Enron

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Enron shocked the world from being one of America’s largest corporations to being the biggest corporate bankruptcy at its time. 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. It not only bankrupted the company but also destroyed Arthur Andersen, one of the largest audit firms in the world. In addition to being the largest bankruptcy reorganization in American history at that time, Enron was attributed as the biggest audit failure.

        Upon reading articles about Enron’s downfall, I had the feeling of disappointment knowing how greedy the Enron senior members were just thinking all about their self-interests- that is, to earn as much for themselves as possible. Showing wrong figures to show that the company is profitable to increase the stock value and let the shareholders invest more with Enron is a big deceive while in fact, the company was not doing well. Enron’s best interest was on how it can cheat more people to gain more money from their investments.  I am much more saddened by the fact that this fraud and negligence was assisted by the company’s auditors and consultants, Arthur Andersen. As an independent entity, Andersen was expected to fulfill its professional responsibilities in connection with its audits of Enron's financial statements, but it failed to do so. Good thing was that the anomaly and deception was not until late 2001 and that both the companies got themselves into a load of trouble. It was quite depressing, however, that many employees have lost their jobs because the firms were put out of business. Investors also have lost billions of dollars as Enron's stock has plummeted to penny-stock levels. Nevertheless, I am pleased to know that the scandal has brought changes that are actually positive- that is, leaving the accounting industry and the economy much stronger. It eventually brought about improved and stricter standards to follow that restored public’s confidence in auditors and businesses.