Granting stock options (the right to purchase shares of the employer's stock at a predetermined price) is a way to pay employees. ... Suppose that a company sells stock outright to an employee. ... Should the stock value increase a thousand fold, the public will envy the investment acumen and perceptivity of investor "X" (Bill Gates for example), but no one will denounce him on account of his stockholder profits as an "overpaid CEO". ... What actually was done, was that a bank or other investor lent money to the newly created company to finance the purchase. ... The asset was rarely a...

• Word Count: 2143
• Approx Pages: 9
• Has Bibliography
• Grade Level: High School

Enron investors did not follow the three cardinal rules for investing. (1) Know your investments: Two of the nations most respected financial investors, Warren Buffet and Peter Lynch, have long recommended that people invest only in companies they know and understand. (2) Understand investment risk and how you handle risk: Enron was a risky company. ... They had too much money invested in their employers stock. ... A firm may stretch the rules if they are a high investor. ... Employees can invest in their companies stock but it should be only a small part of their portfolio. ... Organizations ...

• Word Count: 1893
• Approx Pages: 8
• Grade Level: Undergraduate

Having a common standard of financial reporting that is familiar with many other businesses makes it easier for investors to compare different business entities. This ease in comparison is helpful especially when the investors do not have the luxury of time, for example, when there are fluctuations or intense speculations in the stock markets and they need to make split second decisions. ... The stock exchange market also stands to gain from a harmonization of international accounting standards (Jeno 2011, p.29). Usually, there are certain conditions that different stock markets set in order f...

• Word Count: 1396
• Approx Pages: 6
• Grade Level: Undergraduate

People lost millions of dollars due to the drop in stock and were in disbelief. ... They were treated well, and the company matched employee pension contribution with Enron Stock. ... Enron employees built up their retirement plan based on their Enron stock holdings. ... The employees and investors were repeatedly lied to by Enron executives, who knew that Enron was going down but desperately tried to boost up Enron's stock prices by convincing employees to keep their shares. ... They even encouraged employees to purchase more stock. ...

• Word Count: 1298
• Approx Pages: 5

They were also designed to help the company grow quickly without adding too much debt to its books or diluting the value of the company's stock. ... Enron said it was careful to assure there were no conflicts of interest, but under pressure from investors Fastow resigned from those partnerships last summer. But before his resignation he had earned as much as $30 million through his role with the partnerships, while a number of other Enron employees also invested in them personally." ... Once money, which meant Enron Stock Price, became the most important thing; ethics, morals and the fin...

• Word Count: 1277
• Approx Pages: 5
• Has Bibliography
• Grade Level: Undergraduate

They were also designed to help the company grow quickly without adding too much debt to its books or diluting the value of the company's stock. ... Enron said it was careful to assure there were no conflicts of interest, but under pressure from investors Fastow resigned from those partnerships last summer. But before his resignation he had earned as much as $30 million through his role with the partnerships, while a number of other Enron employees also invested in them personally." ... Once money, which meant Enron Stock Price, became the most important thing; ethics, morals and the fin...

• Word Count: 1262
• Approx Pages: 5
• Has Bibliography
• Grade Level: Undergraduate

It also prevents a CEO from selling stock during "black out periods" (Hecht) Prior to the Sarbanes-Oxley Act of 2002 being signed there were a number of accounting fraud every year. ... It wasn't until 2001 when Enron's stock started to deflate. ... The deal collapsed and Enron's crediting rating and stock dropped. ... It was created to "oversee the auditors of public companies in order to proctect the intrestes of investors and further the public interest of investors and further the public intrest in the preparation of informative, fair, and independent audit reports"(pcao...

• Word Count: 1259
• Approx Pages: 5
• Grade Level: High School

It also prevents a CEO from selling stock during "black out periods" (Hecht) Prior to the Sarbanes-Oxley Act of 2002 being signed there were a number of accounting fraud every year. ... It wasn't until 2001 when Enron's stock started to deflate. ... The deal collapsed and Enron's crediting rating and stock dropped. ... It was created to "oversee the auditors of public companies in order to proctect the intrestes of investors and further the public interest of investors and further the public intrest in the preparation of informative, fair, and independent audit reports"(pcao...

