Enron Scandal: Who is to Blame, And How Can it Be Prevented?

Jadeen Service

9/9/2015

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 After watching Enron: The Smartest Guys in the Room, it gave me a different perspective on the

whole scandal as a whole. At first I would normally just assume they were greedy (which they were) but

after viewing how the reporters displayed the facts and literal outbursts made my top management

some things may change. For instance, we were posed with the question who is to blame? I believe yes

top management is to blame because they took advantage of the slacks and loopholes they found in the

accounting system. When they found holes located in the financial system, they found ways of reporting

their financials in ways so that they could hide how bad they were doing financially and hide the fact that

they were offshoring company assets into personal accounts.

Their organizational culture and Kenneth Lay’s choices in employees allowed the scheme to go

on without anyone so much as saying a word because it was the most important people that were

involved. The employees trusted Kenneth Lay even though they knew something may be array in his

practices. Kenneth was also very seasoned in his knowledge of the accounting system which allowed him

to continuously cover his tracks for example, the individuals he hired. Another person to blame is Jeffery

Shillings who trained and conditioned the employees to act and say however they pleased. This “I’m

above everyone else” attitude made them feel as if they were untouchable. This all could have been

prevented if the employees were checked by management that weren’t committing shady practices

themselves. The auditing company that found these errors,

This study source was downloaded by 100000839033514 from CourseHero.com on 12-30-2021 11:33:12 GMT -06:00

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