Enron Scandal: A Security Professional's. Words: Length: 10 Pages Topic: Business Paper #: Later in the year, this same task force, including Cheney, recommended Enron as a company that was upstanding and endorses its many proposals Enron Scandal Essay Words | 3 Pages. The reason of Enron Corporation downfall for audit failure is conflict of interest and accounting fraud. This is because it has been suggested that conflicts of interest and a lack of independent oversight of management by Enron's board contributed to the firm's collapse. Some have suggested that Enron's Enron scandal Essays. Enron Scandal Analysis Words | 6 Pages. Introduction - Historic Enron Financial Scandal In Houston Natural Gas and InterNorth merged to become Enron which started specializing in natural gas production. It moved from a $10 billion company in to a $ billion in ten years. Kenneth Lay is the founder
Example Of The Enron Essays | WOW Essays
Paper Types. This Research Paper was written by one of our professional writers. You are free to use it as an inspiration or a source for your own work. The ENRON was the 7 th largest U. Company in the year that was filed for bankruptcy leaving enron scandal essay investors and retirees with worthless stock. The company was established in by merger based in Houston dealing with natural gas pipeline. By the year the company had risen to be ranked the 7 th largest U. Company of natural gas and electricity. The ENRON Company was greatly concerned with energy brokering, electronic energy trading, optional trading and global commodity by then.
Corporate governance practices uniron were associated with the financial statements that were not accountable and transparent as much as the legal requirement is concerned. The practices of corporate governance were also marked with complex and dubious models of business operations on top of the unethical practices that resulted to the adoption to accounting limitations in an attempt to misrepresenting the earnings together with the modification of the balance sheet enron scandal essay at portraying performance depictions in a favorable way.
The Enron scandal is attributed to the steady accumulation of the values, enron scandal essay, habits as well as actions that came out control. The board of directors of the Enron Company looked at the loopholes of the already established regulation in their line of buying and selling natural gas and chooses to use that advantage in benefiting themselves, the fact that was illegal. It was geared to getting a steady income, inflating the assets values with off booking liabilities. Most of the problems were perpetuated by the executives of the company. The compensation structure that was set in Enron together with the system of performance management was designed in a manner that could attract and retain the employees who were quite resourceful to the company.
However the system setup also played a significant role in the dysfunctioning of the corporate culture in the organization. The setup had been infatuated with a short term focus of earnings for the purpose of maximizing on bonuses. The employees perceived at deals of high start volume while they disregarded the cash flow and profits quality for the purpose of coming at higher rating in the course of performance overview. Further to this there was an immediate recording of accounting results so that to be at par with the stock prices of the company. The intention of this practice was to cover the deal makers together with the executives who were given significantly huge cash bonuses in addition to stock options Bryce, The corporation had employed thousands of people who had affiliations right up to and including the White House itself.
The financials chaos caused by the Enron scandal destroyed the life of many people and its reputation lefts its wake, questions everywhere concerning how the catastrophe happened, and who were behind it. The scandal was discovered on October 22,by the Securities and Exchange Commission when a huge loss had been announced by the Enron expressing a major public sign of trouble. Enron Company was found to be using complex dubious schemes for energy trading. The company would use routing scheme that enabled them to buy enron scandal essay sell energy in net terms, enron scandal essay. This was done between and when the scandal was revealed. The company was also found to be using complex and dubious accounting schemes that would enable it to reduce the tax payments by a great margin and inflate its income and get abnormal profits.
This scheme also enabled Enron to inflate its stock price and credit rating into the U. and it was able to hide the losses in off-balance-sheet subsidiaries. The off-balance-sheet scheme channeled a lot of money to their personal accounts, friends and families and fraudulently gave a misleading financial report to the public. Internal controls and risk management in any organization are important features in any organization and they contribute significantly to the corporate governance of the institution. They also enhance the structure of internal control, the analysis of risk management and the process of financial reporting. The contributions of the editors in most organizations are to provide the services of consultancy together with assurance to the managers such that their companies are able to comply with the existing regulations.
The resources of internal audit have in the past undergone expansion for the purpose of giving satisfaction to the high level of demand for the services in an attempt of assisting in the process of executive certifications with regard to internal controls together with financial reports Collins, enron scandal essay, Enron Company created over partnerships starting when it merged with Calpers California PublicRretirement System to create JEDI Joint Energy Development Investments fund, enron scandal essay. Enron thought that these partnerships were temporal solutions for temporal cash flow problems. From the final analysis, the conspiracy of Lay, Skilling and others led to the collapse of the company due to fraud, false reporting of revenue, enron scandal essay accounting practices and general disregard for virtually every tenet enron scandal essay business enron scandal essay Collins, This situation has brought about many lessons including showing hoe companies actually make their money and if the business is sustainable and legal.
Enron has also demonstrated that there is need for significant reform in the accounting and corporate governance in the United Enron scandal essay. It implies that the government regulations have a lot of limitations and its capacity to collect the problem. There is need for comprehensive reforms of accounting procedures for publicly owned companies for the promotion and improvement of the quality and transparency of financial reporting by both internal and external auditors, enron scandal essay. Companies are now required to list and track performance of their material risks and associated control procedures. The chief executive officers are supposed to vouch for enron scandal essay financial statements of their companies for clear accountability and transparency, enron scandal essay.
