedly made a deal with Enron on the procurement of barges, which were falsely reported in earnings. Merrill Lynch was also involved in a situation where a research analyst had fi ndings that Enron was not happy with, and with a push from Merrill Lynch, the analyst rewrote his findings so they were advantageous to Enron. . (L. Ferrell, O.C. Ferrell, amp; Fraedrich, 2011). As Enron’s auditor, Arthur Anderson was responsible for the financial statements and bookkeeping for the company. However, he was found guilty of obstructing justice for destroying auditing documents. . (L. Ferrell, O.C. Ferrell, amp; Fraedrich, 2011). As the CFO of Enron, Andrew Fastow defrauded the company out of $30 million by using partnerships created to show Enron as being debt free, when in fact it owed approximately $1 billion. Fastow took money that should have gone to other entities and when he was found guilty, he surrendered almost $30 million in cash and property. . (L.Show MoreRelatedEnron: Questionable Accounting Leads to Collapse2056 Words   |  9 PagesEnron: Questionable Accounting Leads to Collapse The Enron Corporation was established by integrating two major gas pipelines in 1985. The Company provided products and services related to natural gas, electricity, and communications and it was one of the world’s leading organizations at these sectors with claimed revenues of nearly $101 billion in 2000. Throughout the 1990s, Chair Ken Lay, chief executive officer Jeffrey Skilling and chief financial official officer Andrew Fastow transformedRead MoreEssay on Enron: Questionable Accounting Leads to Collapse784 Words   |  4 PagesEnron: Questionable Accounting Leads to Collapse In the case of Enron, it comes down to pure greed and a lack of accountability. From the top, there was illegal activity with Ken Lay, Jeffrey Skilling, and Andrew Fastow who raided the company as though it was their own personal bank. On top of that, the culture of the rest of the company was to make as much money as they could and employees were rewarded by the amount of profit they could make without questioning the ethical means to do so. Read MoreCase: 9 Enron928 Words   |  4 PagesCase 9: Enron; Questionable Accounting Leads to Collapse Bruce Smith Minnesota School of Business BS430 Business Ethics MR. Morris November 25, 2012 1. 2. 1. How did the corporate culture of Enron contribute to its bankruptcy? 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