The Enron Case is one of the biggest corporate scandals in recent years. It involved a number of corporate governance issues, where as I would put it, what could go wrong did go wrong. The company turned from an acclaimed company into the most infamous company in the world overnight. Let us now take a look at the case, as to how it happened and how he changed the world of corporate governance practices in his aftermath. Enron was formed by Kenneth Lay in 1985, by merging two natural gas pipeline companies. At the time of merger, Enron owned 35,000 miles of intra and interstate natural gas pipelines, while also trading natural gas. Following from the deregulation of sale of natural gas, Enron experienced increase in revenue and became the largest natural gas trader in North America in 1992. Enron went on to diversify its business, to owning and operating outer assets, including gas pipelines, electricity plants, pulp and paper plants, water plants, and broadband services, inside and outside the US. At the same time, Enron had moved from the traditional business model of asset trading at only spot prices, to also financial trading through long-term contracts. Hence, becoming a financial trader and market maker. Just in the year of 1999 and 2000, Enron stock price increased by 56 percent and a further by 87 percent, which was substantially higher than market averages of those years. By the end of 2000, Enron stock price was prized 70 times his earnings, and six times his book value, reflecting to stock markets high expectations about its future prospects. At the same time, Enron was rated in Fortune's Most Admired Company Survey, as the most innovative large company in America. The downfall of Enron started in 2001, when reporter and investment analysts, started to question about the overpricing of Enron stock, and his unusual accounting practices. Questions were asked specifically about Enron's continuous high growth of revenue, but when asked, CEO Skilling did not reply but only responded in a causal manner. The company then faced some operational challenges and the stock price started falling since the middle of 2001. In August 2001, CEO Skilling resigned after setting a minimum of 450,000 shares of Enron, which he had once held. On August 15th, Sherron Watkins, Vice president for Corporate Development, sent an anonymous letter to Chairman Lay, warning him about the company's accounting practice. Lay assigned the company's law firm to review the issues, and in October, he had announced that Enron had done nothing wrong in his accounting because their auditor, Arthur Andersen had approved HB sue. The trouble of Enron stock price continued in the midst of more analyst and observers queries about the mysteries of Enron's business and opacity of his financial statements. In addition, the company was found to be repeatedly using related party transactions with entities controlled by his CFO Fastow. On October 22nd, the SEC announced that it was investigating several suspicious deals by Enron. Enron stock price plunged by 20 percent in one day. To restore market confidence, CFO Fastow was dismissed by Chairman Lay. Credit rating agencies, began to reveal possible downgrading of Enron's credit rating. A buyout of Enron by another company was once discussed, but the potential buyer disengaged soon after the discussion, as Enron was found to have very little cash, but enormous debts. Enron's credit rating was subsequently reduced to junk status. On December 2nd, 2001, Enron filed for bankruptcy, which was the largest in US history at that time. Employees were told to vacate their offices in 30 minutes. About 60 percent of the employees' savings plans, relied on Enron stock, which had become almost worthless at that time. From the brief account above, which of the following do you think could be the areas of corporate governance issues in the Enron case? The answer is all of them, as revealed in the following.