Enron - Week 3Enron - Week 3Read and respond to ATC 7-7 on page 285. This situation is similar to the Enron scandal from several years ago. Use the Ashford Online Library to research Enron accounting procedures. In your post, discuss how these accounting procedures affected the company and stockholders. Youmust respond to at least two of your classmates' postings to receive full credit.According to finance.laws.com (2012),"The Enron Scandal is considered to be one of the most notorious within American history.0 Due to the actions of the Enron executives, the Enron Company went bankrupt. By misrepresenting earnings reports while continuing to enjoy the revenue provided by the investors not privy to the true financial condition of Enron, the executives of Enron embezzled funds funneling in from investments while reporting fraudulent earnings to those investors; this not only proliferated more investments from current stockholders, but also attracted new investors desiring the enjoy the apparent financial gains enjoyed by the Enron corporation. The loss sustained by investors exceeded $70 billion. Furthermore, these actions cost both trustees and employees upwards of $2 billion; this total is considered to be a result of misappropriated investments, pension funds, stock options, and savings plans – as a result of the government regulation and the limited liability status of the Enron Corporation, only a small amount of the money lost was ever returned" (http://finance.laws.com/enron-scandal-summary 2012).The Enron scandal was unethical and immoral.0 Many people put their life savings into the company; thinking that they would make a lot of money.0 The clients were told that they were making money but, the company was spending their money.0 What makes it worse is that the main executives knew what they were doing and did not care.0 I feel that this is a case of “greed” and stupidity.0 When the heat was on them from the F.B.I and the I.R.S, Enron actually started to shred paperwork.0 In the end it cost them their jobs and prison time.Several standards of the AICPA’s Articles have been violated such as: Article I, Responsibilities, which is carrying out their responsibilities as professionals, members should exercise sensitive professional and moral judgments in all of their activities (Edmonds, Olds, McNair, & Tsay, 2010).0 0Article II, The Public Interest, which is that members should accept the obligation to actin a way that will serve the public interest, honor the public trust, and demonstrate commitment in professionalism (Edmonds, Olds, McNair, & Tsay, 2010).Article III, Integrity to maintain and broaden public confidence, members should perform all professional responsibilities with the highest sense of integrity (Edmonds, Olds, McNair, & Tsay, 2010).Article V Due CareA member should observe the profession's technical and ethical standards, strive continually to improve competence and the quality of services, and discharge professional responsibility to the best of the member's ability.Article VI Scope and Nature of ServicesA member in public practice should observe the principles of the Code of Professional Conductin determining the scope and nature of services to be provided" (Edmonds, Olds, McNair, and Tsay 2010).00David Sheridan and the Enron scandal are alike.0 David wanted more money and went about it the wrong way.0 In order to start a business you have to have a lot of money to start and make sure that you manage your money the right way and log the money coming in and going out. David’s investors and creditors helped David get away with it because of the fraudulent reports of earnings for the embezzling of the money coming in. This is just wrong and there are alot of people that still do embezzling and get away with it.0 Greed is a horrible disease to have.0 Italways gets you in the end.References:Edmonds, T., Olds, P., McNair, F., & Tsay, B. (2010). Survey of Accounting (2nd edition). New York: McGraw-Hill IrwinEnron Scandal