Enron Scandal

Topics: Initial public offering, Enron scandal, Arthur Andersen Pages: 2 (349 words) Published: April 28, 2009
Root problems of the Enron Scandal

The main problem of the Enron scandal was that they committed business fraud. This is what the root problem of the company was. The sad thing about the Enron scandal was that approximately 22,000 men and women lost their jobs. Not only did it affect the people who worked for the company but the problem was that it also affected other accounting firms that worked directly with Enron, for example the company Arthur Anderson went under because of the Enron scandal and this also directly affected the business world. Going back to the main root problem was that Enron reported false information about their financial stance. The president of Enron gave many reports as to why they were losing money and he carefully thought out a plan to hide the financial situation that the business was in. When Enron teetered on the verge of bankruptcy, the accounting firms stayed behind the scenes making certain deals which were also very carefully practiced out. There were lots of little root problems between the president, accounting and outside parties that caused the Enron scandal. Misinformed parties, stealing and lying caused the downfall of Enron. “In early 2000, Enron let it be known that it was considering a separate public offering for its Internet operations. Analysts who raised prickly questions about an initial public offering could be assured that their firm wouldn't be chosen for the underwriting. That I.P.O. never happened, of course, as Enron's plans for the broadband business collapsed. Nevertheless, Wall Street failed to ask the questions that might have protected investors from Enron's plunging market value."” http://whatreallyhappened.com/WRHARTICLES/enron.html sadly again, many people lost their jobs because of selfish acts of wrongful doing. Enron had a lot going for them and it all got tossed out of the window because of business fraud.

References:

“What Really Happened” The Enron Scandal. Retrieved January 14, 2009...
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