Romello Weakley
ENG 112 DO3
McKinley
December 9, 2014
Ethics in the Accounting Workplace
In today's world of business, a company will not be able to function properly unless its employees are able to accurately and effectively complete his or her job duties. A company can have a product or service that people need for their everyday life; however, if a company is not able to depend on its employees to complete their job ethically, the company as a whole will fail at being successful. In business, ethics is a huge factor in determining the success of a company. Ethics is the study of values and customs of a person or group and covers the analysis and employment of concepts such as right and wrong, good and evil, and responsibility (Merriam-Webster, …show more content…
Enron Corporation was previously known for being one of the world's leading electricity, natural gas and communications companies but will now always be known for accounting fraud and corruption. The company reported inflated estimates of income and did not report all debts that the company owed. In 2001, Enron Corporation filed for bankruptcy, which led to criminal investigations of money laundering, insider trading and fraud involving top executives. Although top level executives at Enron were likely aware of the debt and the illegal practices, the fraud was not revealed to the public until October 2001 when Enron announced that the company was actually worth $1.2 billion less than previously reported (SecuritiesFraudFYI.com, 2006). When this information was revealed, investors, creditors and stockholders knew something was amiss. This behavior would have continued had it not been for one whistleblower that recognized the unethical behavior that was taking place. Sherron Watkins (Thomas, 2006), Vice President for Corporate Development, wrote a memo to her boss, Kenneth Lay, stating "and there are probably one or two disgruntled 'redeployed' employees who know enough about the 'funny' accounting to get us in trouble." The memo was later released to Congress as evidence. Under these circumstances, it is unclear how long the company would have been able to
ENG 112 DO3
McKinley
December 9, 2014
Ethics in the Accounting Workplace
In today's world of business, a company will not be able to function properly unless its employees are able to accurately and effectively complete his or her job duties. A company can have a product or service that people need for their everyday life; however, if a company is not able to depend on its employees to complete their job ethically, the company as a whole will fail at being successful. In business, ethics is a huge factor in determining the success of a company. Ethics is the study of values and customs of a person or group and covers the analysis and employment of concepts such as right and wrong, good and evil, and responsibility (Merriam-Webster, …show more content…
Enron Corporation was previously known for being one of the world's leading electricity, natural gas and communications companies but will now always be known for accounting fraud and corruption. The company reported inflated estimates of income and did not report all debts that the company owed. In 2001, Enron Corporation filed for bankruptcy, which led to criminal investigations of money laundering, insider trading and fraud involving top executives. Although top level executives at Enron were likely aware of the debt and the illegal practices, the fraud was not revealed to the public until October 2001 when Enron announced that the company was actually worth $1.2 billion less than previously reported (SecuritiesFraudFYI.com, 2006). When this information was revealed, investors, creditors and stockholders knew something was amiss. This behavior would have continued had it not been for one whistleblower that recognized the unethical behavior that was taking place. Sherron Watkins (Thomas, 2006), Vice President for Corporate Development, wrote a memo to her boss, Kenneth Lay, stating "and there are probably one or two disgruntled 'redeployed' employees who know enough about the 'funny' accounting to get us in trouble." The memo was later released to Congress as evidence. Under these circumstances, it is unclear how long the company would have been able to