Nobody downloaded yet

Accounting Implications to Enron Corporation - Case Study Example

Comments (0) Cite this document
Summary
The essay explores the accounting implications of Enron Corporation, an American organization based in Houston. Prior to its bankruptcy, it was among the world's major energy corporations generating high revenues…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER94.9% of users find it useful
Accounting Implications to Enron Corporation
Read TextPreview

Extract of sample
"Accounting Implications to Enron Corporation"

Download file to see previous pages It is evidently clear from the discussion that the Enron Company had a robust outlook of accounts; it was highly valued stock, and it had a good reputation for making profits. Being a fast-growing company with high promotion activities, Enron was heading for great heights in business. These characteristics are ideal for any person who wants to invest, and therefore, Enron had many investors coming. The accountants did not lay out their true and fair financial records. The accountant’s application of creative accounting practices to manipulate the accuracy of the records was a common practice. The management did this by establishing many limited liability special purpose entities in order for Enron’s accounting officers to transfer liability. This bid to ensure all accounts appear without liabilities was a strategy that seeks to maintain a robust and increasing stock price, thereby keeping its investment grade credit ratings. The role of the accountant is to ensure the maintenance of accurate books of accounts, a role that the accountants clearly did not perform. Confidence in the financial information produced by professional accountants is one of the main driving forces for public investments. Accountants have the role of safeguarding the public’s interest by providing information that is true and fair for investors’ decision-making. The manipulation of accounts in order to favor the company and thereby deceive the public to rush to invest is unethical. There is a conflict of interest in these dealings. The accountant has to oversee the maintenance of the image of the organization and at the same time protect the interest of the public. This context becomes worse when an accountant also has personal interests in the dealings of the organization. In such instances, accountants should declare any form of conflicting interests and seek guidance when working during such situations. However, this was the fraud by the organization; the public interest should take precedence over personal and organizational interests. ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Accounting Implications to Enron Corporation Case Study”, n.d.)
Retrieved from https://studentshare.org/finance-accounting/1659992-critically-analyse-the-role-of-the-accountant-in-those-scenariossituationsfollow-case-study-questions
(Accounting Implications to Enron Corporation Case Study)
https://studentshare.org/finance-accounting/1659992-critically-analyse-the-role-of-the-accountant-in-those-scenariossituationsfollow-case-study-questions.
“Accounting Implications to Enron Corporation Case Study”, n.d. https://studentshare.org/finance-accounting/1659992-critically-analyse-the-role-of-the-accountant-in-those-scenariossituationsfollow-case-study-questions.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC
Enron Corporation Scandal
...futures (Li, 2010). The Enron Corporation was founded in the year 1985 and was one of the leading companies offering services in electricity, communications, natural gas and pulp and paper industries. The financial performance of Enron Corporation had also been uniquely impressive before its collapse in 2001 where its annual revenues showed an increase of $9 billion to over $ 100 billion from year 1995 to 2000. However at the end of year 2001 it was brought to attention and revealed that the company’s reported financial condition was sustained mainly because of the systematic, institutionalized and creative plan of accounting fraud. It has been reported...
10 Pages(2500 words)Research Paper
Accounting Fraud: Enron Accounting Scandal
...ratio, inventory turnover, and receivables turnover grounded on the false financial reports victimize more investors. In this regard, the Enron employees must either implement the preparation of the fraudulent profit-priority financial statements or resign from the Enron Company. However, there are conflicting subcultures within the major profit-priority culture. The initial findings on the Enron cash’s reporting transactions violated United States financial accounting standards board policies and processes in the company’s presentation of the financial statements. The corporate social responsibility culture runs counter to the company’s profit-priority...
12 Pages(3000 words)Term Paper
Enron Corporation Assignment
...? Enron Corporation of the of the Enron Corporation Introduction Based in Houston Texas, Enron Corporation was at one time, one of the largest corporations in the world. The company structure was created by the merger of Inter North and Houston Natural Gas by CEO Ken Lay in 1985. Prior to its closure in 2001 for reasons of fraud, accounting and reporting malpractices and misleading the public, Enron was regarded as one of America’s most successful corporations, even being America’s Most Innovative Company on the list of the Fortune 500, and regarded as one of the best...
