ACC 201 Week 1 Discussion 2 ACC 201 Week 1 Discussion 2 Enron was a company that came to

ACC 201 Week 1 Discussion 2  ACC 201 Week 1 Discussion 2  Enron was a company that came together in 1985 and it was a merger of two companies, Houston Natural Gas Company and Omaha-based InterNorth Incorporated. Jeffrey Skilling joined the company at a very opportune time because €œderegulation of the energy markets allowed companies to place bets on future prices€ and Enron took full advantage of that (Segal, 2019). Skilling used mark-to-market (MTM) accounting to manipulate the system. According to Segal €œMTM method can be manipulated, since MTM is not based on €œactual€ cost but on €œfair value,€ which is harder to pin down€ (Segal, 2019). Being able to log projected profits as actual profits is what began to get Enron into trouble. It falsified the amount of profit being made. For example €œthe company would build as asset, such as a power plant, and immediately claim the projected profit on its books, even though the company had not made one dime from the asset€ (Segal, 2019). The problem with this is that sometimes the company would not generate the projected revenue and often times fell short. In these cased opposed to taking the loss €œthe company would transfer the asset to an off-the-books corporations where the loss would go unreported€ (Segal, 2019). These kind of devious behavior allowed for Enron to appear as if they were a profitable company even though they were not.   Resources   Segal, T. (2019, May 29). Enron Scandal: The Fall of a Wall Street Darling. Obtained from https://www