Conspiracy of Fools: Audit Adjustments

Enron had a history of trying to elicit favorable opinions on accounting issues from Arthur Andersen. The executives were aggressive in their reporting of income and expenses, always seeming to find a way to report things in the way that had the best effect on earnings.

As a part of Enron’s merger with Portland General, the company was acquiring a supply contract worth millions. Enron had a history of reporting income as soon as a contract was signed (which is a very aggressive and maybe incorrect accounting treatment), so naturally the executives wanted to book this contract as income immediately.

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Former Illinois governor George Ryan convicted of fraud and racketeering

A jury trial ended in conviction for former Illinois governor George Ryan. He was found guilty of all charges, including [tag]fraud[/tag], obstructing the Internal Revenue Service and lying to the FBI. The charges against Ryan were related to accusations of funneling large state contracts to friends and political insiders. In return for those contracts, Ryan … Read more Former Illinois governor George Ryan convicted of fraud and racketeering

Illegal immigrant studying at Princeton University

Dan-el Padilla Peralta is an [tag]illegal immigrant[/tag] and a student at Princeton University. He turned himself in two weeks ago. He has won a scholarship to Oxford University in the United Kingdom, but if he leaves the United States he won’t be allowed to return. Princeton knew that Dan-el was in the country illegally, but … Read more Illegal immigrant studying at Princeton University

Frank Jude Jr’s reaction to not guilty verdict

According to the Milwaukee Journal Sentinel, Frank Jude Jr. is “devastated and disgusted” at the news that three former Milwaukee police officers were acquitted of charges of beating him in October 2004. Jude is currently at the Oshkosh Correctional Institution as a result of a parole violation following a physical altercation with his mother. His … Read more Frank Jude Jr’s reaction to not guilty verdict

Conspiracy of Fools: Enteron???

Two existing companies came together to form the company that would later be known as Enron. The original companies were Houston Natural Gas (HNG) and InterNorth. The new company was called HNG/InterNorth, but constant power struggles between the two sides lead management to believe they needed one name to help unify the company.

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Pen thief?

Maruicio Aguirre-Orcutt is currently serving a 57 month sentence in federal prison for fraudulently obtaining a $4,200 pen. Over three years, Aguirre-Orcutt collected dozens of limited-edition fountain pens by telling people that the pens would be given to celebrities or political leaders. Pen collecting is a hobby in which collectors gather to show of their … Read more Pen thief?

Jeffrey Skilling declares his innocence

The former president of [tag]Enron Corp[/tag], [tag]Jeffrey Skilling[/tag], has taken the witness stand in his own defense Monday. He said, “I am absolutely innocent.” His testimony included a narrative on the company’s growth and quality of employees, and he declared that he never told any subordinates to lie or manipulate the financial statements. Skilling is … Read more Jeffrey Skilling declares his innocence

Third Party Confirmations Eyed

Compliance Week
By Tammy Whitehouse

In light of regulatory action against fraudulent third-party audit confirmations, some law firms are advising their clients to proceed more carefully when asked to provide such confirmations.

“We’re cautioning our clients regarding providing third-party confirmations, as are most major law firms,” said Frederick Lipman, partner with Blank Rome and president of the Association of Audit Committee Members. Lipman said the firm advises its clients to run all responses to audit confirmation requests through the accounting department, rather than sales or marketing functions, so the company can have confidence in the accuracy of the information it provides.

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