Interpretation of the Enron Story - Essay Example

Only on StudentShare

Extract of sample
Interpretation of the Enron Story

Considering the unpredictable circumstances and calculated risks, Enron was successful on paper. This was reflected in the financial reports suggesting the extent of growth in the financial capability of the company.
Specifically, the level of stocks reported by the company has skyrocketed. The information provided by the Enron 10-K annual report suggests that it was only in 1997 that the company experience a decline. The growth, however, can overcome such deficit. The best years of the company was observed from 1998 to 2000. Based on the information, the stock performance of Enron illustrated a positive growth of 37%, 56%, and 87% positive growth during the years mentioned in succession. Positive growth was also recorded from 1993-1995 which showed increase in stock ranging from 5%-25% (Healy and Palepu, 2003).
The growth in stock is generally perceived as an advantage for the company. Increasing the stocks means that more investors become willing to invest in Enron. This will improve the financial resources of the company because the market capital also expands. Accordingly, this performance was fuelled by the intricate schemes of Enron in managing its operations.
By 1995 accountants at Arthur Andersen knew Enron was a high-risk client who pushed them to do things they weren't comfortable doing. James Hecker wrote a parody to that effect in 1995. ...
Download paper


McLean and Elkind stated in chapter 15 that "all that mattered was that the stock was going up." How is this simple statement indicative of Enron's complex management strategy Please support your answer with examples.
Critics have identified the complicated management approach as one of the culprits that caused the firm's collapse…
Author : lbosco

Related Essays

Journalist and Enron
He not only performed his duty as a journalist and a responsible media personnel, but also did instil fear in the other big corporations, from indulging in such illegal methodologies. As Enshwiller points out, "The press should be there to examine, questioning, and bring it to the public".
2 pages (502 words) Essay
Within about 5 years of the emergence of the Internet and the Web, electricity consumption linked to this new phenomenon had surged to 8 percent of total consumption. Naturally enough, this caught the eye of the prosperous energy trader down in Houston. How could Enron play in this exciting new game (Jorion 2003, p. 6)
8 pages (2008 words) Essay
Dream Interpretation
Thus, the attitudes or responses vary due to the particular contexts. "An attitude is the predisposition to respond in a certain way (Fernald & Fernald, 2003)ii". Undeniably, people intend to satisfy desires by their performing attitudes in day-to-day lives. It is unanimous that dreams are psychologically significant and meaningful expression that meant the implication of the life of the dreamer and connotes a specialty of the occurrences of life. 'The Interpretation of dreams' by Freud has added a new dimension in the development of psychoanalytic explanation requiring the successful dream...
13 pages (3263 words) Essay
Enron Corporation Article
This proved to be a blatant violation of the accounting rules and eventually led to the mess that resulted in the bankruptcy of Enron and criminal prosecution of several Enron employees. Secondly, Mr. Kenneth Lay held a great deal of responsibility because he spearheaded the overstatement of Enron's income for four years prior to the bankruptcy. This effectively and efficiently led to his conviction for securities fraud, wire fraud and making false and misleading statements. Thirdly, Mr. David Duncan held some of the responsibility because he was aware that there were violations with regards...
2 pages (502 words) Article
It was only after the scandal that the government decided to do something about the prevention of possible future crimes that might be committed. Ethical considerations for the case and verdict required that no further information on the criminal case was leaked out into the public. As for justice on the crimes that were committed, the defendants had to pay for their crimes and were sent to jail. As much as they claimed that they were innocent, the jury had found them guilty with no biases made. The victims, although suffered terrible losses in terms of finances in the market, nothing more...
1 pages (251 words) Essay
Enron also promoted a corporate culture of callousness when it arbitrarily ranked half of its employees as non-performer which it will eventually fire. The other half remaining may have remained in the company but adopted a corporate value system that is virulently greedy and fraudulent as promoted and reinforced by its leadership through its performance appraisals.
1 pages (251 words) Essay
Got a tricky question? Receive an answer from students like you! Try us!