Enron Case Stydy Essay

1231 WordsSep 30, 20125 Pages
Enron was a corporation founded in 1985; named Enron after merging two companies together Internorth Incorporated and Houston Natural Gas. Enron became one of the world’s leading electricity and Natural Gas Company founded in Houston, TX. Enron’s Bankruptcy case was one of the biggest case in the United States history. Enron is a corporation, where ethics and corporation values have been abolished. The CEO and management abolished not only corporate culture, but many other rules and norms of a business. This is a case of how multimillion dollar corporation collapsed in two weeks. It took them sixteen years to build on of the strongest corporation in a wall street, and took them two weeks to go bankruptcy. Wall Street’s analysts could not understand how Enron always did better than the competitors. But it was Wall Street analysts also, who kept rising the stock prices of Enron. On August, 2001, Enron was in the strongest shape in its history. On December 2nd, 2001, Enron filed for bankruptcy. How corporation like this big could collapse dramatically? What was the reason of Enron’s collapse and who had blame? The CEO Jeff Skilling as well as Kenneth Lay, CFO Anrew Fastow for setting up partnership, Arthur Anderson for lax accounting, the board of directors and Enron’s management for hiding the losses. It was board of directors that played an active role of the corporation’s failure. It was Enron’s highest paid board of directors who violated the corporation’s code of ethics and allow the creation of partnership of Fastow and Enron. Attendance also was the great issue; almost half of its board members were outside of the United States. Missing the board meetings and not contributing their share of vote let the company to criticism. It was Fastows Corporation that appropriated 30 million dollars. Being aware of off balance sheet transactions that occurred between

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