Say you have a dog, but you need to create a duck on the financial statements. Fortunately, there are specific accounting rules for what constitutes a duck: yellow feet, white covering, orange beak. So you take the dog and paint its feet yellow and its fur white and you paste an orange plastic beak on its nose, and then you say to your accountants, "This is a duck! Don't you agree that it's a duck?" And the accountants say, "Yes, according to the rules, this is a duck." Everyone knows that it's a dog, not a duck, but that doesn't matter, because you've met the rules for calling it a duck.The failures of Enron are retold in The Smartest Guys in the Room. In short, Enron was a utility that was taken over by people who didn't want to run a utility, so they used the utility's access to capital to borrow billions of dollars which they spent on businesses that didn't pan out. Running a multi-billion dollar business into the ground is bad enough, but they compounded their problems by artificially converting their investment dogs into happy, quacky ducks. As long as they had access to capital, the fraud would remain hidden, but then the market collapsed.
It's like going to work every day with your hair on fire and nothing to put it out with but a hammer."
The good thing is that the book covers some of the accounting shenanigans; although the coverage is sparse, one can derive a basic understanding of how it all fit together. The worst part is that you have to read about a bunch of people who didn't pay attention to the details of running a business, and consequently ran that business into the ground.