Group 5 Andrew Beamon Brandon Hall Joseph Gasparini Matthew Pugh

Slides:

Advertisements

Similar presentations

Building on Our Core Values Building on Our Core Values © 2003 by the AICPA The Sarbanes-Oxley Act.

Advertisements

Financial and Managerial Accounting

Financial and Managerial Accounting

Business Ethics & Corporate Governance

Lectures in Microeconomics-Charles W. Upton Back to the Agency Problem.

Enron Corporate Control Presented by: Cary Cheung, Christie Cheung, Rita Chung, Ryan Chan D1: What has the Enron case showed about the problems of corporate.

Executive Compensation and Incentives: Some Lessons from the ENRON Fiasco By Bernard Sinclair-Desgagné, Ph.D. CIRANO and HEC Montréal.

Case 6.1 Enron Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill.

Sociology 114 Joshua Wakeham March 27 th, The Rise of Enron In 1985, in the midst of the deregulation of the gas market, Ken Lay founds Enron. 1990s:

CEO CFO CDO CRO CICO Public companies with more than $10 million of assets whose shares are held by more than 500 investors are required to.

Finance Lecture 9. Keating F&A 9-2 Spring 2008 Outline Lecture 9 Enron Sarbanes-Oxley.

Sarbanes-Oxley Act. 2 What Is It? Act passed by Congress in response to the recent and continuing corporate scandals. Signed into law July 30, Established.

FRAUD EXAMINATION ALBRECHT, ALBRECHT, & ALBRECHT Financial Statement Fraud CHAPTER 11.

Enron Scandal Rebecca Klinger & Aaron Cooper. What is it. Enron was formed in 1985 by Kenneth Lay After merging Houston natural Gas. Revealed in October.

McGraw-Hill/Irwin Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8 AGENCY CONFLICTS AND CORPORATE GOVERNANCE Behavioral.

By Aleksandra Whistle, Rachel Davis and Jie li

1 GLOBAL CORPORATE GOVERNANCE. 2 3 GOVERNANCE SCANDALS 2001: Enron Corp. (Fastow – CFO, Lay – Chairman and CEO, and Skilling – CEO) creation of off-the-books.

Sarbanes Oxley Act. WHY? Public Company Accounting Reform and Investor Protection Act of 2002 Response to a number of major corporate and accounting scandals.

Chapter 1 Accounting: The Key to Success. What’s so important about Accounting? Accounting is at the heart of every business It is the means through which.

1 ©2006 Prentice Hall, Inc.. 2 QUALITY OF EARNINGS AND CORPORATE GOVERNANCE (1 of 2)  Learning objectives Learning objectives  Importance of earnings.

Accounting and Scandals Javier Velez, Eddie Ababio, Michael Burns.

Sarbanes Oxley Act. WHY? Public Company Accounting Reform and Investor Protection Act of 2002 Public Company Accounting Reform and Investor Protection.

Professional Responsibility

Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Case 2.1 Enron: Independence.

Enron: the scandal, the legend.

Enron Corporation Analysis of the Company By: Heather Major & Amanda Walton OL-125 Management.

Corporate Accounting Scandals & Insurance. Agenda for Today The diminishing audit quality of the 1990s The bubble burst Enron, WorldCom, Global Crossing,

Chapter 4 Risk Assessment.

The Age of Compliance How Sarbanes-Oxley affects IT management.

The Impact of the Crooked “E” The Enron Fraud and Scandal And What It Means to Business Today Ed Ferrara MIS5208 – Project 1 – Examples of Corporate Fraud.

Page 1 Enron. Page 2 Enron 1.Revenue Recognition 2.Abuse of fair values - mark-to-model 3.SPEs 4.Auditors’ documentation retention.

Signed into law on July 30, 2002 Response to highly publicized corporate scandals Provisions affect corporate governance, accounting, and auditing Purpose.

1 Disclosure and Transparency - The Brazilian Scenario - Taiki Hirashima - Partner Arthur Andersen - Brazil The Latin American Corporate Governance Roundtable.

1 Today’s Presentation Sarbanes Oxley and Financial Reporting An NSTAR Perspective.

Spiceland | Thomas | Herrmann Financial Accounting Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without.

Sarbanes Oxley Act. The Sarbanes Oxley Act consists of 11 Sections I – Public Company Accounting Oversight Board II – Auditor independence III – Corporate.

By: 1. Kenneth A. Kim John R. Nofsinger And 2. A. C. Fernando.

New York Stock Exchange Enron was a publicly traded company whose shares were listed on the New York Stock Exchange and were bought, held and sold by individuals.

Andrew Fastow G.W. Amos Lauren Wright. Background Born December 22, 1961 in Washington DC Born December 22, 1961 in Washington DC B.A. in Chinese and.

