This Fortune magazine article reveals the methods by which Enron was able to fabricate operating cash flow and profits.

"The device they used was called a prepay; in essence it was a loan that Enron booked as operating cash flow." Basically, Enron would agree to deliver natural gas or oil to an offshore entity that was set up by one of a number of banks that dealt with Enron. The offshore entity would pay Enron upfront for the promise of future deliveries and then turn around and promise to deliver natural gas or oil to the bank. Then the lender would agree to deliver the same natural gas or oil back to Enron. This all looked like separate transactions in the financial statements, but the trades of natural gas or oil cancelled each other out, basically leaving Enron with a loan with interest.