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Conduct your own research on the events leading to the collapse of Enron and identify the series of questionable business deals by Enron, in particular, between Enron and Raptor, and between Enron and Condor. How those deals were accounted in the financial statements?
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Enron was created July 1985, through combination of two businesses: Huston Natural Gas Company, a Texas Pipeline company merging with InterNorth, a natural gas company based in Omaha.
Originally Enron was an operator of interstate gas pipelines, but by 1989 Enron diversified into trading energy-related commodities. In a few years, Enron becomes the largest merchant of energy in the United States and the United Kingdom. In 1997, Enron goes ahead with a program to reshape its corporate image to a new, more modern, stylish-looking, environmentally-aware type of company. It introduces a new corporate logo and acquires Zond Corporation, one of leading developers of wind energy power. The purchase leads to the formation of the Enron Renewable Energy Corporation. By August 1997 Enron announces that it is entering the marketplace with new weather derivative products (bets against certain weather conditions); in addition to energy and trade in such ephemera as weather derivatives.
By the year 1999 Enron grew so big, that it became involved in about a quarter of all energy deals in the world.
Before its bankruptcy in late 2001, Enron employed approximately 22,000 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. Enron was considered at that time "America's Most Innovative Company" and the best company to work for, for six consecutive years.
At the end of 2001, it was revealed that its reported financial condition was sustained... [continues]
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Conduct your own research on the events leading to the collapse of Enron and identify the series of questionable business deals by Enron, in particular, between Enron and Raptor, and between Enron and Condor. How those deals were accounted in the financial statements?
-------------------------------------------------
Enron was created July 1985, through combination of two businesses: Huston Natural Gas Company, a Texas Pipeline company merging with InterNorth, a natural gas company based in Omaha.
Originally Enron was an operator of interstate gas pipelines, but by 1989 Enron diversified into trading energy-related commodities. In a few years, Enron becomes the largest merchant of energy in the United States and the United Kingdom. In 1997, Enron goes ahead with a program to reshape its corporate image to a new, more modern, stylish-looking, environmentally-aware type of company. It introduces a new corporate logo and acquires Zond Corporation, one of leading developers of wind energy power. The purchase leads to the formation of the Enron Renewable Energy Corporation. By August 1997 Enron announces that it is entering the marketplace with new weather derivative products (bets against certain weather conditions); in addition to energy and trade in such ephemera as weather derivatives.
By the year 1999 Enron grew so big, that it became involved in about a quarter of all energy deals in the world.
Before its bankruptcy in late 2001, Enron employed approximately 22,000 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. Enron was considered at that time "America's Most Innovative Company" and the best company to work for, for six consecutive years.
At the end of 2001, it was revealed that its reported financial condition was sustained... [continues]
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