1,268
19
Essay, 2 pages (300 words)

Enron bankruptcy and work ethics assignment

From the documentary called “ Smartest man in the room” I will elaborate my thoughts about the causes of Enron’s downfall below. Encouragement of dishonesty. Kenneth lay was informed by the auditor in the board meeting that his two oil traders, Louis Forget and Tom Minestrone were manipulating Enron’s earning, destroying records, gambling the earning and presented a falsified bank records to Enron. Kenneth Lay ignored it and did nothing. In fact Kenneth Lay sent a telex to Louis Forget saying “ Please keep making us millions”.

This wows that Kenneth Lay instead of reducing Enron’s risk he encouraged his traders to gamble more which increases the risks of the company. Managing by risk. When Jeff Killing appeared to be the new CEO of Enron, instead of relying on the production of natural gas to get profit, Jeff killing introduced a new way to get profit, by transforming energy to be traded for stock market, he said “ we like making risk, because we make money by taking risk” They keep losing billions of dollars by making questionable risk but the way Enron cover up oases are by applying mark-to-market.

Mark-to-Market accounting allowed Enron to book potential future profits. In Mark-to-Market accounting the company used projected figures for their profit rather than using actual figures, this may cause to misleading investors as they only seen the profits as what the company said The lack of untruthfulness If the management was truthful, there could be no dubious accounting techniques such as mark- to- market which covered the corporate losses and huge debts.

If there could be truthfulness, Enron’s officials would not be involved in the corrupt and fraudulent financial deals which led to collapse of business. If there could be truthfulness, the management would have hired transparent auditors. The low level employees could prevent the bankruptcy by asking why. They never understand Enron’s motto of “ ASK WHY? ” Employees never ask why it generates money effectively with such unethical practices. Why mark to market concept was introduced. Employees knew it was wrong but they carried on with it anyway.

Thank's for Your Vote!
Enron bankruptcy and work ethics assignment. Page 1
Enron bankruptcy and work ethics assignment. Page 2
Enron bankruptcy and work ethics assignment. Page 3

This work, titled "Enron bankruptcy and work ethics assignment" was written and willingly shared by a fellow student. This sample can be utilized as a research and reference resource to aid in the writing of your own work. Any use of the work that does not include an appropriate citation is banned.

If you are the owner of this work and don’t want it to be published on AssignBuster, request its removal.

Request Removal
Cite this Essay

References

AssignBuster. (2022) 'Enron bankruptcy and work ethics assignment'. 26 September.

Reference

AssignBuster. (2022, September 26). Enron bankruptcy and work ethics assignment. Retrieved from https://assignbuster.com/enron-bankruptcy-and-work-ethics-assignment/

References

AssignBuster. 2022. "Enron bankruptcy and work ethics assignment." September 26, 2022. https://assignbuster.com/enron-bankruptcy-and-work-ethics-assignment/.

1. AssignBuster. "Enron bankruptcy and work ethics assignment." September 26, 2022. https://assignbuster.com/enron-bankruptcy-and-work-ethics-assignment/.


Bibliography


AssignBuster. "Enron bankruptcy and work ethics assignment." September 26, 2022. https://assignbuster.com/enron-bankruptcy-and-work-ethics-assignment/.

Work Cited

"Enron bankruptcy and work ethics assignment." AssignBuster, 26 Sept. 2022, assignbuster.com/enron-bankruptcy-and-work-ethics-assignment/.

Get in Touch

Please, let us know if you have any ideas on improving Enron bankruptcy and work ethics assignment, or our service. We will be happy to hear what you think: [email protected]