The Enron Scandal Essay - 619 Words

The Enron Scandal In a front-page article with no less than four by-lines (7/03, Enron Triggers a Slew of Proposed Fixes But What Will Stick? by Steve Liesman et al.), The Wall Street Journal reports, As more than 10 congressional committees pursue inquiries, 32 Enron-related bills have been introduced to address ills ranging from auditor conflicts of interest to the scams of an unregulated derivatives market. The Securities and Exchange Commission pledges to reform accounting rules, get tough on fraud and overhaul auditor oversight. General Electric Co. says it will issue a disclosure statement the size of a phone book, if thats what investors want. The trouble is that such a phone book, if it reflected the state economic†¦show more content†¦The level playing field catch-word distracts attention from the monstrous discrepancy between the accountancy practised by the government in its own books and what the large corporations get away with. The corporations hide their debts by keeping them o ff-balance-sheet. The government buries its investments. The level playing field is the Mother Lie that has birthed the swarm of distortions and untruths that are now crawling out from under every table and from every crack in the walls. It is gratifying that the media and some of our politicians are starting to recognize some of what ER had warned about for many years. But the most basic lie is still protected by the greatest of taboos. It goes on being drummed into freshmens heads in every country of the world. No Finance Minister can open his mouth without it jumping out at you. The mirage of a self-balancing economy made up of tiny actors that are all powerless individually to affect prices is the scientific version of the level playing field. That could hardly cover an economy dominated by the Microsofts, General Electric, and the Enrons. Surely you have to deal with that obvious clash between the fine theory and the reality to which it is being applied. You might as well sendShow MoreRelatedThe Enron Scandal854 Words   |  4 PagesThe Enron Scandal Background Enron Corporation was an American energy, commodities, and services company based in Houston, Texas. Before its bankruptcy on December 2, 2001, Enron employed approximately 20,000 staff and was one of the world s leading electricity, natural gas, communications, and pulp and paper companies, with claimed revenues of nearly $101 billion in 2000.[1] Fortune named Enron America s Most Innovative Company for six consecutive years. 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Enron became a company that was able to profit by providing deliveries of gas to utility companies and businesses. As the deregulation of electric power rose, Enron diversified the business and entered into an energy broker, which traded electricity and other types of commodities. Enron employed several highly qualified PHDs in mathematics, physics, and economics. Enron continued to enter into contracts with customers and utilizedRead MoreThe Enron Corporation Scandal 1791 Words   |  7 PagesIDENTIFY THE ACCOUNTING PRACTICES THAT WERE ASSOCIATED WITH THE ACCOUNTING SCANDAL. The Enron Corporation failures made world headlines for many reasons ranging from greed from its executives, the alleged malpractice and criminal behaviours, and its quick and disastrous collapse. The most critical factor in Enron’s melt down was the use of creative and manipulative accounting practices to distort reported proï ¬ tability and indebtedness that befell the corporation (A. Holt and T. Eccles, 2002) TheRead MoreThe Enron Scandal Of The United States1855 Words   |  8 PagesThe Enron Scandal is still viewed today as one of the largest corporate bankruptcies in history. The greed that spilled throughout the organization started with gradual disregard for basic accounting principles. Initiated by small discrepancies in the company financial system became extreme financial crimes that left many without jobs and many investors penniless. The Enron scandal led to legislation that tightened restrictions on accounting practices in the U.S. requiring more strict compli ance