yukking it up
We know now that Enron's accounting tricks were a joke. According to a company skit that has surfaced on videotape, senior Enron executives knew as far back as January 1997 (well, duh!).
In one skit, former Administrative Executive Peggy Menchaca played the part of [outgoing Enron President Rich] Kinder as he received a budget report from then-President Jeff Skilling, who played himself, and Financial Planning Executive Tod Lindholm.
When the pretend Kinder expressed doubt that Skilling could pull off 600 percent revenue growth for the coming year, Skilling revealed how it could be done.
"We're going to move from mark-to-market accounting to something I call HFV, or hypothetical future value accounting," Skilling joked as he read from a script. "If we do that, we can add a kazillion dollars to the bottom line."
Richard Causey, the former chief accounting officer who was embroiled in many of the business deals named in the indictments of other Enron executives, made an unfortunate joke later on the tape.
"I've been on the job for a week managing earnings, and it's easier than I thought it would be," Causey said, referring to a practice that is frowned upon by securities regulators. "I can't even count fast enough with the earnings rolling in."
Oh, yeah, and then-governor George W. "I barely know Kenny Boy Lay" Bush was in attendance, along with George Bush Senior.
(via Neptune World)
Update: Brad DeLong has commented as well.