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Downfall and bankruptcy: Because the boom several years ended and Enron faced elevated Opposition in the Strength trading enterprise, the corporate’s earnings shrank promptly. Stressed from shareholders, business executives began to trust in doubtful accounting techniques, such as a method generally known as “mark-to-marketplace accounting,” to cover the difficulties.
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Mark-to-industry accounting authorized the corporate to write unrealized future gains from some buying and selling contracts into current income statements, So offering the illusion of better latest revenue.
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