  An ex-employee at Enron, he was been hired by Enron 9 months before it was collapsed.  Author of the book “Anatomy Of Greed : Unshredded Truth from.

CJ225: Fraud Investigation Instructor: Patrick Coughlin, J.D.

1 Sarbanes-Oxley Overview. 2 Sarbanes-Oxley Act Summary The Sarbanes-Oxley Act of 2002 §201Prohibited Non-Audit Services §202Audit Committee Pre-Approval.

ENRON Enron … took great pains to project an image of being a stalwart and responsible corporate citizen…(it) appeared to have superior internal controls,

Case 2.4 Enron: Quality Assurance

ENRON Thomas Clarke. “The company that once held the admiration of the business world, promised the future and envisioned itself to be the world’s leading.

By Brian, Froilan, Lisa, Pedro and Raissa

Accounting Scandals: What we have learned from Enron and World Com Debacle? Pertemuan 04 Matakuliah: F0122 – Seminar Akuntansi Tahun: 2009.

+ Enron the Unsinkable Ship Nancy Vazquez. + Overview Describe the concept of ‘Creative Accounting’. How the unsinkable ship was sunk to the bottom of.

A brief introduction to ENRON SCANDAL Student name: Olga Balzhinimaeva Student ID: Ma3n0231.

The Fall of… Enron and Arthur Andersen ws/specials/enron/

Case 6.2 Waste Management Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent.

Rebecca Gamboa Carole Gutierrez Maria Fernandez Joanne Gutierrez.

Fiasco Report. WorldCom  Founded in 1983 in Mississippi  Bernard Ebbers appointed CEO in 1985  Company went public through merger with Advantage Companies.

Enron Fortune 500 company Largest power and natural gas company Revenue- $100 bn Dhabol power contract in India suddenly reported losses of.

The Income Statement Balance Sheet –The financial condition of the company on a certain date (a snapshot on that date) –What is OWNED and what is OWED.

Building on Our Core Values Building on Our Core Values © 2003 by the AICPA The Sarbanes-Oxley Act.

Enron: 21,000 Arthur Anderson: 29,000 Retirement: $1.2 Billion Pensions: $2 Billion

Financial Accounting John J. Wild Seventh Edition John J. Wild Seventh Edition Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction.

Sarbanes-Oxley: Its effect on the accounting profession Signed into law on July 30, 2002 Response to highly publicized corporate scandals Provisions affect.

Enron: Audit Documentation

The Expense Recognition Principle

INTERNAL FINANCIAL CONTROLS

Enron: Presentation and Disclosure of Special Purpose Entities

The Sarbanes-Oxley Act

INTRODUCTION TO CONTROLLING

ENRON CORPORATION.

Enron Seminar, Spring 2002 Class 2 Enron Before the Fall

INTRODUCTION TO CONTROLLING

Presentation transcript:

Group 5 Andrew Beamon Brandon Hall Joseph Gasparini Matthew Pugh Enron Corp. Group 5 Andrew Beamon Brandon Hall Joseph Gasparini Matthew Pugh

Background Founded An American Energy Corporation 1985 Kenneth Lay Merger of Houston Natural Gas and InterNorth An American Energy Corporation External Auditor: Arthur Andersen LLP

Accounts Affected Mark-to-Market Accounting Losses Written off to SPE Assets inflate profits Purchased assets Projected revenues immediately recorded to books

Key Individuals Kenneth Lay Jeffrey Skilling Andrew Fastow Founder/CEO Retired 2001 Jeffrey Skilling CEO Retired after 6 months Andrew Fastow CFO Mastermind of fraud

Detecting the Fraud Bethany McLean Sherron Watkins Fortune Magazine writer Sherron Watkins VP of Corporate Development Wrote an anonymous letter to Lay about accounting practices

Concealing the Fraud Executives circumvented accounting rules to artificially increase earnings The use of special purpose entities aka “Raptors” to buffer earnings Picked out bad investments, then hedged them

Arthur Andersen Shredded subpoenaed documents Was paid $25 million for auditing services and $27 million for consulting services Prior allegations with Waste Management and Sunbeam Senior executives of Enron worked for Arthur Andersen

Preventative Actions Arthur Andersen Board of Directors CEO/CFO External auditor and consultant Board of Directors Too much upper management involved Lack of attention caused overlook of financials due to incentives and compensation CEO/CFO Wasn’t responsible for signing off on financial statements

Preventative Actions Consolidation Disclosure Requirements Didn’t have to show all entities together which inflated assets and revenues Disclosure Requirements Less requirements for detailing certain accounts Sarbanes Oxley Act 2002

Key People Today Kenneth Lay- Deceased Jeffrey Skilling- Currently in prison Andrew Fastow- Completed prison time and now traveling the country