Most of the world has heard of Enron, the mega American energy company that has "distorted" their accounts (Gupta, Weirich & Turner, 2013) and is costing its investors billions of dollars in lost earnings and retirement funds. While much of the controversy surrounding the Enron scandal has focused on investor losses, executives' unethical practices, and questionable accounting tactics, there have been many others in the immediate vicinity of the turmoil. The question arises: who was really to blame and what was done to prevent this from happening again? The story of Enron begins in 1985, with the merger of two pipeline companies, orchestrated by a man named Kenneth L. Lay (Zellner & Foresta, 2001). In its 15 years of existence, Enron expanded its operations to provide products and services in the electricity, natural gas, and communications industries. Due to its diversification, Enron would become known as America's Favorite Company (Tonge, Greer & Lawton, 2003) and as Fortune magazine's Most Innovative Company for 5 consecutive years (Hayes & Ariail, 2013). They reported extraordinary profits in a short span of time. For example, in 1998 Enron stock was valued at just over $20, while in mid-2000 those same shares were valued at just over $90 (Hayes & Ariail, 2013), an all-time high during the company's existence (Tonge , Greer & Lawton, 2003). While the numbers looked good, the process behind them was questionable. Unbeknownst to many, Jeff Skilling, a senior executive at Enron, managed to persuade the SEC and their accounting firm, Arthur Anderson & Company, to approve the use of mark-to-market (M2M) accounting. This technique allowed the company to report profits from long-term contracts early, before all earnings were actual… middle of paper… Stewart, B. (2006). The real reasons Enron failed. Journal of Applied Corporate Finance, 18(2), 116-119. Retrieved from Business Source Complete database. Tonge, A., Greer, L., & Lawton, A. (2003). The Enron Story: Sometimes you can fool some people. Business Ethics: A European Review, 12(1), 4-22. Retrieved from the United States Business Source Complete.Securities and Exchange Commission database. (2011). Dodd-Frank Act Rules: Whistleblower Program. Retrieved from http://www.sec.gov/spotlight/dodd-frank/whistleblower.shtmlWillits, S. D. & Nicholls, C. (2014). Does Sarbanes-Oxley work? The CPA Journal, 84(4), 38-43. Retrieved from Business Source Comprehensive Database.Zellner, W. & Forest, S.A. (2001, December). The fall of Enron. Working week. Retrieved from http://www.businessweek.com/stories/2001-12-16/the-fall-of-enron.