Sunday, August 25, 2019

Corporate Research Paper Example | Topics and Well Written Essays - 500 words

Corporate - Research Paper Example Established in 1985 as an energy company in Houston, Texas, Enron Corporation, in a move to diversify along its business, created SPEs (Special Purpose Entities). In this spree, the much needed amount for the creation of such vehicles was received from the internal employees of the company itself. Adding to the woes, Enron started selling the energy commodities by acting as a broker and profited by the difference between the prices of sellers and buyers, as it had entered into separate contracts with them (AACSB 2002). â€Å"Enron was fond of another procedure known as mark-to-market, which allowed it to increase the value of present assets held by the company by estimating future market prices. Since Enron dominated the energy trading business, the prices by which it marked-to-market were largely subjective- that is, determined by Enron itself in accordance with the earnings it wanted to report.† Defying the laws further, Arthur Anderson, with an intention to show loyalty to the company, provided consultancy to the Corporation and presented misleading and faulty audit data of the Corporation to the stakeholders and investors (Rittenberg et al, 2009, p. 427). The results were graver than imagined. It left Enron bankrupt, due to losses running into billions (debt- $3 billion and losses- $638 million). Apart from financial losses, it also suffered blemishes on its reputation and delisting of its shares and stock. Employees also suffered the loss of their jobs. Data is valuable only if it is in the right hands and used in the right sense. Information contained in data is sensitive and can ruin the fate of the organization handling the data. Thus, data analysis suffers from reliability, validity, authentication and verification. Enron Corporation acted against the transparency and responsibility of being an ethical organization for its investors and invited lethal damage to its

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