Essay on CaseAssignment2 - 1409 Words

Case Assignment: Enron Case 9 Yesenia Garcia BUSI 472- B07 LUO Introduction In 1985 Ken Lay took over a couple of big name gas pipeline companies that came together and thus the infamous Enron Corporation began. They offered a variety of services that were not limited to natural gas but also included electricity, communications, and many energy related services. Together, CEO Jeffrey Skilling, Chairman Ken Lay, and CFO Andrew Fastow were able to bring transformation to Enron. They created a multi-billion dollar Wall Street celebrity out of an electricity and gas company. There was an unusual growth spurt in Enron’s profit of about $69 billion from 1998 to 2000. This caught the attention of an anonymous†¦show more content†¦This only increased the habits that employees had of lying in order to survive. Major managers at Enron were also largely responsible for the demise of the good intentions and expectations that Ken Lay had for his employees. He himself became entangled in the lying and stealing, and cheating that was taking place instead of the expectation of a corporation filled with integrity, ethics, and morality. The value of shareholders sank in the eyes of officers and their greed grew. As a result, Enron employees got creative with what they considered to be assets and began to give the appearance of gaining profit while actually losing assets. Contributors to Enron’s Demise: Bankers, auditors, and attorneys Those with close ties to Enron in the areas of banking, auditing, and law also had much to do with its’ demise. A banking firm by the name of Merrill Lynch has been accused of assisting Enron in their endeavors to cover up their financial reports. Merrill Lynch was said to have bought millions in Nigerian barges sold by Enron, which also happened to be greatly financed by Enron. Because of Enron’s investment in Merrill Lynch, there was great fear of losing â€Å"ins† on stocks based on Merill Lynch’s behalf. Another one of the major mistakes that were made was that Enron’s auditor was filled with conflict of interest. Because of