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The Enron scandal, revealed in October 2001, eventually led to the bankruptcy of the Enron

Corporation, an American energy company based in Houston, Texas, and the de facto dissolution of
Arthur Andersen, which was one of the five largest audit and accountancy partnerships in the world. In
addition to being the largest bankruptcy reorganization in American history at that time, Enron was
attributed as the biggest audit failure.[1]
Enron was formed in 1985 by Kenneth Lay after merging Houston Natural Gas and InterNorth. Several
years later, when Jeffrey Skilling was hired, he developed a staff of executives that, by the use of
accounting loopholes, special purpose entities, and poor financial reporting, were able to hide billions of
dollars in debt from failed deals and projects. Chief Financial Officer Andrew Fastow and other
executives not only misled Enron's board of directors and audit committee on high-risk accounting
practices, but also pressured Andersen to ignore the issues.
Enron shareholders filed a $40 billion lawsuit after the company's stock price, which achieved a high of
US$90.75 per share in mid-2000, plummeted to less than $1 by the end of November 2001.[2] The U.S.
Securities and Exchange Commission (SEC) began an investigation, and rival Houston competitor Dynegy
offered to purchase the company at a very low price. The deal failed, and on December 2, 2001, Enron
filed for bankruptcy under Chapter 11 of the United States Bankruptcy Code. Enron's $63.4 billion in
assets made it the largest corporate bankruptcy in U.S. history until WorldCom's bankruptcy the next
Many executives at Enron were indicted for a variety of charges and were later sentenced to prison.
Enron's auditor, Arthur Andersen, was found guilty in a United States District Court of illegally destroying
documents relevant to the SEC investigation which voided its license to audit public companies,
effectively closing the business. By the time the ruling was overturned at the U.S. Supreme Court, the
company had lost the majority of its customers and had ceased operating. Employees and shareholders
received limited returns in lawsuits, despite losing billions in pensions and stock prices. As a
consequence of the scandal, new regulations and legislation were enacted to expand the accuracy of
financial reporting for public companies.[4] One piece of legislation, the Sarbanes-Oxley Act, increased
penalties for destroying, altering, or fabricating records in federal investigations or for attempting to
defraud shareholders.[5] The act also increased the accountability of auditing firms to remain unbiased
and independent of their clients.[4]
The International Business Machines Corporation (IBM) is an American multinational technology and
consulting corporation, with headquarters in Armonk, New York, United States. IBM manufactures and
markets computer hardware and software, and offers infrastructure, hosting and consulting services in
areas ranging from mainframe computers to nanotechnology.[3]
The company was founded in 1911 as the Computing Tabulating Recording Company (CTR) through a
merger of three companies: the Tabulating Machine Company, the International Time Recording
Company, and the Computing Scale Company.[4][5] CTR adopted the name International Business
Machines in 1924, using a name previously designated to CTR's subsidiary in Canada and later South
America. Securities analysts nicknamed IBM Big Blue in recognition of IBM's common use of blue in
products, packaging, and logo.[6]
In 2012, Fortune ranked IBM the No. 2 largest U.S. firm in terms of number of employees (435,000
worldwide),[7] the No. 4 largest in terms of market capitalization,[8] the No. 9 most profitable,[9] and
the No. 19 largest firm in terms of revenue.[10] Globally, the company was ranked the No. 31 largest in
terms of revenue by Forbes for 2011.[11][12] Other rankings for 2011/2012 include No. 1 company for
leaders (Fortune), No. 1 green company worldwide (Newsweek), No. 2 best global brand (Interbrand),
No. 2 most respected company (Barron's), No. 5 most admired company (Fortune), and No. 18 most
innovative company (Fast Company).[13]

IBM has 12 research laboratories worldwide and, as of 2013, has held the record for most patents
generated by a company for 20 consecutive years.[14] Its employees have garnered five Nobel Prizes, six
Turing Awards, ten National Medals of Technology, and five National Medals of Science.[15] Notable
inventions by IBM include the automated teller machine (ATM), the floppy disk, the hard disk drive, the
magnetic stripe card, the relational database, the Universal Product Code (UPC), the financial swap, the
RDBMS and SQL, SABRE airline reservation system, DRAM, and Watson artificial intelligence.
The company has undergone several organizational changes since its inception, acquiring companies
such as Kenexa (2012) and SPSS (2009) and organizations such as PwC's consulting business (2002),
spinning off companies like Lexmark (1991), and selling off product lines like its personal computer and
server businesses to Lenovo (2005, 2014). By late 2014, the Reuters news agency referred to IBM as
"largely a computer services supplier".[16]
PricewaterhouseCoopers (trading as PwC) is a multinational professional services network. It is the
world's second largest professional services network, as measured by 2014 revenues, and is one of the
Big Four auditors, along with Deloitte, EY and KPMG.
PwC is a network of firms in 157 countries with more than 195,400 people. It had total revenues of
$34.0 billion in FY 2014, of which $15.1 billion was generated by its Assurance practice, $8.8 billion by its
Tax practice and $10.0 billion by its Advisory practice.[5]
The firm was formed in 1998 by a merger between Coopers & Lybrand and Price Waterhouse.[1] The
trading name was shortened to PwC in September 2010 as part of a rebranding.[6]
As of 2013 PwC United States is the sixth-largest privately owned organization in the United States.[7]
The percentage of an industry or market's total sales that is earned by a particular company over a
specified time period. Market share is calculated by taking the company's sales over the period and
dividing it by the total sales of the industry over the same period. This metric is used to give a general
idea of the size of a company to its market and its competitors.
Out of total purchases of a customer of a product or service, what percentage goes to a company
defines its market share.
Definition: Out of total purchases of a customer of a product or service, what percentage goes to a
company defines its market share. In other words, if consumers as a whole buy 100 soaps, and 40 of
which are from one company, that company holds 40% market share.
Description: There are various types of market share. Market shares can be value or volume. Value
market share is based on the total share of a company out of total segment sales. Volumes refer to the
actual numbers of units that a company sells out of total units sold in the market. The value-volume
market share equation is not usually linear: a unit may have high value and low numbers, which means
that value market share may be high, but volumes share may be low. In industries like FMCG, where the
products are low value, high volume and there are lots of freebies, comparing value market share is the
The significance of market share: Market share is a measure of the consumers' preference for a product
over other similar products. A higher market share usually means greater sales, lesser effort to sell more
and a strong barrier to entry for other competitors. A higher market share also means that if the market
expands, the leader gains more than the others. By the same token, a market leader - as defined by its
market share - also has to expand the market, for its own growth.

How much market share is enough? Usually, gaining 100% market share is not a good idea, as the risk
associated with market actions, like fashion changes, product / use changes will impact the company
heavily. Also, the cost and effort to maintain 100% market share against nimble, local or more
aggressive smaller competitors can be very high and killing. Most companies decide on a target market
share beyond which the cost of acquiring marketshare is more than the profit from that incremental