• Word Count: 1305
• Approx Pages: 5
• Has Bibliography
• Grade Level: High School

People were affected by loss of jobs, loss of pension savings, and individual investors who owned stock in the company lost significant losses as well. ... "Were Enron's partnerships with shell corporations designed to hide its liabilities and mislead investor's?" ... "Did Enron executives know the company was sinking as they sold $1.1 billion in stock while encouraging employees and other investors to keep buying stock?" ... Unfortunately, "key Enron executives were selling stock shortly before the company announced a restatement of earnings."... If an executive transferred stock to...

• Word Count: 1972
• Approx Pages: 8
• Grade Level: Undergraduate

Also Andy Fostow shouldn't have accepted to create companies to boost Enron and as a senior most executive the first right of way for him should have been to maximize values to shareholders instead of self creating entities and convince the investors to invest towards them which eventually will hit Enron in the longer run. ... The powerful media, congress and the other companies questioned Enron for its own way and eventually there was a stock decline from the similar companies. ... This law was also designed to give the accurate number to the investors and the disclosures of the corpora...

• Word Count: 1320
• Approx Pages: 5
• Has Bibliography
• Grade Level: Undergraduate

The main purpose of the act is to protect shareholders from deceitful financial statements put out by companies and to reconstruct the faith of investors. If for any reason shareholders decide the financial declarations business put out, the value of the U.S stock exchange will and has gone down. ... A way that investors knew for a fact that they were not getting deceived, was that this act required an independent third party to verify the accuracy of the companies financial statements. ... Once business found they could not manage this agonizing process, they felt forced to either move their...

• Word Count: 1466
• Approx Pages: 6
• Has Bibliography
• Grade Level: High School

Their stock symbol in ENRNQ and their revenues in 2000 were $101 billion. ... An Enron shareholder suit claims that former Enron Chairman Kenneth lay sold $184.5 million in stock, Chief Executive Officer Jeffrey Skilling sold $70.7 million and Richard Causey sold 134.4 million dollars. ... Enron's top executives made a reported $1.1 billion by selling Enron stock between October 1998 and November 2001. Enron employees received Enron stock in their retirement accounts, but were prevented from selling it - with the exception of top em...

• Word Count: 1674
• Approx Pages: 7
• Grade Level: High School

However, Tyco is still under review and remains a risky stock in which to invest monies. ... After losses close to $400 million in one year, I would not be putting any of my money in Tyco's stock; regardless of whether they are recovering or not. ...

• Word Count: 1676
• Approx Pages: 7
• Has Bibliography
• Grade Level: High School

The abrupt resignation of CEO Jeffrey Skilling, citing "entirely personal reasons" for his decision was to sow the seed of doubt in the shareholders" minds, and the stock price began to slide. ... It was also forced to knock $1.2bn off shareholder equity at the time, a move that led to a crisis in investor confidence and a collapse in Enron's share price precipitated by a credit rating downgrade, which was almost certainly the last straw. ...

• Word Count: 1302
• Approx Pages: 5
• Grade Level: Undergraduate

There has not really been any substantial evidence presenting that the stock market has become further dependable over the past 10 years since the Sarbanes-Oxley Act of 2002. ... Most people with good sense will always choose to invest their money in organizations who are legit and trustworthy, and is on top of their game as far as preventing fraud and brining security, and confidence throughout the organization....

• Word Count: 1379
• Approx Pages: 6
• Has Bibliography
• Grade Level: Undergraduate

Blueprints of Ethics Due to the Enron scandal, countless individuals lost life savings because of the unethical decisions made by the executives of the company. In this case, the executives greedily hoarded millions of dollars for their own pensions and retirements funds, while allowing inside in...

• Word Count: 1771
• Approx Pages: 7
• Grade Level: Undergraduate