Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : The ENRON Scandal -- Ignore unavailable to you. Want to Upgrade?

To: Baldur Fjvlnisson who wrote (3559)	3/22/2002 1:09:47 PM
From: Mephisto	Read Replies (1) \| Respond to of 5185

We were running a surplus in the social security sector until Bush spent it. I don't know how the money was accounted for but everyone agreed there was a surplus.

To: Baldur Fjvlnisson who wrote (3559)	3/22/2002 1:11:38 PM
From: Mephisto	Respond to of 5185

Steps can head off another Enron OPINION WEDNESDAY o March 20, 2002 Atlantic Journal Constitution @issue / Mike Luckovich / The Vent / Send a letter Staff Wednesday, March 20, 2002 As 10 congressional committees were parading the villains and victims of Enron before the public, and as 32 separate pieces of reform legislation were being introduced, the marketplace was exacting its own retribution. Enron is in bankruptcy. Executive careers are ruined. Arthur Andersen, one of the world's largest accounting firms, may not survive. Other firms with obscure and incomplete financial reports had their stocks thrashed, and companies have scrambled to supplement official reports with additional details to reassure investors. General Electric, in an example others will quickly emulate, adopted new disclosure guidelines that will produce financial statements the size of a phone book. Still, legislative and regulatory reforms are also needed to prevent such outrages in the future. They should focus primarily on guaranteeing more accurate information, delivered to investors in a more timely fashion. Enron was first and last a bad business model, as so many dot-coms proved to be. And while reforms can't turn bad business models into good ones, they can give investors the information they need not to be bamboozled by hidden debt and inflated earnings. Auditing companies, for example, must be prohibited from serving a company both as honest auditor and as business consultant. The potential conflict of interest is simply too great. And while the accounting profession would prefer to reform itself from within, a new, independent oversight board is needed to judge accounting practices from the perspective of investors. Accountants must be barred from later taking jobs with the companies they are hired to audit, until now a common practice. An auditor hoping to land a lucrative job with his client will not be aggressive in his work. The Securities and Exchange Commission, the agency charged with ensuring thorough and trustworthy audits and financial statements, also needs some help, most obviously in its budget. It has become notoriously short-staffed and underfinanced. Finally, because there will always be a few executives who will connive to get around any reform, Congress needs to enact more severe civil and criminal punishment. President Bush has proposed barring executives from serving in publicly traded companies if they commit fraud or other abuses of powers. The White House also proposes a means of confiscating executive bonuses that are paid based on overstated corporate profits. These changes seem only fair. Fraud is criminal and should be prosecuted. And if the federal government moves to tighten its anti-fraud statutes, as it seems to be doing, there's no need to invite state attorneys general into federal territory. These reforms, coupled with the cleansing power of the marketplace, should make Enron-like fraud much less likely and much less tempting. accessatlanta.com