Enron Case Study Enron was a company that started out small, but through some ethically unsound decisions, grew to control a large percentage of the energy market in America. In order to expand financially, Enron's executives skirted the law, creating several "independent" companies, called "special-purpose entities" (SPEs) into which they were able to hide many bad and devalued assets. In short, the executives used Enron money to create seemingly independent companies

People's confidence was put in question for such an important matter. It showed common people, who are not connected to everyday financial news the way in which money can be made through illicit means under the rules and regulations of the state and of the accountancy system. Moreover it broke the trust of investors, of employees, and of stock owners. This can have a long-term effect as investing companies

Enron was at one time considered to be a highly successful energy firm based out of Houston, Texas. The company was initially formed from a merger of two prominent gas pipeline companies in 1985, and the company's scope then broadened to include the provision of products and services in the realms of electricity, natural gas, and communications. Enron's reach expanded beyond the United States to the international market, as the

Enron hid most of its debts by establishing several LLPs, with some of them being secretly ran by Andrew Fastow, CFO at Enron. By counting only the gains and losses of the companies, but not having to report the LLPs on its financial sheet, Enron's financial position seemed very good. Consolidating the statements would have defeated the purpose of Fastow because the goal was to dump debt, not to report

Enron Leadership Enron collapsed very quickly in November 2001, and its failure should have been a warning to serious dysfunctions in the entire corporate and financial system, but this did not happen. Its executives admitted that they had falsified its records going back for at least five years, although in reality they had been doing so since the 1980s. When the company filed Chapter 11 bankruptcy it laid off over 20,000

If I was a legislator, I will be doing this act and I will not be swayed or affected by friends and lobbyists alike. Response to Ji Woo Chai: Indeed, the Sarbanes-Oxley Act was able to put in place controls and measures to prevent the reoccurrence of the Enron scandal. However, there has to be more done because of what occurred before and during the financial crisis. Thus, there may