He also explained that the complexity of the business was due largely to tax strategies and position-hedging. Powersthe dean of the University of Texas law school.
Bush signed into law the Sarbanes-Oxley Act. The company had actually experienced difficulty selling its commercial paper for a week, but was now unable to sell even overnight paper.
This type of accounting enabled Enron to write off unprofitable activities without hurting its bottom line. However, despite Enron's poor accounting practices, Arthur Andersen offered its stamp of approval, signing off on the corporate reports for years. Companies are allowed to recognize the whole future profit at time of signing the contract and need to adjust this value regularly for profits or losses.
The most prominent ones were two banks, Citigroup and Chase Manhattan. The next day, however, Skilling admitted that a very significant reason for his departure was Enron's faltering price in the stock market.