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Enron: An Extended Case Study

This document outlines an extended case study on Enron and provides questions and activities for students. It discusses the major events and players in the Enron scandal, accounting issues like special purpose entities and mark-to-market accounting, the role of Arthur Andersen, and lessons learned. Students are encouraged to research Enron's financials from 1995-2002, create a timeline of key events, identify red flags, and examine the impact on the accounting profession. The document also lists resources like books and films for further information.

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82 views

Enron: An Extended Case Study

This document outlines an extended case study on Enron and provides questions and activities for students. It discusses the major events and players in the Enron scandal, accounting issues like special purpose entities and mark-to-market accounting, the role of Arthur Andersen, and lessons learned. Students are encouraged to research Enron's financials from 1995-2002, create a timeline of key events, identify red flags, and examine the impact on the accounting profession. The document also lists resources like books and films for further information.

Uploaded by

ehsan.amimul3795
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Enron: An Extended

Case Study

Jim Rothwell
Assistant Professor of Accounting
Hickingbotham School of Business
Ouachita Baptist University
The Crooked E: Coincidence or
Prophecy ?

JAMES NIELSEN/AFP
Questions ?
• What happened within the company?
• What was the corporate environment and culture of
the company?
• Who were the major players and their roles?
• What “red flags” were there for analysts, auditors,
and others to observe?
• What accounting and auditing issues arose within the
company?
• How did the Enron scandal impact the accounting
profession?
• What did we learn from Enron?
Activities
• View the movie “The Smartest Guys in the Room.”
• View the movie “The Crooked E: The Unshredded Truth about
Enron.”
• Read the book “The Smartest Guys in the Room.”
• Read the book “Anatomy of Greed.”
• Research the financial statements of Enron from 1995-2002
• Create a timeline of the major events related to Enron from
1995-2002
• Create a list of the major players and their roles in the Enron
scandal and collapse.
• Identify the “red flags” of fraud that were evident within the
Enron organization, culture, structure, and environment.
Enron Portfolio
• Major events timeline
• List of major players and roles
• Financial statement analysis and summary
• “Red Flags” paper
• Impact on the accounting profession paper
▫ Role of Arthur Andersen
• “What Did We Learn?” paper (personal
reflection)
• Enron Quiz Questions
Accounting and Auditing Issues and
Concepts (Cont.)

• Accounting
▫ Mark-to market
▫ SPEs (off-balance sheet financing)
▫ Impact on the profession
▫ Government intervention
Accounting and Auditing Issues and
Concepts (Cont.)
• Auditing
▫ Impact on the profession
▫ Collapse of Arthur Andersen
▫ Sarbanes- Oxley
▫ PCAOB
▫ Ethics
 Accounting firm
 Client
▫ Legal Liability
▫ Social Responsibility
▫ Evidence and documentation
Accounting and Auditing Issues and
Concepts (Cont.)
• Auditing
▫ Social Responsibility
▫ Evidence and documentation
▫ Audit Planning
 Understanding the client – corporate culture
 Understanding the industry/market
 Risk assessment
 Fraud risk factors
▫ Internal Control
▫ Reporting Issues
Current Status
• Enron
▫ Legal issues and court cases
▫ Former executives
▫ Employees
• Arthur Andersen
Resources
• “The Smartest Guys in the Room” – DVD (video)
• The Smartest Guys in the Room: The Amazing Rise
and the Scandalous Fall of Enron– Book (McLean
and Elkind)
• “The Crooked E: The Unshredded Truth about
Enron” – DVD (video)
• Anatomy of Greed – Book (Cruver)
• SAS 99: Consideration of Fraud in a Financial
Statement Audit
• Other articles, presentations, literature, etc.

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