Enron
In a matter of fifteen short years, America's 7th largest company, Enron, employing 21, 000 in more than 40 countries, collapsed and filed Chapter 11 reorganization bankruptcy. Confidence plummeted once the news emerged about the company's tremendous financial liability. A number of investigations have ensued-four being done by Congress, one by the financial regulator, the Securities and Exchange Commission, and one by the Labor Department.Enron's inception took place in July 1985 when Houston Natural Gas merged with InterNorth, a natural gas company based in Omaha, NE. Kenneth Lay, formerly CEO of Houston Natural Gas, became the now-named Enron's first Chairman and CEO in February 1986. This deal combined several pipeline systems, which established the first nationwide natural gas pipeline system. As early as 1987, Enron realizes that oil traders in New York have overextended the company's accounts by almost $1 billion. In 1988, Enron seizes the opportunity to expand overseas in England due to
Perhaps in an attempt to cover her own reputation, Sherron Watkins, Enron Vice President, confronted Kenneth Lay in a lengthy letter outlining the numerous improprieties the company was engaged in. She even went so far as to implicate Donald Duncan, Arthur Andersen's Enron auditor, in the scheme. Jeffrey Skilling, President and COO in February 2001, doesn't take to the hot seat too well and resigns, which raises eyebrows as to the "jumping ship" mentality of top executives at Enron. Andrew Fastow, Enron's CFO from May 1998 through October 2001, is credited with Enron's "innovative" financial dealings. Fastow, beginning in 1997, began using off balance sheet SPE's to increase capital and hide the mounting company debt. In conclusion, one must question the accounting and business practices Enron was involved in. The use of special purpose entities inconsistent with GAAP, the investment of employees money in company stock instead of diversifying, and management selling stock while prices were high are all eth
Some common words found in the essay are:
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Approximate Word count = 682
Approximate Pages = 3 (250 words per page double spaced)
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