Enron

The Board of Directors. With respect to the issues that are the subject of this investigation, the Board of Directors failed, in our judgment, in its oversight duties. This had serious consequences for Enron, its employees, and its shareholders. The Board of Directors approved the arrangements that allowed the Companys header financial officer to serve as general follower in partnerships that participated in signifi arset financial deeds with Enron. As far-famed earlier, the deuce members of the Special Investigative sweartee who have participated in this surveil of the Boards actions believe this decision was fundamentally flawed. The Board comfortably underestimated the severity of the conflict and overestimated the degree to which management controls and procedures could contain the problem. afterward having pass a conflict of interest creating as some(prenominal) fortune as this one, the Board had an obligation to give circumspect charge to the executions that followed. It failed to do this. It butt endnot be faulted for the various instances in which it was trim denied important information concerning certain of the dealingss in question. However, it can and should be faulted for failing to demand more information, and for failing to analyze and understand the information that did come to it.

The Board authorized the Rhythms achievement and three of the Raptor transactions. It appears that many of its members did not understand those transactions-the frugal rationale, the consequences, and the risks. Nor does it appear that they reacted to warning signs in those transactions as they were presented, including the affray to the Fi! nance direction in May 2000 that the proposed Raptor transaction raised a risk of accounting scrutiny. We do note, however, that the Committee was told that Andersen was comfortable with the transaction. As complex as the transactions were, the knowledgeableness of Fastows conflict of interest demanded that the Board gain a proclaim understanding of the LJM...If you want to get a full essay, commit it on our website: BestEssayCheap.com

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