The Enron and Worldcom Scandals - 1009 Words

The Enron and WorldCom scandals Enron #1. The segment that put Enron in difficulties was the LJM1. That SPE was the worst of all four SPE’s. This one had no independant investor that could put up the 3% that they needed for the controlling investor, where CHEWCO would work as a counterparty accounting to the Ugt;Sgt; guidelines. Enron already owned 97% of CHEWCO, where if they had a controlling investor, the profits from CHEWCO would go directly to Enron’s assets. Later, they did not find a controller investor, and invented another SPE, which was LJM2. The problems in LJM1 still was there that affected LJM2. Arthur Anderson, the auditor for Enron, went ahead and approved of this SPE, knowing that the financial statements had†¦show more content†¦WorldCom #1. In the general ledger of WorldCom, they were supposed to reduce the line cost expense accounts and reducing- in accounts corresponding to the improper and false line cost expense in various reserve accounts. This would through off your balance sheet and your income statement, showing you made profits, which indeed, you never did. Later, the senior management would instruct that the line cost expenses are fraudulently be reclassified. By doing this, they had to adjust the schedules of certain Property, Plant and Equipment Capital expenditure accounts by increasing certain capital accounts for â€Å"prepaid capacity†. In the future periods, the increase of these certain accounts for â€Å"prepaid capacity† would then remain manipulation of choice by Ebbers, which would add to their profits. #3. WorldCom’s board of directors should have reduced the conflicts of interest, so they could exercise the fundamentals of ethics to the shareholder’s or company and to the public’s interest. They could have ensured that financial reported were accurate, complete, understandable, and transparent. The directors should have also ensured that the accounting standards were adequate to protect the investor’s interests. #4. Lay may never been an accountant, but a milkman, but he was assisted in all of these manipulation by his Chief financial officer and his Controller , which both men worked for ArthurShow MoreRelatedThe Enron and Worldcom Scandals875 Words   |  4 PagesE. Boos – Week 2 – Assignment February 17, 2013 The Enron and WoldCom Scandals ENRON 1. The segment of Enron’s operations that got them into difficulties had several parts. They published misleading financial reports. They could not meet their bridge financing commitment with Barclay Bank because outside investors were not found. Because of this, they restated activities of JEDI and Chewco SPEs so they could be retroactively consolidated into Enron’s accounts. The SPEsRead MoreAccounting Scandals. ENRON, WORLDCOM1894 Words   |  8 PagesENRON Enron shocked the world from being â€Å"America’s most innovative company† to America s biggest corporate bankruptcy at its time. At its peak, Enron was America s seventh largest corporation. Enron gave the illusion that it was a steady company with good revenue but that was not the case, a large part of Enron’s profits were made of paper. This was made possible by masterfully designed accounting and morally questionable acts by traders and executives. Deep debt and surfacing information aboutRead MoreFinancial Scandals Of Enron, Worldcom, And Tyco Occurred Risk Management1671 Words   |  7 PagesRisk Management After the major financial scandals of Enron, WorldCom, and Tyco occurred risk management became a high priority for companies. According to Brown, Steen, and Foreman (2009) risk management can be defined as the culture, processes, and structures that are directed towards taking advantage of potential opportunities while managing potential adverse effects† (p.547). To assist companies in the risk management process, companies are incorporating a risk management system, this helpsRead MoreEnron and Worldcom Case Study1225 Words   |  5 PagesEnron