indirectly in high-risk land ventures and other commercial development projects. At the time, federal authorities estimated that the closure of Lincoln Savings and Loan would cost U.S. taxpayers at least $2.5 billion. Congressional hearings into the collapse of Lincoln Savings and Loan initially focused on the methods Keating used to circumvent banking laws and on disclosures that five U.S. senators intervened on Keating's behalf with federal banking regulators. Eventually, the
Words: 4502 - Pages: 19
creation of the Sarbanes–Oxley Act of 2002. The scandal also affected the wider business world by causing the dissolution of the Arthur Andersen accounting firm. The Enron scandal, revealed in October 2001, eventually led to the bankruptcy of the Enron Corporation, an American energy company based in Houston, Texas, and the de facto dissolution of Arthur Andersen, which was one of the five largest audit and accountancy partnerships in the world. In addition to being the largest bankruptcy reorganization
Words: 949 - Pages: 4
family members who invested in them and enriching himself. His manipulation of the off-balance-sheet partnerships to take on debts, hide losses and kick off inflated revenues while banning employees' stock sales was one of the reasons triggered the collapse of the company and its bankruptcy. Did Enron’s bankers, auditors and attorneys contribute to Enron’s demise? If so, what was their contribution? One part of the fallout from Enron's demise involves its relations with banker, auditor and attorneys
Words: 2137 - Pages: 9
Case Studies to accompany Auditing and Assurance Services in Australia by Gay and Simnett Prepared by Renee Radich and Philip Ross [pic] McGraw-Hill Australia [pic] A Division of The McGraw-Hill Companies Copyright © 2002 McGraw-Hill Australia Pty Limited Additional owners of copyright are named in on-page credits. Apart from any fair
Words: 3676 - Pages: 15
Enron Corporation 1. Why did the company collapse? Enron In order to understand what happened within the company we need to start with its origins. Enron Corporation Inc. (later became Enron) begun operating in Huston Texas in 1985. It started from a merger of two natural gas companies, becoming the largest commercial, natural gas pipeline operating in the United States at that time. Throughout Enron’s humble beginnings it generally centred in the delivery of gas to utilities or businesses at
Words: 1797 - Pages: 8
Company Background : Essentially called Enteron but then the name was quickly abbreviated to Enron. Industry: Energy Founded in United States, Omaha, in 1985 Enron Corporation, U.S. company that in 2001 became the largest bankruptcy and stock collapse in U.S. history up to that time. The company was formed in 1985 when InterNorth purchased Houston Natural Gas to create the country's longest natural-gas pipeline network. Renamed Enron in 1986, the company transformed itself in the 1990s from a
Words: 1450 - Pages: 6
A E-mail: wyl_2001_ren@126.com, carolee1989@gmail.com Abstract The Enron scandal, revealed in October 2001, eventually led to the bankruptcy of the Enron Corporation, an American energy company based in Houston, Texas, and the dissolution of Arthur Andersen, which was one of the five largest audit and accountancy partnerships in the world. In addition to being the largest bankruptcy reorganization in American history at that time, Enron undoubtedly is the biggest audit failure. It is ever the most
Words: 3062 - Pages: 13
A E-mail: wyl_2001_ren@126.com, carolee1989@gmail.com Abstract The Enron scandal, revealed in October 2001, eventually led to the bankruptcy of the Enron Corporation, an American energy company based in Houston, Texas, and the dissolution of Arthur Andersen, which was one of the five largest audit and accountancy partnerships in the world. In addition to being the largest bankruptcy reorganization in American history at that time, Enron undoubtedly is the biggest audit failure. It is ever the most
Words: 3062 - Pages: 13
ethical behavior of corporate managers (McPhail 2001). The collapse of companies such as Enron, WorldCom and Global Crossing in the USA, HIH Insurance and OneTel in Australia, and Parmalat in Italy, has led to a loss of confidence by the investing public in the system of financial reporting and accountability. The globalization and diversification of accounting services, combined with market competition and high profile corporate collapses has drawn attention to the accounting profession and its perceived
Words: 2284 - Pages: 10
any concerns brought forward by Watkins. In fact, the law firm may have helped structure some of Enron’s special-purpose partnerships. The law firm never did claim liability, but did pay $30 million to Enron for contributing to Enron’s inevitable collapse. The Merrill Lynch Company also faced scrutiny in the Enron investigations. The SEC and federal prosecutors questioned the validity of a transaction between Merrill Lynch and Enron. “It was thought that Merrill Lynch went ahead with a deal that
Words: 1701 - Pages: 7
