Question

1. Company Background (mission, vision, culture, product and awards etc.)

2. Describe the Sarbanes Oxley

3. Discuss the scandal: What happened, Main Players, How it was executed, How they got caught, penalties and additional information

4. Analyze how this scandal could have been prevented.

5. Define Ethics, morals and business ethics. Explain how at least 2-3 ethical principles were violated. (see slide presentation) Discuss the ethics surrounding the case, who may be affected and were the penalties sufficient based on your perspective.

6. Provide a conclusion of what you learnt from the assignment, include recommendations or highlights that would be beneficial to the corporation.

Answer 1

Answer are as under

( Note the above answer are given by assuming that you did ask question about Enron corporation )

1) Company Background (mission, vision, culture, product and awards etc.)

Enron corporation

Enron Corporation is created from the merger of Houston Natural Gas and InterNorth. Company has its headquarters to Houston,It was into natural gas and oil pipeline company. Enron's motto was "Respect, Integrity, Communication and Excellence. Eron started overseas and state expansion on higher ground and to survive the expansion there were many irregular practices followed by companies top management. company also started hedging of its products. It could have been at present top company of the world if a accounting scandal could not be known in the year 2001

Companies Vision and mission statement were , " We treat other as we want to get treated our self." They don’t tolerate bad and wrong treatment.

Its products were mainly of natural gas, oil, power, energy, LNG, broadband, Paper, steel ,water and many more

2. Describe the Sarbanes Oxley

Sarbanes Oxley Act 2002 is created to stop the corporate world fraud. It is there to protect the whistleblowers,investors , to bring transparency in the entities , to strengthens the independence and financial position of the corporates. There are set of rules and regulation set by the board. The law was made specifically for Public listed company but it grabs the non profit making entitles also

During the beinging of year 2001 to 2002 , various co corporate frauds were identified in the companies like Enron, Tyco etc. Big frauds were found in term of loss of monetary interest and loss of public trust. To prevent all such fraud and enhance the transparency in financial conduct of the corporate the Act was introduced. It basically introduce to protect the interest of all interested stakeholder in the company. It is mainly to protects the shareholder interest, employees and public from the fraudulent financial activity. Due to big fraud of Enron Corp. public , employees and investor loss the trust as there were many fraudulent activity was conducted by the firm. They conducted the fraudulent financial activity due to the unethical behaviour of management and due to there personal benefit. Conflict of interest were observed between conduct of work.

3. Discuss the scandal: What happened, Main Players, How it was executed, How they got caught, penalties and additional information

Scandal / Fraud

It scandal was the main reason behind the fall of the company. Companies financial statement were prepare on wrong basis and many fraudlent activity were conducted by the company which doesnot show true and fair view to various stake holder and the same were misleading.Company followed the unethical business practice due to which company was required to misrepresent its earning per share and maniuplated the financial figure to show good position. Eron corporation was declared bankrupt in the year 2001

The main person behind the fraud were :

1) CEO Jeff Skilling,

2) CFO Andrew Fastow

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