The downfall of Enron, one of the most biggest corporate scandals in American

history. It's challenging to identify a single fundamental cause because several interconnected
problems had a big impact. Starting with the Vahalla Scandal Kenny Boy continues to make
quick money with Jeffrey Skilling.
Firstly, Enron adopted a "mark-to-market" accounting method to make unlimited
money, which allowed the company to estimate the future profits of long-term contracts
immediately, rather than overtime. This method was used to overstate earnings and project
continuous profitability. Secondly, Enron participated in extensive financial statement
manipulation and accounting fraud. They hide debt and inflated profits using off-balance-
sheet special purpose companies (SPEs). The company's financial condition appeared to be
considerably healthier than it was because of this dishonest accounting. Even executives from
Enron, such as CEO Jeffrey Skilling and CFO Andrew Fastow, engaged in insider trading by
reselling their own business shares while urging investors to invest in it. Also, Enron's
financial transactions were exceedingly intricate and mysterious. Even some employees and
shareholders didn't fully comprehend the company's genuine financial situation. The absence
of transparency made it difficult for stakeholders to make wise choices.
Enron's collapse was caused mainly by the use of dishonest accounting practices and a
lack of transparency. These strategies initially seemed to indicate financial stability and
development but ultimately failed, leading to the company's downfall.