BUS 431Exam2 - Exam#2 1 A The culture of Enron was that of...

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Exam #2 1) A) The culture of Enron was that of a new era of corporate culture and newer thinking. They never wanted to be satisfied in their business so they would continually try and evolve to be more and more profitable. Trying to find new ideas in any way to increase the company’s profits was a popular mindset at Enron. The CEO even stated once that people are only motivated by making money, and Enron’s culture embraced this philosophy fully. Stock information was readily available to all, even in their elevators. The people who worked there saw their profits increase as the company’s stocks rose as well because of the earnable stock that was available to employees of Enron. The company would take enormous risks because they felt that you can only really make money when you take risks in business. B) Jeff Skilling introduced the mark-to-market accounting system. This method would put future profits on the records on the day the deal was signed, no matter what the actual amount coming in at that time was. He developed this style also so that his ideas and moves will be credited to the person who came up with the idea and not whoever was in charge down the road when the idea may be flourishing more. This subjective style of recording was leaving their information open to any manipulation that they would want or need to record and ultimately was used in the fraud that would eventually occur throughout Enron. C) The “whistleblower” was another name for Sherron Watkins, who was one of
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the first people to identify the accounting fraud occurring at Enron. She was a former employee of their auditing firm Arthur Andersen before joining Enron in the mid ‘90s. Her role in the revealing of the fraudulent information became
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BUS 431Exam2 - Exam#2 1 A The culture of Enron was that of...

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