Lesson Learn From Enron and Arthur Anderson
The story of Enron and Arthur Anderson is a tale of great dishonest within the American Global financial system. Arthur Anderson L.L. P once one the highest paid accounting firms in the U.S now in shamble after a U.S. lawsuit. Enron once named “America’s Most Innovative Company” by Fortunes magazine. Two or the countries best companies, now the country most well know financial debacle The lesson that was learned in Arthur Anderson and Enron financial collapse is a warning to both investors and employees of such companies. But before we learn that lesson we need to know what lead these companies down that path and how we can prevent such misfortune from happening with other large corporations.
Enron the Beginning:
Enron was originally an American Energy company base in Houston, Texas. The northern natural gas company was formed in 1932 in Omaha, Nebraska. In 1985 it brought the smaller Houston natural gas and changes it’s named to Enron. The company was involved in transmitting and distributing electricity and gas throughout the United States. Enron developed, built and operated power plants and pipelines while dealing with there rules of law and other infrastructures world wide. The company owned a large network of natural gas pipelines which stretched worldwide including Northern Natural Gas, Florida Gas Transmission, Transwestern Pipeline company , and partnership in Northern Border Pipeline from Canada. At its peak Enron employed approximately 22,000 people and was one of the world’s leading electricity, natural gas, pulp and paper, and communications companies, with claimed revenues of 111 billion. Soon this rose’s picture would change fairly quickly when the company CEO Kenneth Lay told the public that Enron would have to decrease shareholders equity by $1.2 billion. This followed an announcement by the Dynergy to bail out of the deal to buy out Enron on November 28, 2001. This unraveled Enron fixed...
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