Enron Video Assessment
The video shown in class Friday, the 27th of January, told of the scandal of a company named Enron that basically committed accounting fraud for over six years. This brazen crime placed the company at the top of fortune five hundered companies as America's most innovative company by claiming huge annual revenues averaging in excess of one hundered billion dollars. Since the company went bankrupt in Decemeber of 2001, it has become the epitomy of corporate fraud, and brought about a new federal law known as the Sarbanes-Oxley Act to try and prevent this from happening so easily.
Enron employed many people. Estimates were up ...view middle of the document...
The two continued to hide the companies' liabilities from the books, and also continued to lie about the companies' bottom line income for the rest of it's duration.
The company filed for bannkruptcy in 2001 under the counsel of Weil, Gotshal and Manges; however, it emerged from bankruptcy in the latter part of 2004 under a approved plan or company reorganization. This ordeal has become known as one of the nations largest bankruptcy cases to have ever taken place. The companies' name was changed to Enron Creditors Recovery Corporation, and became more focused on recovering lost assets of the former Enron. In 2006, the company sold it's last business, Prisma Energy International, to Ashmore Energy International Limited.
Though the actions committed by the leaders of Enron have become infamous and well-known throughout the nation, it is not the only large company to commit such acts. The pharmaceutical company, Bristol-Meyers Squibb, inflated its revenue by over one and a half billion dollars in 2002. In April of 2002, Adelphia Communications was found to have overstated results of inflating capital expenses and hiding debt. In July of the same year, AOL Time Warner was known to have inflated sales by booking barter deals and ads that it had sold on behalf of others. CMS Energy executed all around trades that artificially boosted energy trading volume in May of 2002. Duke Energy also boosted their energy trading volume and annual income numbers in the same year of 2002.