Word: arthur
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Accounting firm Arthur Andersen had already been found guilty in the court of public opinion, and paid a heavy penalty. Clients deserted; employees fled. In fact the Chicago firm was barely alive, but one question remained: What would its epitaph be, the lesson for others? An answer came last Saturday, when a Houston jury found Andersen guilty of obstructing justice. It provided a moment of vindication for investors who lost more than $60 billion in the spectacular collapse of Enron, whose books had been audited by Andersen. But the verdict held a twist: at first the case seemed to hinge...
...Exchange Commission was starting to scrutinize Enron's books, Temple told David Duncan, who supervised the account, to remove her name from a file memo that disagreed with Enron's characterization of a $1 billion loss as "non-recurring." Said prosecutor Andrew Weissman: "This is a perfect example of Arthur Andersen sanitizing the record so the SEC would have less information...
Even an acquittal would probably not have saved the firm. "The verdict doesn't matter anyway," says Arthur Bowman, editor of Bowman's Accounting Report. "Arthur Andersen is dead. Once the indictment was handed down, clients started jumping faster than they did off the Titanic." A third of the firm's 2,300 clients have jumped ship; the top clients are gone, and parts of the company have been sold off. About 5,000 of the 26,000 U.S. employees remain...
...corporate America falling apart? Each day brings sordid details of dirty dealings at the highest levels of what were once our most respected companies. The sleaze at Enron and Arthur Andersen shocked us. Now it's Tyco's turn, and it won't be the last...
...CONSULTING FEES CORRUPT CORPORATE AUDITORS The accounting firm Arthur Andersen earned $54 million a year in fees from Enron, making about as much for auditing the books as it did for consulting work. Andersen basically blessed its own advice. And guess what might have happened to those consulting fees if Andersen had stood up to Enron over questionable bookkeeping? The auditing and consulting functions should be performed by separate firms, and auditors should be replaced every three years. The U.S. should also move to "principles based" accounting standards like those in Europe. America's "rules based" approach, known as GAAP...