Exam (elaborations) MANAGEMENT 482 (BUSI 472-ENRON CASE

Exam (elaborations) MANAGEMENT 482 (BUSI 472-ENRON CASE:@In October 2001, U.S. energy giant Enron shocked investors by disclosing that it lost $638 million dollars in a single quarter. Two months later, the Wall Street darling and seventh largest company in the United States declared bankruptcy, causing shares to plummet from $85 to less than $1. The collapse left investors and pension-holders penniless. The fraudulent accounting that concealed Enron's financial woes led to the criminal prosecutions of CEO Jeffrey Skilling and Chairman Kenneth Lay, wellknown industry leaders who were convicted of fraud, conspiracy, and insider trading. In the course of its investigation, the U.S. Congress uncovered multiple organizational breakdowns at Enron—in particular, a lax ethical culture and collusion by Big Five accounting partner Arthur Andersen—that enabled the fraud to continue for yearsWhat was the cause of Enron's overnight collapse? a.The criminal conviction of CEO Jeffrey Skilling b.The extraordinary size of the company c.The rapid growth of the company d.Formerly undisclosed financial lossesWhich of the following topics helps explain the organizational factors behind the Enron scandal? a.Personal ethics b.Diversity c.Corporate culture d.Consumer fraud