... up on Enron's books because of the partnership status as separate entities. Enron's management transferred assets (and any related debt) to the special purpose entities at an appraised value above the net cost of the assets, recording a gain on the transfer. Such transactions would have an effect on ... effects of the transaction are transparent to the reader of the financial statements. Enron did not meet the third criterion because the notes related to the SPEs in Enron's financial statements were written so obtusely that they were not transparent to the reader. There was ... company?...

• Word Count: 1893
• Approx Pages: 8
• Grade Level: Undergraduate

... compensation. As part of the capitalization of an entity designed to hedge an investment Enron held in a bankrupt broadband company, a $1.2 billion entry was made to Enron's books to increase notes receivable and shareholder's equity. When these hedging arrangements were terminated to avoid having to issue more than 58 million shares of its" own stock, Enron recorded a loss ... two and a half years. During this period, as a result of improper accounting procedures, net income was overstated by approximately $9 billion, with an offsetting overstatement of capital assets on the balance she...

• Word Count: 2557
• Approx Pages: 10
• Grade Level: Undergraduate