The mission of the Financial Accounting Standards Board (FASB) is to establish and improve standards of financial accounting and reporting for the guidance and education of the public. Accounting standards assist analysts, potential investors, and corporate figures in determining and comparing the financial performance of a corporation. In recent years, a wave of accounting scandals broke, and a number of companies admitted to following fraudulent accounting procedures to defer attention from the company's financial performance. Enron Corporation, a natural gas provider, led the pack with dubious accounting practices, a series of off-balance sheet transactions, and a series of investigations that ultimately led to beginning of accounting reform.
The Beginning of the End of Enron
Enron Corporation, an energy and communications company was established in 1985 by the merger of Houston Natural Gas and InterNorth (enron.com). This merger catapulted Enron into becoming the largest natural-gas company in America. Fortune magazine named Enron "America's Most Innovative Company" in the years of 1996 to 2000. And in 2000, Enron was Fortune's "100 Best Companies to Work for in America." In 1986, Enron's CEO, Kenneth Lay, proclaimed that the vision of Enron is to become "the premiere natural-gas pipeline in North America" (enron.com). However, this vision of Enron would ultimately lead to the most scandalous fall of a business lead by corporate greed.
Enron continued its meteoric rise to becoming the world's leading Energy Company. In 1989, Enron formed a trading company, Gas Bank, run by CEO Jeffrey Skilling, and within a year Gas Bank became Enron Finance Corporation and En ...