Enron - 3125 Words

Abstract The financial collapse of Enron had substantial and far-reaching ramifications throughout the financial investment field, tax compliance professions and the accounting profession. Intense Congressional scrutiny resulted in a new era of transparency in financial reporting, stricter reporting standards as provided in Sarbanes-Oxley and substantial penalties for failure to comply with new financial reporting and tax compliance standards in the Internal Revenue Code (Bottiglieri et. al., 2009) Enron Assignment The Enron scandal, revealed in October 2001, eventually led to the bankruptcy of the Enron Corporation, an American energy company based in Houston, Texas, and the dissolution of Arthur Andersen, which was one of the†¦show more content†¦UC s law firm Coughlin Stoia Geller Rudman and Robbins, received $688 million in fees, the highest in a U.S. securities fraud case (DeBare, 2008). At the distribution, UC announced We are extremely pleased to be returning these funds to the members of the class. Getting here has required a long, challenging effort, but the results for Enron investors are unprecedented (Davis, 2008). Sarbanes-Oxley Act Between December 2001 and April 2002, the Senate Committee on Banking, Housing, and Urban Affairs and the House Committee on Financial Services held numerous hearings about the collapse of Enron and related accounting and investor protection issues. These hearings and the corporate scandals that followed Enron led to the passage of the Sarbanes-Oxley Act on July 30, 2002 (Chhaochharia Grinstein, 2007). The Act is nearly a mirror image of Enron: the company s perceived corporate governance failings are matched virtually point for point in the principal provisions of the Act (Deakin Konzelman, 2003). The main provisions of the Sarbanes-Oxley Act included the establishment of the Public Company Accounting Oversight Board to develop standards for the preparation of audit reports; the restriction of public accounting firms from providing any non-auditing services when auditing; provisions for the independence of audit committee members, executives being required to signShow MoreRelatedEnron Of Enron And Enron1209 Words   |  5 PagesEnron Cooperation, is a company that was based in Houston Texas and was an energy company. This company filed bankruptcy in 2001 leaving a lot of its employees that had no knowledge about what was going on jobless and the company investors losing a lot of money. This was one of biggest companies in the united states, it had a lot of assets all over the country and was operating on a lot of profit that nobody knew how and why. The movie, â€Å"Enron, The smartest guy in the room† shows that the companyRead MoreEnron : Enron And Enron1143 Words   |  5 PagesEnron was formed in July 1985 by the merger of InterNorth and Houston Natural Gas (Enron Fast Facts, 2015). Kenneth Lay became chief executive of Enron and he hired Jeffrey Skilling to look after the company’s energy trading operation (The rise and fall of Enron, 2006). Skilling’s plan was to be basically a gas bank where buys gas from suppliers for future years at previously agreed prices and sells the gas to its customers in advance to purchase at specified prices for future years. By doing thatRead MoreEnron Of Enron And Enron1387 Words   |  6 PagesEnron was formed in 1985 from the merger of two gas companies from Texas and Nebraska. Enron became the first company with all-American network of gas pipelines. In 1997 Enron bought power generating company Portland General Electric Corp. worth $ 2 billion. Before 1997 ended, the management turned the company into Enron Capital Trade Resources which became the largest American companies that trade in natural gas and electricity. Revenue increased dramatically from $ 2 billion to $ 7 billionRead MoreEnron And Enron Of Enron1781 Words   |  8 Pagesâ€Å"During the Enron debacle, it was workers who took the pounding, not bankers. Not only did Enron employees lose their jobs, many lost their retirement savings. That s because they were at the bottom of the investing food chain.† In July of 1985, Houston Natural Gas merged with InterNorth, to create Enron, and Kenneth Lay became CEO the following year. In 1989, Enron began trading natural gas commodities. In 1997, Andrew Fastow devised the first steps to hide debts and inflate profits and one yearRead MoreEnron : Enron And Enron Scandal Essay1269 Words   |  6 PagesEnron was one of the largest energy, commodities, and services company in the world. It was founded in 1985 and based in Huston, Texas. Before its bankruptcy on December 2, 2001, there are more than 20,000 staff and with claimed revenues nearly $101 billion du ring 2000. Enron was the rank 16 of Fortune 500 in 2000. In 2001 it revealed that Enron’s financial report was planned accounting fraud, known since as the Enron scandal. In the Enron scandal, Enron used fraudulent accounting practices to coverRead MoreThe, Enron, And Enron1844 Words   |  8 PagesThe complete destruction of companies including Arthur Andersen, HealthSouth, and Enron, revealed a significant weakness in the United States audit system. The significant weakness is the failure to deliver true independence between the auditors and their clients. In each of these companies there was deviation from professional rules of conduct resulting from the pressures of clients placed upon their auditors (Goldman, and Barlev 857-859). Over the years, client and auditor relationships were intertwinedRead MoreEnron : The Collapse Of Enron1644 Words   |  7 PagesEnron was once one of the world s leading energy companies by reshaping the way natural gas and electricity were b ought and sold. They filed the largest corporate bankruptcy in American history in 2001. Enron Corporation was an energy company running out of Texas that was started when two companies, Houston Natural Gas and InterNorth, merged together in 1985. By 1992, Enron became the largest seller of natural gas in North America and began to offer other services like wholesaler trading and riskRead MoreThe Enron Scandal Of Enron Essay1458 Words   |  6 Pagesevent that took place in our economy was the Enron Scandal, which happened in late 2000 and lasted into the following year. Those who were involved in this incident directly such as CEO’s Ken Lay and Jeff Skilling thought what they were doing was not wrong and that they were able to get away with making millions falsely (Seabury, 2008). However, this was a serious crisis situation and many people were affected through the process as well as their money. Enron was valuing themselves at a higher priceRead MoreEnron : The Demise O f Enron1740 Words   |  7 PagesEnron was a corporation that reached heights unknown, only to watch it fall apart from the inside out based on a foundation of falsehoods and cheating. Enron established a business culture that flourished on competition and was perceived in society as an arrogant corporation, mainly because of its corporate leadership. The fairytale of Enron actually ended as a nightmare with it destroyed by one of America’s largest bankruptcies in history. The demise of Enron impacted the livelihood and futuresRead MoreEnron And The Enron Scandal1588 Words   |  7 PagesEnron was a corporation located in Houston, Texas and in just fifteen years the US energy trading and utilities company grew to become one of America’s largest and more successful cooperation’s. Enron suffered a major fall. After being one of the most successful corporations Enron became the biggest company to file bankruptcy in history. In this research paper it will discuss about the history of Enron, the fraud committed and who is to blame. The historical development of white collar crime in the