Accounting expert says Enron quarterly reports were accurate

HOUSTON -- Last-minute changes to quarterly earnings reports that prosecutors contend were ordered by Enron Corp. chief executive Jeffrey Skilling to improve the company's reputation on Wall Street were accurate, and not the result of improper tapping of company reserves, a defense expert testified yesterday.

''The whole process of financial reporting, in a company as large as Enron, to get financial statements out . . . is an enormous undertaking," said Walter Rush, an accounting expert hired by Skilling. ''And people are scrambling, trying to get these estimates put together.

''There are changes going on up to the very last second. It is universal. Every company goes through this."

Rush was the second consecutive accounting expert to take the stand, following University of Southern California professor Jerry Arnold, who testified for Enron founder and former chief executive Kenneth Lay in the 14th week of their federal fraud trial.

US District Judge Sim Lake said yesterday he wanted testimony and rebuttal witnesses finished no later than the end of next week, and tentatively set reading of his charge to the jury and the start of closing arguments for May 15. Defense lawyers would make their final arguments the following day, with prosecutors getting the remainder of their closing time on May 17. The case would then go to the jury.

Mark Koenig, former head of investor relations at Enron, testified early in the trial that he believed top Enron executives were so bent on meeting or beating earnings expectations to keep analysts bullish on the company's stock that they made or knew of overnight changes to estimates.