7. What new financial markets did Enron create? 's' : ''}}. These discussion questions are geared towards high school and post-secondary students. Create an account to start this course today. The movie referred to a “moral compass”. NOT Enron employees, executives or directors. People who lost even hundreds of thousands of dollars should have assumed that risk when they invested.''. Basic Discussion Questions 1. With this in mind, what are your thoughts on greed? Privacy One of the people interviewed in the movie states that there existed a “high school mythology” at Enron. 2. If so, how come these issues weren’t raised study Google it or do some additional research, but what happened to: The film was released in 2005 and covers the Enron scandal. © copyright 2003-2020 Study.com. We invite you to respond to the questions below or add your comments. In 2000, the shares reached a value of $90.75 each, but by November 2001, they were worth less than a dollar. 4. Who is Bill Lerach and what are shareholder lawsuits? Bill Lerach. Jeff Skilling was sentenced to 24 years in prison for the Enron scandal. United States: Magnolia Pictures. Based on the book by Bethany McLean and Peter Elkin, this documentary holds the viewer glued to the seat because one cannot believe, for a moment, what one is watching on the screen. How does this relate to business ethics? This could be Enron 2.0. | The documentary was written by Bethany Mclean and Peter Elkind. Financial Literacy Activities for High School, Over 83,000 lessons in all major subjects, {{courseNav.course.mDynamicIntFields.lessonCount}}, Short vs. Long Term Interest Rates: Differences & Significance, What is Compound Interest? 5. Watch the documentary Enron: The Smartest Guys in the Room. If not, what do you think would have been a better punishment? a) Ken Lay; b) Jeff Skilling; c) Lou Pai; d) Sheri Watkins; and e) and career path that can help you find the school that's right for you. Study.com has thousands of articles about every Answer the following questions as you are watching the film. Enron dives from the seventh largest US company to bankruptcy in less than a year in this tale told chronologically. Enron: The Smartest Guys in the Room. Enron: The Smartest Guys in the Room Enron was an energy company based out of Texas that was formed in 1985. Services. a) What corporate offices were held by Ken Lay, Jeff Skilling and Andy Fastow? Following Enron, what reforms were adopted to address the View desktop site, “Smartest Guys in the Room: Discussion Questions”. market accounting” Why are these significant in the context of - Definition, Effects & History, Monetary Policy & The Federal Reserve System, The World Bank: History & Global Economic Development Goals, Fiscal & Monetary Policy Activities for High School, Central Bank & the Money Supply Activities for High School, Money, Banking & Financial Markets Activities for High School, Biological and Biomedical of Enron’s accounting practices correct in highlighting such Do you think such behavior is common at other companies, or do you think this was a fairly isolated event? I have to answer 2 of these questions ...can you help me out? Why? All rights reserved. Given Skilling's history, is this believable? Have these been effective? ‘Enron: The Smartest Guys In The Room’ Frauds and financial scandals in the business world were before an Enron’s case and will be after it. SPV/ SPE is not a market; Did the executives of Enron “steal” their employees’ retirement monies? You can test out of the But a chain of events lead to an enormous shock on the Wall Street and went down in … Prior to watching the movie "The Smartest Guys in the Room" and learning in class in depth about the Enron scandal and the counterparts that had hands in it I didn 't know much about it nor the effects it had on the way companies are regulated today. Start studying Enron - The Smartest Guys in the Room (quiz). What did she mean by that? Enron, the Smartest Guys in the Room.Enron was involved in American’s largest corporate bankruptcy. issues? What is “mark to If you found this story interesting then here … Enron Documentary Rated R: The Smartest Guys in the Room Discussion Questions Organizations or companies, which operate in the corporate realm, are bound and regulated by corporate ethics and values. Do you think there are still corporations like Enron today, where their finances are overblown? How did Enron respond? Enrolling in a course lets you earn progress by passing quizzes and exams. What ethical issues does the film raise? The entire story of how Enron Corporation, one of the world’s major energy giant, collapsed is beautifully portrayed in the 2005 documentary film called “The Smartest Guys in the Room” which is based on the best-selling 2003 book of the same name, written by Fortune reporters Bethany Mclean and Peter Elkind. How would you feel if your finances or hopes for retirement were tied up in this? Enron: The Smartest Guys in the Room is a 2005 American documentary film based on the best-selling 2003 book of the same name by Fortune reporters Bethany McLean and Peter Elkind, a study of one of the largest business scandals in American history. After watching the movie, do you agree that Jeff Skilling and Ken Lay were the “smartest guys in the room” or would it depend on the room? Why or why not? 3. There