ENRON Case Study Essay Example | Topics and Well Written Essays - 1500 words

ENRON Case Study - Essay Example ? What is so staggering, so appalling, so outrageous is that this once $50 billion company melted to nothingness during the period November 8, 2001, when it restated its earnings retroactive to 1997, to December 2, when it filed bankruptcy (Hartgraves, 2002)†. On October 16, 2001, Enron Corporation of Houston, Texas, one of the largest corporations in the world, announced it was reducing its after-tax net income by $544 million and its shareholders equity by $1.2 billion. On November 8, it announced that, because of accounting errors, it was restating its previously reported net income for the years 1997–2000. These changes reduced its stockholders equity by $508 million. Thus, within a month, Enrons stockholders equity was lower by $1.7 billion (18% of previously reported $9.6 billion at September 30, 2001) (Hartgraves, 2002). The ability to respond to the needs of the customer by identifying them is the most important strength of Enron. Another added advantage or strength is the integrated approach that the company has got towards doing business at an international level. The company has also got extensive access to various physical assets. This acts as one of its strengths because this is expected to results in growth of earnings continuously. The manpower that Enron has got was also a major strength of the company. The staff of Enron took pride over the company and they gave out their best to improve the performance of the company. The environment of the company was felt to be very innovative and progressive by most of its employees. Also the company had a strong voice of the public i.e. a very good name among the investor group. This too can be attributed as one its strength. Apart from this, Enron was ranked as the seventh on the list of fortune 500 companies which gave the company vast fame as a credible company (Jeff Porter, 2005). â€Å"The company’s reputation and public perception were also considered to be its strengths (Jeff Porter,