An Extended Case Study Jim Rothwell Assistant Professor of Accounting Hickingbotham School of Business Ouachita Baptist University The Crooked E Coincidence or Prophecy JAMES NIELSENAFP Questions ID: 196053
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Slide1
Enron: An Extended Case Study
Jim Rothwell
Assistant Professor of Accounting
Hickingbotham School of Business Ouachita Baptist UniversitySlide2
The Crooked E: Coincidence or Prophecy ?
JAMES NIELSEN/AFPSlide3
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?Slide4
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.Slide5
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 QuestionsSlide6
Accounting and Auditing Issues and Concepts (Cont.)
Accounting
Mark-to market
SPEs (off-balance sheet financing)
Impact on the profession
Government interventionSlide7
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 documentationSlide8
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
Slide9
Current StatusEnron
Legal issues and court cases
Former executives
Employees
Arthur AndersenSlide10
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.