and WorldCom Case Study This report is based on the demise of Enron Corporation and WorldCom. Both the firms are demised due to the ethical lapses. These ethical lapses come into existence when managements of the firm, uses unethical practices to accomplish the goals of the firm. Maintaining financial and accounting standards in the business practices are necessary. The profession of accounting has become a mockery due to the accounting scandals that took place all over the world in theRead MoreEssay on The Consequences of Bad Business Decisions1304 Words   |  6 PagesIn todays world business is very competitive. To compete with other companys executives have turned to corrupt practices. Once respected businesses like Enron, WorldCom, and Arthur Anderson have been found deceiving there customers, stockholders, and employees. C.E.O.s try to achieve the American dream and pursue capitalism to its fullest potential. In doing so, business leaders have lost their values and ethics, and make bad business decis ions. The downfalls of a company are the consequence ofRead MoreCorporate Scandals And The Implact Of The Sarbanes Oxley Act1472 Words   |  6 PagesA LOOK AT CORPORATE SCANDALS AND THE IMPLACT OF THE SARBANES-OXLEY ACT OF 2002 I. INTRODUCTION An economic boom filled with fraud, collapsed in the early 2000s with the unravelling of Enron in October 2001 followed by the implosion of WorldCom and many others big corporations. The downfall of these major companies led to a wide spread crisis of confidence in the financial markets. A crisis caused by executive greed was able to be magnified when the gatekeepers, the auditors, lawyers and analystsRead MoreThe Sarbanes Oxley Act Of 20021133 Words   |  5 Pagesdirectly affected by these scandals, many were indirectly affected as well due to the externalities caused by these greedy firms. The industry, for example, was to be untrusted. To try and instill trust back into customers, the Securities and Exchange Committee proposed and implemented a new law. This policy was put in place to regulate the accounting practices and to make them more honest. Titled the Sarbanes-Oxley Act of 2002 (enacted just after the WorldCom scandal), basically set rules and regulationsRead MoreCorpora te Scandals And Allegations Of Fraud1111 Words   |  5 PagesCorporate scandals and accusations of fraud have amplified intensely over the last decade. The cost of fraud has reached over $400 billion dollars a year, not to mention the loss of investments and jobs. Corporation fraud involves creative, complex methods in which to overstate revenues, understate expenses, over value assets, and underreport liabilities. To hide financial problems, management will manipulate stock prices, minimize taxable income, and maximize compensation. â€Å"It s been my experience†¦Read MoreThe Sarbanes Oxley Act Summary And Introduction1714 Words   |  7 PagesReforms have been created to close the gap of corporate governance and financial reporting in order to prevent the reoccurrence of corporate scandals. Congress created a federal bill named the Sarbanes-Oxley (SOX) Act in July 2002 in response to the Enron and WorldCom scandals that introduced major changes to the regulation of corporate governance and financial practice in order to protect the interest of investors and the public (â€Å"Sarbanes-Oxley Act Summary and Introduction,† 2003). The Act is extensiveRead MoreEthics : Ethical And Ethical Considerations1741 Words   |  7 Pagescompany. For small business investors, creditors and managers being ethical is a simple way of staying out of trouble, and is easier to distinguish between right and wrong. WorldCom was one of the biggest telecommunication company that our world h as seen and also had one of the largest accounting frauds in history. WorldCom was a company that did not stay ethical in their ways of doing business. In accounting, the ethical consideration is honesty. You want to help your client to pay as little

