trust and fair representatioon of financial information are important this is lessons learned from Enron?

Question

explan it?

Answer 1

There are many causes of the Enron collapse. Among them are the conflict of interest between the two roles played by Arthur Andersen, as auditor but also as consultant to Enron; the lack of attention shown by members of the Enron board of directors to the off-books financial entities with which Enron did business; and the lack of truthfulness by management about the health of the company and its business operations. In some ways, the culture of Enron was the primary cause of the collapse. The senior executives believed Enron had to be the best at everything it did and that they had to protect their reputations and their compensation as the most successful executives in the U.S. When some of their business and trading ventures began to perform poorly, they tried to cover up their own failures.

Can You Trust Anybody Anymore?
The scope of the Enron debacle undermines the credibility of modern business culture. Investor confidence is crucial to the success of our economic system. This confidence is threatened by not only the Enron scandal but by the dramatic decline in accounting standards. People increasingly feel the game is rigged. Unless Washington and business professionals seize the moment to clean up the mess in the market economy, they risk a major populist backlash.
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