Here's a ... ... Phil McGraw ... top partner at Arthur Andersen who was ... in covering up Enron's ... woes. He asks, "How is the Enron ... working for
Here's a hypothetical situation. Phil McGraw cross-examines top
partner at Arthur Andersen who was instrumental in covering up Enron's
financial woes. He asks, "How is the Enron situation working for you?"
Top partner answers, "Fine."
Let's get real. Arthur Andersen LLP is fighting to remain in business
-- and so far the battle is going strong. The Big Five service
company, known as the Cadillac of professional firms, is working around
the clock to resolve possible criminal charges but as it stands right
now, the verdict has come in. A federal grand jury has indicted the
Andersen accounting firm, charging it with obstruction of justice, the
first criminal charge brought in the scandal surrounding the collapse
of energy trader Enron Corp. The firm vows to fight and is also
negotiating a sale of some or all of its operations to KPMG, Deloitte
Touche Tohmatsu or another competitor. In addition, the firm is trying
to unflinchingly stop a stream of client defections; those who have
already left include Merck, Federal Express, Sara Lee, among dozens of
others. Separately, UtiliCorp United Inc., the third-largest remaining
U.S. auditing client for Andersen is continuing to retain them. All in
all though, it's been a terrible time for the accounting giant - and it
isn't over yet.
What are the chances for survival for Arthur Andersen LLP? I'd say
pretty good.
Andersen has been looked upon as a public guardian, setting the
standards for all involved. After its involvement with Enron, their
reputation may be tarnished but not beyond repair. We all mistakes but
it doesn't mean that's who we are. We have to correct our mistakes,
learn from them and move on. The end result is that it makes us
stronger but you can't get stronger if people don't allow you a second
chance as in the case with the Justice Department's action against
Andersen, not to mention clients running off scared.
Haven't we all experienced moments in our lives when we have been put
to a test and don't know what to do? For example, you are a dutifully
employee yet get fired because you expose that the chief operating
officer is an alcoholic. You could have kept your mouth shut and
maintained your job but something inside you kept saying, "I cannot
stand another day of this abuse," and you act on it. Others, in the
same position might hang on with tight-lip for fear of losing their
job. Who is to say whose reaction is right or wrong? Or, perhaps you
are CFO of a publicly-traded company and are fully aware that the
company's sales projections are inflated. You do your best to navigate
your way through it. You start complaining and pretty soon you can't
stop. Out you go -- voluntary or involuntary. Mistake? How can one
judge until after the fact? Or, the value of your stock options is
tied to how much you sell for the company. Ever thought about pushing
the envelope to fabricate sales? Some do, some don't. Where do you
draw the line? Time to pause for a moment and ask yourself that very
same question. If you don't, Dr. Phil will.
You should hold firmly to your values, integrity and morals. If you
can't, then walk. If you decide to stay, as in the case of Andersen
employees, then be prepared to risk it all. At some point, you will
have to come clean, admit mistakes and bare the consequences.
Bankruptcy offers one possible solution to the Andersen problem. This
might make it simpler for one of the other Big Four to acquire its
business. It seems only natural that anti-trust concerns might be
waived in the event of a bankruptcy. So if Andersen declares
bankruptcy, which they have indicated they have no plans to do so, this
might pre-empt any regulatory concern about anti-competitive mergers.
I look at it this way. If actor Tim Allen can serve time in prison and
later come back to churn out a best-selling book and televison show,
then Arthur Andersen can surely survive over the long haul. And Dr.
Phil McGraw might add, "Now, you are getting real."
Global Revolution: Find the Right Overseas Partner
Dream of seeing your product in stores around the world? Unless you have years of ... ... you'd be wise to find some overseas ... ... your ... with foreignUnleashing the Powerhouse Businesswoman Within
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