Fracking Is A Dangerous Process That Should Be Banned...

Hydraulic Fracturing (fracking) is the process of drilling into the ground and pumping sand, water, and fracking fluid at high pressures in order to extract natural shale gas that was previously unattainable. This process comes with environmental issues: the chemicals from the fracking fluid can contaminate nearby drinking water wells and harm the citizens of that area. Despite the fact that there have been several contaminated drinking water cases reported, there is little being done about this matter. This paper analyzes the available research that asserts why fracking is a dangerous process that should be banned immediately. The intended audience is my peers and instructor, as well as anyone interested in the debacle of fracking-caused water contamination that may come across this piece. As you are reading, I ask that you keep in mind that this is a very perplexing issue that has not been given much of an opportunity for true research and investigation. Therefore, the data discuss ed has not been officially proven or disproven to be directly related in every way to local fracking. However, the research gathered on the proposed danger of the Hydraulic Fracturing process is solely based on science that has already been proven as well as documented illnesses and symptoms from residents and contractors around or near fracking operation sites. Hydraulic Fracturing: This Dangerous Process Should Be Banned Immediately Hydraulic Fracturing (fracking) is the process of sand,

Anti Violence Essay free essay sample

Anti violence essay Seven years ago I did not think violence existed in America. The most violent act ever committed was the tragedy of the World Trade Center in 9/11/01. The Trade Centers had been the target for something so horrible, and I thought at the time, ‘This will change the world. † I was right about that fact: our airports are more secure, we have to have pass-ports anywhere you go now, you have more thorough bagage checks, and they’re more selective as to what’s in your purse before boarding a plane. I think the most secure place in America right now is our power plants. They have increased security at all our power plants, including the nuclear plants, and also there is air space around each plant so planes have to keep their distance from them. Homeland Security is a common word in our homes today because of 9/11. I wanted to know how. We will write a custom essay sample on Anti Violence Essay or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Wanted to know why. Wanted to know what our leaders reactions would be. The world trade center killed many people that my friends knew and loved; that can never be replaced. This act changed the way my friends lived, loved, and acted in school. This spine-chilling nightmare was committed because terrorists took over three planes that flew into the giant buildings. The causes of this violence is the hatred between countries, states, or nations. The hatred is then passed down to the youth generation, because we hear, and see the dislike between the grown-ups. Children learn from the wisdom and actions of what the elders do. Shooting, stabbing, verbal abuse, physical abuse, and gang fights are a few examples of youth violence. All of these exist in schools, neighborhoods, malls, the movies and even in your own home on the internet. Schools have tried to stop it but there is still a lot of verbal abuse anywhere in the school system you go. Youth violence can be stopped by reporting abuse, shooting, stabbings, and anything to do with gangs. It can also be solved by not being the one that does bulling or any of the things listed above. I think it is funny how teachers wonder about why no one reports violence in America. My say on the matter is the kids are scared it will only get worse if we tell a teacher or principal or any adult because they use our name and our grade to the bully or person that Bothers you.

Isaac Storm Essays - Galveston Bay Area, Greater Houston

Isaac Storm The Storm of 1900 On Friday evening, September 7, 1900, many of the 37,000 residents of Galveston, Texas, were settling down to dinner, few if any of them concerned about the steady 15 mph northerly wind rattling their windows. Within 48 hours, at least 8,000 of the townspeople would be dead, victims of the single worst natural disaster in U.S. history. Relatively few people are aware that the deadliest natural disaster in the United States was the hurricane that struck Galveston Island on September 8, 1900. One of the best resources that can be found to help fully understand the significance of this storm is Isaacs Storm: A Man, a Time, and the Deadliest Hurricane in History by Erik Larson. Dr. Isaac M. Cline was the chief of the U.S. weather Bureaus Galveston station located on the 3rd floor of the Levy Building which can still be found on the corner of Market and 23rd. Cline had begun tracking the storm from the Cape Verde Basin off the western coast of Africa. On August 31, this storm entered the Caribbean and began to increase in size. The hurricane passed just north of Cuba, and on Thursday September 6 entered the Gulf of Mexico. The projected course would have the storm make landfall well east of Galveston, but on Friday Dr. Cline became worried. Cline noticed a continually rising tide in spite of a 15 mph wind from out of the north as well as decreasing pressure. At 12 oclock midnight Saturday September 8, 1900 it began to rain in Galveston. By nine in the morning water was running calf deep Roberts 2 a few blocks from the beach. The rising tide, driving wind, rain and storm surge broke apart the bathhouses on the beach. Citizens of Galveston began to comprehend the importance of the situation and started moving toward the middle of the island along Broadway, only 8.7 feet above sea level at the time. Cline sent the final message from the island by telephone at 3:30 P.M. to the Western Union office in Houston. At five oclock the anemometer recorded winds of 102 mph before itself was carried away in a rush. Like that, the full fury of the storm was upon the island. Waters from the Gulf of Mexico and Galveston Bay quickly rose to meet each other, effectively swallowing the island. Throughout the night, the people of Galveston fought to survive. Buildings and homes began collapsing; blowing debris killed or maimed many people who managed to remain above the rising tide. Water poured through second story windows, forcing hundreds into the ocean where they were drowned or killed by wind driven debris. The tide reached 15 feet with breakers more that 25 feet. Many survivors, including Isaac, his three daughters and brother, spent the night clinging to the remains of their homes. By the morning, floodwaters had drained back into the sea. The corpses of people and animals lay intermingled through out the island; some were struck down in the street by debris, while others were crushed beneath their shelter or drowned. At least 6,000 to 7,000 Galveston resident were dead. Isaac survived along with his 3 daughters and younger brother Joe, but Isaacs wife Cora did not survive. Her body was found a few weeks later, identified by her engagement ring, which from then on Isaac wore. Roberts 3 High heat and humidity quickly settled over the city and made the stench from the thousands of dead humans and animals unbearable. Bodies were stacked on barges, weighted, and taken out to sea for burial. But in a morbid twist, the tides soon deposited the bodies back onto Galvestons beaches. After that, remains were buried in mass graves or cremated in bonfires. In 1900, the population of Galveston was 37,000. In one evening, it is estimated that 6,000 to 7,000 islanders lost their lives. Approximately, another 2,000 people in Galveston Bay area were killed. Not before or since have so many Americans perished in a disaster. By the next day the people of Galveston began rebuilding. Galveston constructed a seawall along the beach to protect the city from future storm surges. By 1905, the wall was 6 miles ling, 17 feet high and