The Failure of the Enron Corporation

To explain the causes of collapse for Enron, you must first examine the company history till its downfall and what it actually did as a company. Enron was formed in July 1985 form the merger of two large natural gas line companies called Internorth and Houston Natural Gas in the US. The company began trading natural gas commodities in 1989 and electricity in 1994. The company made extensive use of the internet to broker sales and quickly became …

…pursued by KPMG which means there are no longer a 'big five' accounting companies but four. As for Enron they have left nearly 15,000 people worldwide without jobs and have jolted US and European governmental departments to take another look at the deregulation of industries. This means that in future such companies would have to have a more transparent accounting practice which in the long term should lead to safer investments in such large global players.