Business Communication

"TEXAS UNIVERSITY"

BUS 303-Bussiness Communication

Module 2

Case Study

In module 2 case study, the question is posed, "Is more government oversight of corporate finances needed? "Every corporate official who has chosen to commit a crime can expect to face the consequences. No more easy money for corporate criminals, just hard time," said President Bush. I agree with President Bush, something must be done to stop corporate business financial crimes.

Enron has paved the track as the forefather of corporation financial scandals. Yes, corporate corruption is rampant, and no, Enron is neither the first nor the last company to engage in it. When a store chain such as Kmart goes bankrupt, Wal-Mart, Target, or some other competitor is available to fill the gap. When an energy company such as Enron goes bankrupt and must end some or all of its operations, another energy company may need time to adapt to and accommodate the markets the failed company had to abandon. This lack of competition is one reason Enron survived as long as it did, and it is one reason that makes its collapse that much more difficult for countries and people who those aggrieved shareholders probably never considered as more affected than themselves. (Carey) Other companies have managed to slide under the ethic radar for years. In light of the Enron's scandal several companies are now under FBI investigations.

Yes, there should be more oversight. But I feel the question should be, "Is the government the proper agency to prevent corporate fraud? Most would say it cannot be overstressed that the government itself has paved the way for the efflorescence of these companies' accounting creativity. For example, around 1980, with the explicit purpose of restoring the power and profits of a U.S. financial sector that had been hard hit by the runaway inflation and low demand for credit of the 1970s, the federal government systematically dismantled the system of financial regulation that had been put in place by the New Deal in the wake of the last great bubble and bust. (Brenner) In his 1993 Reinventing Government program, Vice President Al Gore encouraged the proliferation of federal government corporations, obscure government devices whose legal