Author Archives: Ramya Shah

The author of the article speaks about the beginning of a long process of congressional meeting into the Enron case, the largest corporate bankruptcy in the history of the United States. The limited success that F.A.S.B. achieved due to the constant meddling of Congressional members was one of the biggest contributing factors to the bankruptcy case. Had the F.A.S.B. actually got serious about making reforms of the current accounting model, like adjusting reported earnings for changes in current prices of assets, recognizing and amortizing many intangible assets that were not even seen on the balance sheet; the Enron debacle would have been easily avoided. A lot of investors along with likes of Warren Buffett and the S.E.C. also supported most of F.A.S.B.’s initiative but were given a blind eye by the Congress.

F.A.S.B should have taken a stronger stance in passing laws since Congress will at times make biased decisions since it’s clear that the law makers always serve corporate interests and not those of investors because that’s where the biggest chunk of the campaign funds lies. Enron was a crisis that could have been avoided had the Congress not intervened in accounting policies that they have little knowledge about. It’s another blatant example of the misuse of bureaucratic power proving the arrogance of a group of individuals, blinded with power, greed and money; that for a couple of dollars would sell their souls to the devil. The underlying truth which is never sensationalized or what does not come to light is the lives of the millions of small investors that get affected when these companies go bust. Who is accountable for this blatant disregard for the retailer’s wealth? Where do we draw the line?