Kinder Dinner Skit - Skilling

Enron’s video skits
show ironic twists

Jokes made by former executives parallel
actual events that led to company’s downfall
By Scott Cohn
CNBC
Dec. 17 —  It all seemed funny at the time. A newly-surfaced videotape of former top Enron executives — along with a future and former President of the United States — is either an innocent office joke, or an eerie glimpse of fraud to come.

 

“WE’VE BEEN WORKING really hard, and we’ve really pulled out all the stops. Look at what we’ve got,” said Jeffrey Skilling, the president of Enron in 1997. “We did 20 million last year. We think we can do 120 million this year.”
       And it’s supposed to be a joke.
       It’s a going away video for Skilling’s predecessor, Richard Kinder, who was leaving to start his own firm.
       In the video, Skilling tells Kinder — played by Enron’s Peggy Menchaca — that he’s come up with a way to really pump up revenue.
       “I haven’t mentioned this before, Rich, but this is the key. We’re going to move from market-to-market accounting to something I call HFV — Hypothetical future value accounting. If we do that, we can add a kazillion dollars to the bottom line.”
       An accountant sitting next to Skilling replies, saying, “I don’t know, Rich. We’ve got the FASB rules and the SEC. The accountants are just never going to go for it.”

     Skilling responds, “He’s a spoil-sport. Always has been.”
       An Enron spokesman confirms the existence of the tape, which was obtained by NBC’s Houston affiliate, KPRC. But he calls the tape “ancient history.”
       Nonetheless, in hindsight, the humor on the tape is, at least, spooky.
       Former Chief Accounting Officer Richard Causey, who would find himself testifying before Congress about alleged accounting fraud at Enron five years later, jokes on the tape about the joys of cooking the books.
       “Rich, I’ve been in this job a week managing earnings. It’s easier than I thought it would be. I can’t even count fast enough to keep up with the earnings rolling in,” Causey says.
       And former Chairman Kenneth Lay, on the perils of not making profit targets, says, “You’d never do all those ugly things to people who don’t make their numbers. Would you?”