Which of the following is NOT true according to Enron's case?
A)Fastow developed the concept of buying up oil and gas companies to increase Enron's reserves for future sale.
B)Fastow worked to structure ventures that met the conditions under GAAP to keep the partnership activities off Enron's books and on the separate books of the partnership.
C)Fastow created SPE that borrowed money from banks and transferred to Enron in a sale of an operating asset no longer needed by Enron.
D)The SPE created by Fastow enabled Enron to keep debt off its books while benefiting from transfer and use of the cash borrowed by the SPE.

Question

Quizplus · Accepted Answer

It is true that Fastow developed the concept of buying up oil and gas companies to increase Enron's reserves for future sale. This was part of Enron's strategy to present itself as an energy trading company with considerable assets. However, this question asks for the statement that is NOT true. B, C, and D are all true statements regarding Fastow's actions in structuring partnerships and special purpose entities (SPEs) to keep debt off Enron's books and maximize profits.

Which of the Following Is NOT True According to Enron's