Most people usually work from rags to riches, but this is not the case with the Enron scandal. In 1985 Ken Lay created Enron by combining two natural gas companies. In the early 1990s, it contributed to the sale of electricity at regular market prices. Following this first act, the American Congress approved deregulation in the sale of natural gas. This allowed Enron to sell energy at higher costs, increasing its profits. Once this plan was established, Enron was on its way to becoming the largest seller of natural gas in North America. In 1992, contracts earned $122 million, only the second largest contributor to the company's net income. Seven years later, in 1999, Enron became accessible online as a trading website allowing the company to more efficiently manage its contracts. In this case the entire company has turned the common saying “from rags to riches” on its head, these people have gone “from riches to rags”. Since the 1990s Enron stock increased 311% by the end of the year in 1998. In 1999 the increase was only 56% and another 87% in 2000. At the end of the year, in 2000 , the final share price was $83.13 and the capitalization exceeded $60 billion, almost six times the book value. Enron was then ranked America's most innovative large company in Fortune's Most Admired Companies survey. From the movie Enron: The Smartest Guys in the Room, it only took 24 days for the company to completely fail. There were several factors that caused Enron's downfall. The company's complex financial records were confusing to shareholders and analysts. The complexity of the business model and unethical practices required the use of accounting limitations to misrepresent earned income and manipulate… middle of paper… causing the company's demise in Fastow. Lay was convicted of all 6 counts of securities fraud and subject to a maximum sentence of 45 years in prison. However, before sentencing, Lay died. After a few simple mistakes and greedy hands, this company managed to fall from rags to riches. Later in life they may realize what they have done and make changes in their life. Never get too greedy or you might fail too, it doesn't take much. Enron was a thriving, successful company in our oil industry and they lost everything. Works Cited Enron: The Smartest Guys in the Room. Director Alex Gibney. Perf. Tim Belden John Barba. 2005. Netflix.Lashinsky, Adam. The Enron scandal. November 30, 2001. April 1, 2014.Leaders, paper edition. "The real scandal." January 17, 2002. The Economist. April 1, 2014.Silverstein, Ken. "Enron, ethics and corporate values today". FORBES May 14 2013.
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