3 Pages(750 words)Assignment
Enron Corporation
...?Background Enron Corporation was the 7th largest company in the America and the market leader in the energy industry. In 2001 the company filed for at the time the biggest bankruptcy in United States history. The accounting scandal broke out when a whistleblower within the organization called Cheryl Wadkins talked to the authorities. The company used several mechanisms to cook up the books including market to market accounting and by hiding debt using off balance sheet transactions. The organization had a culture of greed and deception. The top executives of the company prior to the demise of the company violated the SEC insider trading bylaws by selling over $600...
6 Pages(1500 words)Case Study
Enron Corporation
..., at their expense. The need to beget more money, the greed to possess was the recognized motive behind such activity of the traders. 3. What type of accounting procedure was used that led to the scam EnronCorporation had employed the 'mark-to-market' type of accounting procedure, wherein they had reported the entire financial year's estimated value, as the profit rather than making periodical assessments of the profit margin, as cash came in. Therefore, the high level of profits reported were untrue and misleading, which can be considered frauds. 4. What excited you most about the...
2 Pages(500 words)Movie Review
Enron Case: Accounting Controversies
...violated generally accepted accounting principles. Surely, generally accepted accounting principles are the foundations of the income statement, balance sheet and statement of cash flows. Surely, generally accepted accounting principles are the foundations of the income statement, balance sheet and statement of cash flows. Conclusively, Enron and Arthur Andersen hit the headlines for their accounting controversy. References Ainslie, E. K. (2006). Indicting Corporations Revisited: Lessons of the Arthur Andersen Prosecution. American Criminal Law Review, 43(1), 107+. Cates, D. C. (2003). Time for New...
5 Pages(1250 words)Essay
Enron Corporation Article
.... Thirdly, Mr. David Duncan held some of the responsibility because he was aware that there were violations with regards to the rules of bookkeeping and was bounded by the ethics of his profession to report such violations. By not doing this, he was responsible to some degree for the final collapse of Enron. Fourthly, the accounting firm of Arthur Andersen held the responsibility because they were hired as auditors to ensure that the accounting rules were being followed. At any point during the audit, they could have reported the misdoings of the Enron officials. Finally, the stock analysts held some blame because they continued to recommend Enron...
2 Pages(500 words)Article
Accounting of Enron
...Accounting of Enron According to Desjardins and McCall (2005), David Duncan was a partner at Arthur Andersen, which was an accounting firm. With regards to the business dealings between Enron and Arthur Andersen, David Duncan had been appointed as the head auditor for Enron, and was thus expected to acquaint Enron’s management team of the firm’s position with regards to its accounts. Moreover David had a duty towards the stockholders of Enron whereby he had the role of a whistle-blower in case of any uncertainties in the firm’s financial records. Considering that he was also a player in the...
2 Pages(500 words)Case Study
Enron Corporation Position Essay
...discuss the ethical considerations of what Enron did to its investors and take a position on whether it was okay to sell stocks on what you believe will be the expected dividends. Enron was a company based in Houston and it specialised in commodities, energy and service corporation. The company was rocked by a scandal in 2001 and this was recorded as one of the biggest scandals of the century as a result of the fact that shareholders lost $74 billion and thousands of employees and investors lost their retirement accounts, and many employees lost their jobs (The ten worst corporate financial scandals of all time, nd). The main players in this particular...
5 Pages(1250 words)Essay
Enron Corporation
...the reputation of any business is largely determined by its ability to assure appreciative performance in the domain of corporate governance. However, with the increasing number of accounting fraud and failures of companies to adhere to particular legal and ethical standards in conducting business, the aspect of corporate governance has emerged as one of the major issue in the business sector today. The issue of corporate governance has mostly gathered strength especially after the collapse of Enron owing to accounting frauds in the year 2001. However, in order to depict the actual reason behind the occurrence of the...
11 Pages(2750 words)Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Let us find you another Case Study on topic Accounting Implications to Enron Corporation for FREE!
logo footer
Contact us:
+16312120006
Contact Us Now
FREE Mobile Apps:
  • StudentShare App Store
  • StudentShare Google play
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • Miscellaneous
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us