1. The history of Enron
Prior t its bankruptcy, Enron was one the leading natural gas and electricity companies globally. The corporation also dealt with marketing of natural gas liquids as well as operating one of the leading gas transmission systems globally while also leading other development projects in industrial and emerging markets electricity supplier.
The company originated in Omaha, Nebraska USA and was originally known as Northern Natural Gas Company being a merger of three companies; Lone Star Gas Corporation which took thirty percent in the new merger, United Light & Railways Company with thirty five percent and North American Light & Power Company with the rest thirty five percent. This merger happened only a few months to the stock crash of that happened in 1929. The coining of this corporation later became suspect because this was in the era of the infamous great depression. Nevertheless, the great depression worked many ways in favor of Northern Natural Gas Company because natural became the next big thing in heating as a result of its competitive pricing. With its formation also came the invention of steel pipes with a high gas carrying capacity. Another high point was availability of cheap labor taking advantage of the many workers laid off due to the great depression in the construction of its pipelines. With the above factors at its disposal, the company grew in folds with many acquisitions in the mid half of the 21st century to be a world leader in energy. To the close of the first half of the 21st century, the company sold thirty percent owned by Lone Star Gas Corporation and later another bulk of the shares sold to the public five years later. Fast forward to the mid 80s, the company was renamed a previously merged name, HNG/InterNorth to Enron Corp with its headquarters moving from Omaha, Nebraska to Houston, Texas. During this time Kenneth Lay was the chairman. During this time, thins were not so favoring for the company and it sold off many subsidiaries. In the 1990s, the corporation started to register new growth after a previous decline resulting from a decline in natural gas prices. New markets were also gained in the electricity sector and the liberalization of the utilities market by the federal government which the company projected would increase its sales out of the huge capital base which would oversee its distribution. It was also in this period that it has mega projects many of them in South America and Asia. Ten years later, Enron was registering growth and new ventures such as broadband services which was fronted by Enron Online a subsidiary of Enron. During the rise on broadband business, the company was ranked the sixth biggest energy corporation in the world. However, it was in the beginning of the same decade that cracks began to emerge with a net loss of close to six hundred and twenty thousand dollars reported in 2001. Toward the close of the same year, Enron applied for bankruptcy protection and close to six thousand workers were laid off. In the midst of this turmoil, the stocks plummeted to less than $1 with investors losing billions of …show more content…
The Purpose of the legislation signed by President Bush
With the biggest financial scandal, Enron’s financial controversy came at a time when the economic recession was taking shape and it can be said that Enron was a major contributor to the stock market collapse. The investigations into its financial reporting created a new resolve to protect investors against corporate fraud. It calls for a combination of ethical and moral standards should be employed in all accounting work in order to safeguard shareholders interests.
The financial scandal came tearing down the big wigs in the government including former president George bush who had received handsome contributions in building his political career. Also not spared was the attorney general john Ashcroft. This created even more controversy with debates on the influence of money in the political system. When the white house was requested for the disclosure of documents relating to the president’s appointment of the task force on energy then chaired by Dick Cheney, the former vice president, they did not
Prior t its bankruptcy, Enron was one the leading natural gas and electricity companies globally. The corporation also dealt with marketing of natural gas liquids as well as operating one of the leading gas transmission systems globally while also leading other development projects in industrial and emerging markets electricity supplier.
The company originated in Omaha, Nebraska USA and was originally known as Northern Natural Gas Company being a merger of three companies; Lone Star Gas Corporation which took thirty percent in the new merger, United Light & Railways Company with thirty five percent and North American Light & Power Company with the rest thirty five percent. This merger happened only a few months to the stock crash of that happened in 1929. The coining of this corporation later became suspect because this was in the era of the infamous great depression. Nevertheless, the great depression worked many ways in favor of Northern Natural Gas Company because natural became the next big thing in heating as a result of its competitive pricing. With its formation also came the invention of steel pipes with a high gas carrying capacity. Another high point was availability of cheap labor taking advantage of the many workers laid off due to the great depression in the construction of its pipelines. With the above factors at its disposal, the company grew in folds with many acquisitions in the mid half of the 21st century to be a world leader in energy. To the close of the first half of the 21st century, the company sold thirty percent owned by Lone Star Gas Corporation and later another bulk of the shares sold to the public five years later. Fast forward to the mid 80s, the company was renamed a previously merged name, HNG/InterNorth to Enron Corp with its headquarters moving from Omaha, Nebraska to Houston, Texas. During this time Kenneth Lay was the chairman. During this time, thins were not so favoring for the company and it sold off many subsidiaries. In the 1990s, the corporation started to register new growth after a previous decline resulting from a decline in natural gas prices. New markets were also gained in the electricity sector and the liberalization of the utilities market by the federal government which the company projected would increase its sales out of the huge capital base which would oversee its distribution. It was also in this period that it has mega projects many of them in South America and Asia. Ten years later, Enron was registering growth and new ventures such as broadband services which was fronted by Enron Online a subsidiary of Enron. During the rise on broadband business, the company was ranked the sixth biggest energy corporation in the world. However, it was in the beginning of the same decade that cracks began to emerge with a net loss of close to six hundred and twenty thousand dollars reported in 2001. Toward the close of the same year, Enron applied for bankruptcy protection and close to six thousand workers were laid off. In the midst of this turmoil, the stocks plummeted to less than $1 with investors losing billions of …show more content…
The Purpose of the legislation signed by President Bush
With the biggest financial scandal, Enron’s financial controversy came at a time when the economic recession was taking shape and it can be said that Enron was a major contributor to the stock market collapse. The investigations into its financial reporting created a new resolve to protect investors against corporate fraud. It calls for a combination of ethical and moral standards should be employed in all accounting work in order to safeguard shareholders interests.
The financial scandal came tearing down the big wigs in the government including former president George bush who had received handsome contributions in building his political career. Also not spared was the attorney general john Ashcroft. This created even more controversy with debates on the influence of money in the political system. When the white house was requested for the disclosure of documents relating to the president’s appointment of the task force on energy then chaired by Dick Cheney, the former vice president, they did not