Skilling Watkins Served As The Whistle Blower Essay

Sherron Watkins served as the â€Å"whistle-blower† who played a major part in bringing down the Enron Corporation. Watkins had joined Enron in 1993, after leaving Arthur Anderson. (Enron Whistle) She managed Enron’s massive portfolio of investments used in its multiple vehicles (Welcome). In her letter to then-CEO Kenneth Lay, Watkins questioned whether Enron could withstand the scrutiny of an SEC investigation. Not only would Jeffrey Skilling’s abrupt departure trigger such an investigation, but also questions about Enron’s accounting practices and its valuation of its assets would also come to the fore. Watkins was particularly concerned with the Raptor transactions. She warned Lay that Enron’s stock would have to be liquidity to â€Å"fix the Raptor and Condor deals;† the SEC, as well as the public, would be sure to ask uncomfortable questions (Text). Stock that was supposed to be swapped for Raptor had lost so much value that Enro n stock would have to be use to cover the difference. Watkins foretold that the company would â€Å"implode in a wave of accounting scandals† (Text). She knew that Enron stock had been reported to be much more valuable than it actually was. She knew that investors that had paid seventy to eighty dollars per share were expending that stock to be worth around $120 per share; unfortunately, it was worth less than forty dollars per share (Text). Watkins went on in the letter to cover a number of salient points supporting her questions. Lay alertedShow MoreRelatedThe Ethics Of Enron Oxley Act1309 Words   |  6 Pagescreated from the joining of gas pipeline companies in 1985 and was responsible for natural gas, electricity, and communication products and services (Ferrell, et al, p.318). During the 1990’s, Chairman Kenneth Lay, chief executive officer (CEO) Jeffrey Skilling, and chief financial officer (CFO) Andrew Fastow grew the company into a multi-billion dollar o peration. The primary income was derived from energy sales and the remainder was generated in other offerings. The product transactions daily were significantRead MoreEnron: from the Beginning to the End2542 Words   |  11 Pagesnamed former Houston Natural Gas CEO Kenneth Lay as CEO of the newly merged company, and soon moved Enron s headquarters to Houston, Texas. After becoming the newly created top executive, Lay later became chairman of the board and hired Jeffrey Skilling as Chief Executive Officer. Under their leadership, Enron adopted an aggressive growth strategy. Andrew Fastow, Enron’s Chief Financial Officer, helped create the complex financial structure for the new Enron. (Reinstein, et all, 2002) ProductsRead MoreEnron Case7190 Words   |  29 Pagesshift debt and losses off of the books would soon fail. In August of 2001, the now infamous internal whistle blower Sherron Watkins, formerly the Enron Vice President for corporate development, sent an 1 www.washingtonpost.com/wp-srv/business/enron/front.html ENRON Page 5 of 27 email to Kenneth Lay, warning him that Enron would â€Å"implode in a wave of accounting scandals †. CEO Jeffrey Skilling suddenly resigns, two months after the memo was sent to Lay. Enron, with the help of the AndersenRead MoreEnron And The Enron Company1502 Words   |  7 Pagesbackdated on August 3rd when SPEs stock price hit $160 a share and booked a $75 million gain, which delivered accounting benefits to Enron from complex and deceptive swap transaction, while SPEs specialist and accomplices, according to Swartz and Watkins (2003: 310), earned $58.9 (p.1221). Giroux (2008) research found that the Enron executives make certain that its quarterly earnings forecast are met due to their compensation package includes stock options, which stipulates that it is only vestedRead MoreCase Study: Accounting for Enron4415 Words   |  18 Pagesand Kinder controlling leadership style fostered a cutthroat work environment. However, Enron’s culture would undergo a more detrimental change under Jeff Skilling’s reign as President and CEO from 1996-2002. Skilling embodied a very different and high risk taking management style. Skilling brought a corporate culture to Enron that was Darwinian to the point of near absurdity. From Fox’s book on Enron (Fox, 2003), Skilling’s survival of the fittest tactics were reflected in his policies for performanceRead MoreThe Ethics Of The Enron Corporation1908 Words   |  8 PagesEnron’s case is Jeffrey Skilling. He was the president COO, and also served as CEO from Feb. to Aug. 200 1. While acting as CEo he continued to run the company exactly the same way. In August 14, 2001, he left the company without disclosing any financial problems of Enron. He just said that he wanted to spend more time with his family. However, he sold over $200 million shares on September 2011. Before his departure, he also did many things which seem unethical. Skilling would provide Analyst his