Causes Of Enron Corp.'s Bankruptcy And Its Revelation

The thesis is an analysis of the direct causes of Enron Corp.'s bankruptcy and probes into the phenomenon of Enron Corp. from different stages and levels. By adopting a systematic approach, the author attempts to reveal the causes and direct links which lead to the abrupt collapse of the company from its brilliance. The author wishes to draw the revelation which may give guidance to those Chinese firms and the stock market from his analysis of Enron Corp.'s bankruptcy and his understanding of the situation and circumstances in China.This thesis is divided into four parts, dealing with the topics of the sudden rise to brilliance, direct causes of bankruptcy, defects and direct links leading to this bankruptcy, and the revelation of the bankruptcy respectively.The first part reveals and analyze the history and steps how Enron Corp. developed from an obscure gas-pipeline company into a financial company in Wall Street. By deconstructing the phenomenon of how Enron reached its brilliance, this part lists and reveals the basic elements which would result in Enron's abrupt collapse.The second part analyze the direct causes of Enron's abrupt collapse and probes into the set up of Special Purpose Entities of hiding debts and counterfeit increase of income and profits, which received wide criticism from the investors, and the relevant transactions which caused the financial crisis of the company and resulted in the sharp shrink of its stock price and degradation of credit to junk bond.The third one would specialize in the analysis of the defects and direct links of Enron's collapse from the angles of company development strategy, enterprise culture, and company management structure.The fourth part would display the revelation of this bankruptcy. Combined with the analysis of Chinese local conditions and circumstances, the author wishes to reveal how the collapse of the company would help to guide Chinese firms and stock market onto a way of smooth and health development.