December 2: Enron filed for Chapter 11 Bankruptcy (2001)

Enron, a Houston, Texas-based American energy, commodities and services company, filed for Chapter 11 bankruptcy. Before the bankruptcy, Enron was one of the world's leading energy companies dealing with electricity, natural gas, communications, pulp and paper and its revenue was nearly $101 billion in 2000. Enron was very creative and innovative in energy trading in many ways including online trading, however, it should not have used its creativity in accounting. In 2001, it was revealed that its reported financial condition was sustained substantially by systematically manipulated accounting fraud. It then became a symbol of willful corporate fraud and also raised a question of corporate accounting and audit practice. As a result of the Enron scandal, the Arthur Anderson accounting firm was dissolved. The impact of the scandal to the US economy, further to the global economy, was significant. The Sarbanes-Oxley Act (SOX) of 2002 was created to tighten up the financial controls of American corporations and to fix malfunctioning corporate governance and accounting practice. Enron: The Smartest Guys in the Room - an interesting and comprehensive book (2003) and documentary film (2005) about the scandal.