The audit committees must indecently of the company senior management audit the board of directors. Companies can no more offer loans to the directors of the company. The collapse of the Enron company affected greatly the lives of the employees who were subjected to a hail of legal problems, pointing of fingers by many people including the politicians, and enron scandal essay alleged crimes. Most obvious the Enron employee who were highly skilled and well paid loss their jobs. They were forced to look for vacancies elsewhere after the uprupt collapse of Enron.
On top of it many of these employees had their life savings totally invested in the Enron stock that virtually turned worthless overnight. The United States was affected in several ways by the Enron scandal apart from the induvial enron scandal essay. The scandal itself brought to light the signicance of integrity in accounting and business in general. It also led to the creation of safeguards to control such things not enron scandal essay happen again or not to such extent. From the ethical point of view, the Enron scandal unveiled the most significant part of legislation that is associated with the oversight of corporate ethics.
It provides guidelines and requirements for Accounting, financial disclosure, enron scandal essay, the ethical behavior of corporations and the like McCrie, Having looked at enron scandal essay Enron company scandal from the retrospective point of view, the scandal changed the life of very many people in the United States and elsewherew in the world. The scandal forced every enron scandal essay and individuals to look at themselves and have fully realization about the impacts andconsequences of reckless greed and the breakage of laws on the idea. It is now the responsibility of every person to be vigilant enough in whichever enron scandal essay involved avoiding being affected by the similar if not being a victim.
Cruver, B. Basic Books. Dharan, B, enron scandal essay. Foundation Press. Cable News Network. Andersen CEO admits to mistakes with Enron. Humans and Technology, Essay Example. Need a professionally written Custom Essay? Right now, you can get a professionally written essay in any discipline with a. We're now sending you a link to download your e-book, please check your e-mail. Thank you! You can receive the notifications now. It's pleasure to stay in touch! Show all. Paper Types Movie Review Essay Admission Essay Annotated Bibliography Application Essay Article Critique Article Review Article Writing Assessment Book Review Business Plan Business Proposal Capstone Project Case Study Coursework Cover Letter Creative Essay Dissertation Dissertation - Abstract Dissertation - Conclusion Dissertation - Discussion Dissertation - Hypothesis Dissertation - Introduction Dissertation - Literature Dissertation - Methodology Dissertation - Results GCSE Coursework Grant Proposal Interview Lab Report Marketing Plan Multiple Choice Quiz Quiz Personal Statement Poem Power Point Presentation Power Point Presentation With Speaker Notes Questionnaire Reaction Paper Research Paper Research Proposal Speech SWOT analysis Term Paper Thesis Paper Online Quiz Resume Outline Literature Review Movie Analysis Statistics problem Math Problem Article.
Get a Free E-Book! The Enron Scandal, Research Paper Example. Pages: 6 Words: Research Paper. Need a custom Research Paper written for you? HIRE A WRITER! Introduction The ENRON was the 7 th largest U. How the scandal was discovered The scandal was discovered on October 22,by the Securities and Exchange Commission when a huge loss had been announced by the Enron expressing a major public sign of trouble. Need for the legislation Enron Company was found to be using complex dubious schemes for energy trading. Those involved in the enron scandal essay and how they were punished Enron Company created over partnerships starting when it merged with Calpers California PublicRretirement System to create JEDI Joint Energy Development Investments fund, enron scandal essay.
Enron scandal essay following are blame for Enron: Lax accounting that was directedly Arthur Anderson AA Company. CFO Andrew Fastow who was responsible in setting up these partnerships was committed to jail for six years on the September 26, Timothy Belden was sentenced to serve 2 years probation for trading the schemes on Jeff Skilling who was the chief executive officer helped Enron to rise very fast through his knowledge in banking and finance. He was involved in trading of energy electrical contracts and he was imprisonment for 24 years on October 23, Chief Executive Officer Kenneth Lay who had enlisted the assistance of Jeff Skilling a young, sharp banking and finance consultant, died on July 23, before the care could be completed.
The media was also involved for its exaggeration and being enron scandal essay for Enron operations. Implications of this situation This situation has brought about many lessons including showing hoe companies actually make their money and if the business is sustainable and legal. Those affected by the scandal The collapse of the Enron company affected greatly the lives of the employees who were subjected to a hail of legal problems, pointing of fingers by many people including the politicians, and even alleged crimes. Conclusion Having looked at the Enron company scandal from the retrospective point of view, the scandal changed the life of very many people in the United States and elsewherew in the world, enron scandal essay.
References Bryce, R. Public Affairs. Collins, D. Dog Ear Publishing, LLC, enron scandal essay. Stuck with your Research Paper? Get in touch with one of our experts for instant help! Messenger Live chat.
Enron scandal and accounting Fraud Case essay
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Enron Scandal Essay Words | 3 Pages. The reason of Enron Corporation downfall for audit failure is conflict of interest and accounting fraud. This is because it has been suggested that conflicts of interest and a lack of independent oversight of management by Enron's board contributed to the firm's collapse. Some have suggested that Enron's Nevertheless, this fails to be possible as was the case with the Enron Company. This scandal was discovered in October and it eventually led to Enron Corporation bankruptcy. Enron Corporation is actually an American energy company that was based in Houston. In the American history, the company was the biggest bankruptcy reorganization and The scandal was discovered on October 22, , by the Securities and Exchange Commission when a huge loss had been announced by the Enron expressing a major public sign of trouble. Enron filed for bankruptcy on the month of December after the commission started inquiring into the company’s accounting practices
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