Enron Accounting Scandal

1706 WordsJul 29, 20107 Pages
The Enron Accounting Scandal of 2001 There are many accounting scandals that have occurred throughout United States History. Many scandals occur even without outsiders knowing anything that had occurred. Companies try their best to keep many of the accounting scandals quiet. Everyday, there are political and business fraud happening, and most of it goes unnoticed. No company wants to admit that there was a problem or that people within the company are not trust worthy. However, when executives in large corporations take scandal to the extreme, there is no way of keeping out of the spot light. Unfortunately, scandals are the tip of the iceberg. They represent visible failures and companies could really go down for such…show more content…
Ultimately, Enron became bankrupt. This scandal is the one of America’s largest investigations into a firm’s illegal accounting practices and attempt to conceal it from the shareholders and credit lenders. It was too late for Enron to keep quiet and the many accounting issues that they were going through were now about to be out in the open. Enron’s stock was at its highest reaching at over $90 per share but quickly bottomed out at 9 cents per share. Stockholders, investors, and creditors wanted to know how one of the nation’s top accounting firms could have missed such changes and irregularity in Enron’s accounting practices. This was one reason that led to investigation into the accounting practices of the firm (Kay, 7). As a result, the US Department of Justice brought obstruction of justice charges against Andersen which ultimately ran Andersen out of business. Because of these charges, Andersen’s limited liability partnership found themselves in unfamiliar territory, and filed for bankruptcy shortly thereafter. Enron was estimated to have about twenty-three billion in liabilities which included outstanding debt and guaranteed loans. There were so many people and companies involved with the Enron Scandal of 2001. So many people lost their jobs, their lives due to bankruptcy, and their dignity. Another key person involved with this accounting scandal is

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