Mark-to-Market: The Fall of Enron John Smith State University Mark-to-Market: The Fall of Enron Enron was the face of business in the 1990’s. Rising to meteoric heights never seen before in the business world, to having just as epic of a fall. The core reason behind this meteoric rise and epic fall? Mark-to-Market (M2M) accounting principles. This paper will be presented in four sections. The first section defines and explains the term of M2M. The second section discusses the way M2M
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27-48 ENRON AND ARTHUR ANDERSEN: THE CASE OF THE CROOKED E AND THE FALLEN A Gary M. Cunningham Visiting Professor Department of Business Administration Åbo Akademi University Turku, Finland Jean E. Harris Accounting Department Pennsylvania State University, Harrisburg Campus School of Business Administration Middletown, Pennsylvania USA ABSTRACT Outside the US, the failures of Enron and Arthur Andersen remain puzzles. How could the accounting and audit failures associated with Enron and Arthur
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The Problem with Business Thesis: In many businesses today ethical decisions take a backseat to profit, I believe businesses should follow a set of ethical standards and not focus solely on profit for four reasons: (1) to have respect for human dignity, (2) private lives and business lives cannot be separated, (3) ethical decisions can lead to more profit, and (4) unethical decisions can lead to serious consequences for the people executing them. There are many decisions a business must make
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role may create differences from other forms of crime. 4. Analyze the role of “opportunity” and how it contributes to white collar crime. Provide specific examples to support your response. When Edwin Sutherland first began his study/analysis under the Traditional Summary Reporting System, there was a limited amount of information available on White Color Crime. The white-collar offenses that are measured are fraud, forgery/counterfeiting, embezzlement, and all other offenses. Because
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executives confessing to engage in price gouging, tax dodges, accounting shams, employee rip-offs, and other shady unacceptable acts are coming to light daily. Unethical and illegal practices are documented from the RJR Nabisco scandals in 1988 to today’s Enron, WorldCom, Merrill Lynch, Arthur Anderson, Xerox, and endless other corporations. The world realizes now that corporate greed is not about one-bad company, but large companies in general that have adopted unacceptable guidelines for corporate behavior
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Only months before Enron Corp.’s bankruptcy filing in December 2001, the firm was widely regarded as one of the most innovative, fastest growing, and best managed businesses in the United States. With the swift collapse, shareholders, including thousands of Enron workers who held company stock in their 401(k) retirement accounts, lost tens of billions of dollars. Investigations of wrongdoing may take years to conclude, but Enron’s failure already raises financial oversight issues with wider
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1. What are the four major types of firm in the U.S, how are they defined, and what are the key differences between them? I understand from the course text that within the context of corporate finance the four types of firms in the U.S. are sole proprietorship, limited liability companies, partnerships and corporations (Berk & DeMarzo, 2011). These four firms are fundamentally different in their makeup and operations. To begin with a corporation is a legally defined artificial being with legal powers
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as it pertains to legal matters or for the purpose of finding or preventing financial misrepresentation. Their role is not to merely provide auditing services and problem solving abilities, but to present expert information by employing deductive analysis of financial reporting to determine fraudulent or negligent presence. According to Astutie & Utami a forensic accountant is like a [detective] and should inquire accurately which an indicator of fraud (p.123) is. Being sought for their investigative
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Companies such as Enron, Ford, Union Carbide and Johnson & Johnson have all had occasions where unethical practices have reared their ugly heads and each chose to handle things differently, with varying degrees of consequence. Each of these company’s bout with unethical behavior will be examined. In July of 1985 Houston Natural Gas merged with Inter North to form Enron, originally Natural Gas Pipeline Company. In 1989 Enron began trading natural gas commodities. In June 1994 Enron traded its first
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has abused its power and encountered the wrath of social interest groups or the government. Using content, concepts, and class discussion points from chapters 1 – 3, introduce and discuss the situation and the current state. Conduct a stakeholder analysis and make recommendations for an improved outcome, using the same resources. Support your discussion with evidence from reputable resources, as well as content and concepts from the text. ANSWER I was overwhelmed while doing the internet news
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