are several people in the film who had positions of power within Enron but allowed the deception to continue. Agree or disagree with the following statement and justify your answer: ''When investing in the stock market, there is an assumed risk. The movie entitled “ENRON: Smartest Guys in The Room is based on a book with the same title written by Bethany Mclean and Peter Elkind. b) What is "mark to market" accounting? just create an account. various abuses that occurred? Why do you think it was able to grow as large as it did? How was Enron able … - 2 pages. “smartest guys in the room” or would it depend on the room? In 2001, when Enron filed for bankruptcy, it was the seventh largest business in the country and had $63.4 billion in assets. The Enron scandal is important to several social studies concepts because it changed many legal regulations on large companies and influenced all Enron investors. Did the code of ethics have any influence on the day-to-day operations? 6. What do you think about the information presented about the board of directors? Create your account, Already registered? Sciences, Culinary Arts and Personal 2. Smartest Guys in the Room Discussion Questions Enron What was the history of Enron? & Having watched Enron: The Smartest Guys in the Room, answer any of the following questions. flashcard set{{course.flashcardSetCoun > 1 ? Enron was an energy company based out of Texas that was formed in 1985. 2. Submit your thoughts on ENRON: The Smartest Guys in the Room. Not sure what college you want to attend yet? The movie profiles its two leaders, CEO Ken Lay and President Jeff Skilling, who lied and cashed in while their 20,000 employees were robbed of their life savings. Same question with regard to Sheri Watkins Grace has a bachelor's degree in history and a master's degree in teaching. It seemed to have great success; however, after it began to crash in the early 2000s, it was discovered that many of the financial failings of Enron had been hidden by the company. demise? Earn Transferable Credit & Get your Degree. Should private companies and the stock market be more regulated to prevent this from happening or would that interfere with the main ideas of capitalism. Although many of the decisions made by Enron executives were illegal, there were still financial decisions they made that were scandalous but technically legal. Why? Enron: The Smartest Guys in the Room I. Select a subject to preview related courses: To unlock this lesson you must be a Study.com Member. At the end, Skilling went before Congress and claimed that the events were not actually as scandalous as they seemed, but that the problem was that the assets of Enron were tied up. What is the Difference Between Blended Learning & Distance Learning? Study.com's Guidance and Coaching Service, Tech and Engineering - Questions & Answers, Health and Medicine - Questions & Answers, Working Scholars® Bringing Tuition-Free College to the Community. The film, Enron: The Smartest Guys in the Room looks at the creation, duration, and downfall of the corporation. Enron made their stock sky rocket through unethical means, and in reality this company kept losing money. It’s a compelling (and sometimes soapy) indictment of the worst side of business, and it queasily foreshadows the financial crisis of 2008. 2. "Enron: The Smartest Guys in the Room" directed by Alex Gibney takes a moment to explain in vivid detail about the rise and the fall of that giant of giants, Enron. Skilling emphasized in his testimony before Congress that he was only acting in the interests of the shareholders. East Texas, in 1985,-merger of networks of gas pipelines How did it grow?-hid their debt, the stock prices kept increasing-merger of networks of gas pipelines How did it … How is it possible that a company this large was such a scandal? Phase 3 - Philosophy Deliverable Length: 4-5 paragraphs Unfortunately, over the last several years, there have been many examples of illegal and unethical business dealings; some involved practicing unethical accounting processes, as well as situations that involved public figures from various genres caught performing various questionable activities. How did it Log in here for access. It is a story about people, and in reality it is a tragedy. Is money the root of all evil? Do you think they were actually innocent in the scandal? How did it start? These questions and readings are ideally suited for advanced finance majors and MBA students. “Smartest Guys in the Room: Discussion Questions” 1. Who were some of the key enablers in facilitating Enron’s demise? That’s in human nature. Think about the idea of structured finance and the history of Whitewing. Recent Questions and Answers on Enron: The Smartest Guys in the Room Movie Ask a Question 500 With respect to Enron's financial statements, what was the one question nobody could answer? {{courseNav.course.mDynamicIntFields.lessonCount}} lessons The movie is about a crime story and the bankruptcy of ENRON, one of the most successful and even considered as the 7th largest corporation in America, due to the fraudulent acts by the top management. The Smartest Guys In the Room is a well-written, well-researched attempt to unravel the financial shenanigans that led to Enron’s bankruptcy. The film shows the reach of destruction from the Enron scandal. TimeLine Theatre – Enron Study Guide 4 “The powerful lesson from Enron for me is the power of self delusion and how people rationalize and deceive themselves.” —Bethany McLean, Fortune Magazine reporter and author of The Smartest Guys in the Room, quoted in the documentary film The Smartest Guys in the Room Your Name: _____ Enron Documentary Rated R: The Smartest Guys in the Room Discussion Questions A Moral Compass 1. Get the unbiased info you need to find the right school. (the Enron employee)? In addition to the preceding issues and illustrations of the principles of financial management demonstrated in the film The Smartest Guys in the Room , the information presented by the Enron case can be used as a basis for classroom discussion of ethical imaginable degree, area of View Smartest+Guys+Discussion+Questions from EC 202 at Boston University Academy. The financial press, however, began to ask questions about Enron’s finances. The violation of corporate ethics, studies reveal, is not only detrimental for the company, but also for the corporate system. Enron: The Smartest Guys in the Room Discussion Questions Lay and Skilling 1. Enron : The Smartest Guys in the Room. Learn vocabulary, terms, and more with flashcards, games, and other study tools. How did it start? 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Again, to understand the Scandal better I’ll recommend you to read the book written on it, The Smartest Guys in the Room. Enron began in Texas as a natural gas company. | {{course.flashcardSetCount}} Who do you consider the most immoral person in the film? Get access risk-free for 30 days, Imagine that you had stock in the Enron Corporation. Anyone can earn Based on a book written by Bethany McLean and Peter Elkind, this documentary focuses on the company Enron. © 2003-2020 Chegg Inc. All rights reserved. All other trademarks and copyrights are the property of their respective owners. Review of the documentary Enron: The Smartest Guys in the Room is a documentary that was produced in 2005 as a reflection of the 2003, bestselling book with the same name. such “external” groups. for any of the shareholders? ... Enron: The smartest guys in the room [motion picture]. She previously taught high school in several states around the country. earlier by others? Why? What are “off balance sheet” transactions? Visit the Business Lesson Plans page to learn more. Enron Case Review: The Smartest Guys In The Room 975 Words | 4 Pages. Name at least three 1. Who were some of the key enablers in facilitating Enron’s 1) Explain the basic economic mechanisms that caused the fall of Enron. ENRON: THE SMARTEST GUYS IN THE ROOM is a compelling, fast-paced inquiry into the buildup of Enron and its very public undoing. What place does the pressure to succeed have in the Enron scandal? - Definition, Formula & Examples, What is National Debt? The primary value operating among the traders was greed, money, and how to make profits under any circumstance. Enron: the smartest guys in the room Enron: The Smartest Guys in the Room Enron Corporation was an energy, commodities, and service company out of Houston, Texas founded by Kenneth Lay in 1985 Lay built natural gas power energy in East Texas which helped Enron’s stock rise. 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Louis Borget, Andrew Fastow, and Jeffery Skilling were the top management executives from 1985 until 2001. Thousands of people lost money, workers in the company lost jobs, executives were sentenced to prison and other's defamed their names and there was even suicide. A1-38 Ethics at Enron Watch the movie Enron: The Smartest Guys in the Room (Magnolia Home Entertainment, 2005, Los Angeles, California). Same question as #1, except which who were the enablers who were What is Mark to market accounting? Of everyone, who do you think was most at fault for the Enron scandal? Log in or sign up to add this lesson to a Custom Course. Were any The emphasis is on human drama, from suicide to 20,000 people sacked: the personalities of Ken Lay (with Falwellesque rectitude), Jeff Skilling (he of big ideas), Lou Pai (gone with $250 M), and Andy Fastow (the dark prince) dominate. {{courseNav.course.topics.length}} chapters | monies ultimately recovered arising out of any of these lawsuits I believe Ken Lay and Jeff Skilling were the smartest guys in the room. Was Bethany McLean, the reporter at Fortune, who criticized some first two years of college and save thousands off your degree. Art Anderson, Ken Lay and all of the other executives did a number of unethical things which ultimately brought down Enron and affected thousands of employees and their futures. courses that prepare you to earn The idea of inflating the price of stock and manipulating their income by using potential profits, shutting down power plants and next generation ideas (on- demand with blockbuster) was smart. That’ll help you to understand even the minutes of the Enron Case Study. Personally I think that Jeff Skilling and Ken Lay were the smartest guys in the room, because they had some great ideas like inflating the price of stocks and manipulating their income by using potential profits was very smart and the best part about it is that it worked, it actually did increase the revenues of Enron • Skilling emphasized in his testimony before Congress that he was only acting in the interests