Financial Statement Fraud.Enron.AICPA

They assigned a young consultant named jeffrey

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Unformatted text preview: ka pipeline company. company. Enron incurred massive debt and no longer had Enron exclusive rights to its pipelines. exclusive Needed new and innovative business strategy Kenneth Lay, CEO, hired McKinsey & Company to assist Kenneth in developing business strategy. They assigned a young consultant named Jeffrey Skilling. consultant His background was in banking and asset and liability His management. management. His recommendation: that Enron create a “Gas Bank”— to buy and sell gas © 2003, 2005 by the AICPA Enron’s History (cont’d) Enron’s Created Energy derivative Lay created a new division in 1990 called Enron Finance Lay Corp. and hired Skilling to run it Corp. Enron soon had more contracts than any of its competitors Enron and, with market dominance, could predict future prices with great accuracy, thereby guaranteeing superior profits. with Skilling hired the “best and brightest” traders and rewarded Skilling them handsomely—the reward system was eat what you them kill kill Fastow was a Kellogg MBA hired by Skilling in 1990— Became CFO in 1998 Started Enron Online Trading in late 90s Created P...
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This document was uploaded on 03/29/2014.

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