Finally, any stock sales by principals is a matter of Federal public record AND the internal company rumor mill is very effective at circulating stories of upcoming problems. Did everyone think that the Enron stock price dropping from $83 on Jan. 1, 2001 to $24 on Oct. 1, 2001 and $14 on Oct. 29 was just a fluke? Get serious!
Me too. Just for info, here's a copy from the .pdf file of the Enron report, showing the typical boilerplate that is attached to deflect legal responsibility. (Any emphasis or paragraphs in the two statements are mine.)
Information Regarding Forward-Looking StatementsI too have a 401K, but it is under the control of Fidelity, and has no provision for me to place it all in my company's stock. I learned of that when my company was bought by another that only put the employee retirement funds in their own stock. Started at +$20/shr in 1979, and was down to less than $4/shr by the time we were resold in 1989. Now both the retirement and the 401K funds are segregated, and out of the control of the company. I do have some personal stock in the company, but if I lose it, my retirement funds are not at stake.This Report includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical facts contained in this document are forward-looking statements.
Forward-looking statements include, but are not limited to, statements relating to expansion opportunities for the Transportation Services, extension of Enron’s business model to new markets and industries, demand in the market for broadband services and high bandwidth applications, transaction volumes in the U.S. power market, commencement of commercial operations of new power plants and pipeline projects, completion of the sale of certain assets and growth in the demand for retail energy outsourcing solutions.
When used in this document, the words “anticipate,” “believe,” “estimate,” “expects,” “intend,” “may,” “project,” “plan,” “should” and similar expressions are intended to be among the statements that identify forward-looking statements. Although Enron believes that its expectations reflected in these forwardlooking statements are based on reasonable assumptions, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forwardlooking statements.
Important factors that could cause actual results to differ materially from those in the forward-looking statements herein include success in marketing natural gas and power to wholesale customers; the ability of Enron to penetrate new retail natural gas and electricity markets (including energy outsourcing markets) in the United States and foreign jurisdictions; development of Enron’s broadband network and customer demand for intermediation and content services; the timing, extent and market effects of deregulation of energy markets in the United States, including the current energy market conditions in California, and in foreign jurisdictions; other regulatory developments in the United States and in foreign countries, including tax legislation and regulations; political developments in foreign countries; the extent of efforts by governments to privatize natural gas and electric utilities and other industries; the timing and extent of changes in commodity prices for crude oil, natural gas, electricity, foreign currency and interest rates; the extent of success in acquiring oil and gas properties and in discovering, developing, producing and marketing reserves; the timing and success of Enron’s efforts to develop international power, pipeline and other infrastructure projects; the effectiveness of Enron’s risk management activities; the ability of counterparties to financial risk management instruments and other contracts with Enron to meet their financial commitments to Enron; and Enron’s ability to access the capital markets and equity markets during the periods covered by the forward-looking statements, which will depend on general market conditions and Enron’s ability to maintain the credit ratings for its unsecured senior long-term debt obligations.
Management’s Responsibility for Financial Reporting
The following financial statements of Enron Corp. and subsidiaries (collectively, Enron) were prepared by management, which is responsible for their integrity and objectivity. The statements have been prepared in conformity with generally accepted accounting principles and necessarily include some amounts that are based on the best estimates and judgments of management.
The system of internal controls of Enron is designed to provide reasonable assurance as to the reliability of financial statements and the protection of assets from unauthorized acquisition, use or disposition. This system is augmented by written policies and guidelines and the careful selection and training of qualified personnel. It should be recognized, however, that there are inherent limitations in the effectiveness of any system of internal control.
Accordingly, even an effective internal control system can provide only reasonable assurance with respect to the preparation of reliable financial statements and safeguarding of assets. Further, because of changes in conditions, internal control system effectiveness may vary over time. Enron assessed its internal control system as of December 31, 2000, 1999 and 1998, relative to current standards of control criteria.
Based upon this assessment, management believes that its system of internal controls was adequate during the periods to provide reasonable assurance as to the reliability of financial statements and the protection of assets against unauthorized acquisition, use or disposition.
Arthur Andersen LLP was engaged to audit the financial statements of Enron and issue reports thereon. Their audits included developing an overall understanding of Enron’s accounting systems, procedures and internal controls and conducting tests and other auditing procedures sufficient to support their opinion on the financial statements. Arthur Andersen LLP was also engaged to examine and report on management’s assertion about the effectiveness of Enron’s system of internal controls. The Reports of Independent Public Accountants appear in this Annual Report.
The adequacy of Enron’s financial controls and the accounting principles employed in financial reporting are under the general oversight of the Audit Committee of Enron Corp.’s Board of Directors. No member of this committee is an officer or employee of Enron. The independent public accountants have direct access to the Audit Committee, and they meet with the committee from time to time, with and without financial management present, to discuss accounting, auditing and financial reporting matters.
If your company is doing the Enron shuffle, I suggest you get in touch with your Employee Benefits Office and find out how to force a change.