Fraud paper - and finances with their shareholders and...

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Michael Reber 4/29/11 Fraud Paper Enron Scandal Enron was an American energy company that was created in 1985 by Kenneth Lay. Enron started off like most companies and had uprising success, however the board of Enron went ahead with bad ethical decisions that led to the end of the company. In 1985 Kenneth Lay combined the companies Houston Natural Gas and InterNorth and formed Enron. It became the number one seller of natural gas in North America by just 1992. Once Enron had grown to considerable size, Jeffrey Skilling was hired and took on the task of building an executive team to run the company. This team used different types of Accounting fraud and poor financial reporting to cover up billions in debt that came from failed projects and deals that went bad. According to the Wikipedia article on this scandal, this happened because their nontransparent financial statements did not clearly depict its operations
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Unformatted text preview: and finances with their shareholders and analysts. I think that if Enron had developed any principles of Internal Control over their financial reporting, then they were not monitored very effectively, if at all after a given amount of time. The internal control that they failed on was to keep the accounting records correct and current. The accountants should have recognized what was going on and reported what was happening and may have known but told to hush up. In the end the company lost $63.4 billion in Assets including: gas pipelines and an assortment of different plants. This was the biggest bankruptcy in American history up until WorldCom went bankrupt the following year. Bibliography 1. 31, December. "Enron Scandal." Wikipedia, the Free Encyclopedia . Web. 29 Apr. 2011. <http://en.wikipedia.org/wiki/Enron_scandal>....
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Fraud paper - and finances with their shareholders and...

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