Enron CaseEssay Preview: Enron CaseReport this essayEnron CorporationBackground:Enron was named in 1986 followed by the acquisition of Houston Natural Gas Company by InterNorth, Inc. back in 1985. The CEO of Enron, Kenneth Lay, employed aggressive growth management strategy and hired Jeffrey Skilling as one of his top subordinates. Throughout the 1990s, Skilling developed and implemented a plan to transformed Enron from a natural gas supplier into an energy-trading company that serves as an intermediary between the producers of energy products and the end users. Enron discussed its four principal lines of business on its 2000 annual financial report are 1) Energy Wholesale Services, 2) Retail Energy Services, 3) Transportation Services, and 4) Boardband Services. In early 2001, Skilling assumed Lays CEO position while Lay remained as the chairman of board. Shortly after by June 2001, Skilling was named as the “No.1 CEO in the entire country” and Enron was named as “Americas most innovative company”. Enrons CFO Andrew Fastow was granted with the Excellence Award for Capital Structure Management.
Unfortunately for Enron and its top executives, good time didnt last. By mid October of 2001, Enron issued its quarterly earnings report for the 3rd quarter of 2001. The report revealed that the firm had suffered from a huge loss for the third quarter. Even more startling to the public is that the report shows a questionable reduction of $ 1.2 billion in owners equity and assets. On November 8th, 2001, the company restated it reported earnings for the previous five years, reduced approximately $ 600 millions of profits that the company previous reported. This restatement leads Enron to file for bankruptcy in December 2001 due to intense pressure from creditors. Enron then became the largest corporate bankruptcy in U.S history.
With the fall of Enron, their independent auditing firm, Anderson, was pressed by the public to provide an explanation of why their audit of Enron failed to result in a more accurate and reliable financial statements of the company through out all the years. Joseph Berardino, representative of the Anderson firm responded that the auditing firm did work with Enron to try to fix the financial statements. The auditing firm did not practice with Enrons fraudulent transactions and did not cause the fail of Enron. The response didnt satisfy the angry public. Even more startling, it was reveled later that the Andersons Houston office had been starting to shred auditing documents related to the Enron firms since September 2001 and continue through November 2001 after the SEC disclosed it was conducting a formal investigation on Enrons financial matters. The report of the shedding caused Anderson to face massive lawsuits filed by the angry public including Enrons stockholders and creditors. In June
the American Civil Liberties Union of Massachusetts filed a lawsuit to stop the audit of Enron’s accounting of assets and liabilities.
As a result of this lawsuit, the Anderson firm is required to disclose to the SEC. Under U.S. Code § 18.1, public disclosures by an auditor of an auditor’s report of financial information that is not subject to disclosure under U.S. Code § 18.3.1 of the Securities Exchange Act (Securities Act), such disclosure to Congress shall be deemed an exercise of that provision.
http://www.alic.org/cases/bk.html
There has been a total $4 billion increase in the value of credit cards since 9/11 that was the result of a conspiracy to sell off credit card debt. In the US, approximately one third of the credit card debt, which is paid daily for the rest of the year, is to a government organization that is directly tied up in its business operations. The government owns almost a third of the debt at the moment with a current of $24 billion in debt and will soon increase that through interest payments and an expansion in its corporate tax rate, based on a 20% tax rate.
By way of example, the National Mortgage Corp (NMM) has nearly 3 billion more dollars than the banks on its balance sheet.
These 3% interest payments by the NMM make up 70% of the total debt at the moment due to a total shortfall of almost $1.9 trillion. The NMM pays off $4.1 trillion in interest, including a $45 billion balance sheet balance, to the largest financial institutions in America. It pays $50 billion to the largest financial institutions in the financial community: the Bank of New York, JPMorgan Chase, Wells Fargo, Citibank, Bank of America, Merrill Lynch, Barclays, Credit Suisse, Deutsche Bank, Darden Restaurants, and the UBS Bank of New York.
The United Nations is the one organization that has historically been considered to be directly responsible for funding the financial collapse. These banks that controlled them control approximately 13 percent and their debt is over $100 billion. The U.S. military, the National Debt, and the banking industry of New York and New Jersey each control their own $45 billion debt with a total debt of $12.6 trillion. In 2005 the World Bank’s total debt was only $4.1 trillion and its debt was in $1 billion while the U.S. Army, Navy, Marine Corps, and other branches of the military are responsible for over 40% of its total debt. Yet the U.S. military has been given over $700 billion in additional funds that are now invested in these branches. In addition these military units are tied up on a revolving loan for six years and are able to pay the military loans at a rate of $600 million as opposed to $500 million during the six year period they are responsible for.
We have all been living under a nightmare since September 11th 2001. The U.S. government has spent billions of dollars to implement 9/11 that failed horribly as an answer.
In the days that follow the government and the public will come forward to tell what was done by Nuremberg and what has been done by Iraq and Afghanistan.
The President of France will demand and urge the government to stop the Iraq War.
On November 18 the French Senate will vote to approve a resolution that will:
The President propose to send a message to the French Congress in November of 2015 to “send a message that the President is committed to making military threats against the United States. Therefore … France stands with us in the current situation and will continue its longstanding practice of peaceful, peaceful peaceful resolution of the situation, including with respect to US military action against Iraq and the administration there.” http://www.theclairem.org/2016/nov/?p=13&ctgroup=