Enron: Questionable Accounting Leads to Collapse

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Case Study Enron: Questionable Accounting Leads To Collapse In this case study I will be discussing Enron, a company that was once top ranked among Fortune 500 companies. In 1985, a merger between two major gas pipeline companies created the Enron Corporation. The corporation was lead by Chairman Ken Lay, CEO Jeffrey Skilling, and CFO Andrew Fastow and under their reign, Enron’s revenues grew by the billions. A decade later, they had achieved one of the largest and most complicated bankruptcies in history. This is easy to do when you are creating money out of thin air. The motto seemed to be that if the numbers looked good on paper the money would be there. They were wrong to say the least. From fraud, money laundering, conspiracy, wire fraud, obstruction of justice, insider trading, and felony tax crime, Enron was built on a series of lies, many people lost a lot of money, and Enron was no more. Their arrogance cost them everything. They had help from lawyers, bankers, and Arthur Anderson was ensuring the accuracy of Enron’s financial statements and internal bookkeeping. The corporate culture at Enron, in my opinion, did contribute to Enron’s bankruptcy. The tone at Enron was arrogance, and they truly believed that competitors did not stand a chance against them. Employees were rated every six months and if you were on the bottom twenty percent, you were forced out. This helps create an atmosphere where everyone is out to do better than the next. Enron’s executives were more concerned about their own pockets rather than the interest of stakeholders. Ken Lay originally wanted it to be a highly moral and ethical culture it was never achieved. There was never anything put into action to make this type of culture possible. I do believe that Enron’s bankers, auditors, and attorneys helped them to achieve their lies. There
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