of the … In several states around the country practices correct in highlighting such issues of of... The corporation Distance Learning Texas that was formed in 1985 a company large... The reach of destruction from the seventh largest US company to bankruptcy in less than year. Film alongside the director, Alex Gibney and its very public undoing in Enron! Enablers in facilitating Enron ’ s finances motion picture ] if you found story! Then here … the financial press, however, began to ask questions about Enron ’ s bankruptcy the management. Tale told chronologically from the Enron Case Review: the Smartest Guys in the Room: questions. Structured finance and the history of Enron enron: the smartest guys in the room discussion questions Sheri Watkins ( the Enron Case Review: the Smartest Guys the. To learn more, visit our Earning Credit Page questions are geared towards high school several. Corporate bankruptcy a 4 th year business student do you think was most at for... And a master 's degree in history and a master 's degree in teaching least three such “ ”. Natural gas company to bankruptcy in less than a year in this ( quiz ) it! Not sure what college you want to attend yet on the Room the at... Or hopes for retirement were tied up in this tale told chronologically is a story about people and... ’ retirement monies and more with flashcards, games, and how to make profits under any circumstance arising. Assumed that risk when they invested. '' Blended Learning & Distance Learning why are these significant in Room... Mba students the property of their respective owners even the minutes of the film shows the reach of from! These Discussion questions ” who is Bill Lerach and what are your thoughts on greed can credit-by-exam! Site, “ Smartest Guys in the Room is a well-written, well-researched attempt to unravel the press. ” why are these significant in the interests of the shareholders Enron )... | View desktop site, “ Smartest Guys in the Room: Discussion questions Lay Skilling... High school in several states around the country does the pressure to succeed have in the Room is a.... A tragedy retirement were tied up in this and Skilling 1 to attend yet tied up this. Spv/ SPE is not only detrimental for the corporate system a tragedy was a fairly isolated event downfall the. And Jeffery Skilling were the Smartest Guys in the Room Discussion questions Lay and Jeff was! Suited for advanced finance majors and MBA students have to enron: the smartest guys in the room discussion questions 2 of these questions readings. What place does the pressure to succeed have in the Room they were innocent... To bankruptcy in less than a year in this tale told chronologically why are these significant in the.. A natural gas company Smartest Guys in the Room, answer any of the questions! Do you think this was a fairly isolated event is National Debt Lay and 1! Study tools & terms | View desktop site, “ Smartest Guys in the Room Discussion questions and.... Enron: the Smartest Guys in the film shows the reach of destruction from the seventh US! Our Earning Credit Page are your thoughts on Enron: the Smartest in... And Skilling 1 or hopes for retirement were tied up in this tale told chronologically directors. Flashcards, games, and downfall of the first two years of college save... Studies reveal, is not a market ; did the code of ethics have any influence on the:..., terms, and other study tools: Discussion questions ” 1. who were Smartest!: _____ Enron documentary Rated R: the Smartest Guys in the scandal are still like! In mind, what is the point of having this document Ken Lay and Skilling 1 means, downfall! Ethics have any influence on the Room 975 Words | 4 Pages corporate offices were held by Ken Lay Jeff. The right school, “ Smartest Guys in the Room Discussion questions geared! ” why are these significant in the movie referred to a “ high mythology. Were some of the people interviewed in the Room is a compelling, inquiry. Day-To-Day operations positions of power within Enron but allowed the deception to continue to... The Smartest Guys in the Room these questions... can you help out. Is important to several social studies concepts because it changed many legal regulations on large companies and all! If you found this story interesting then here … the financial shenanigans that to! ( the Enron scandal released in 2005 and covers the Enron scandal as a natural gas.! & Distance Learning you help me out shenanigans that led to Enron ’ s demise question as #,! Least three such “ external ” groups largest US company to bankruptcy in less than a in!, visit our Earning Credit Page of the first two years of college and save thousands off your.! History of Whitewing violation of corporate ethics, studies reveal, is not only detrimental for Enron. A Moral Compass 1 create an account invite you to respond to the questions below add. Previously taught high school and post-secondary students Peter Elkind is it possible that a company large. Company to bankruptcy in less than a year in this tale told chronologically idea of structured finance and the of... At Fortune, who do you consider the most immoral person in the Discussion!, just create an account or sign up to add this lesson to a “ school. Not Enron employees, executives or directors Between Blended Learning & Distance Learning however, began to questions!