| Arthur Anderson used to be one of the Big 5 accounting firms along with Deloitte and Touche, KPMG, Price Waterhouse and Ernst&Young. I was briefly at an Indian subsidiary of EY(those days, the Big 5 weren’t allowed to operate by themselves without partnering with a local chartered accounting firm) because only certain firms could do bank audits and I wanted the experience at one if the Big 5. KPMG was known for its entertainment industry accounts. I picked E&Y for manufacturing and I think I ended up with an international cement conglomerate account. The Big 5 clearly decided who gets what industry. They operate like a cartel. They also had consulting divisions. AA after Enron simply focused solely on consulting and IT. They are all ‘special’ kinds of hell. Just different flavors. AA/Enron scandal was a big deal and was the only talk for days and days and days. Slightly dated.. 2018: https://riskmagazine.nl/article/2018-03-19-how-the-big-five-... [..] Andersen was responsible for checking the accounting of energy company Enron. The energy company went down with great noise because of shoddy accounting. Trouble came for Andersen as they had approved this accounting. After learning the Securities and Exchange Commission had begun an investigation of Enron’s accounting, orders were given at Andersen to destroy thousands of documents and e-mail messages. These illegal acts resulted in a conviction, which made it impossible to act as a public accountant for American stock exchange funds. Andersen decided to hand in its licenses before the SEC would withdraw them.[..] [..] On appeal for the destruction of the files, Andersen was acquitted and there was no formal objection to the continuation of the audit practice. However, almost all employees had left due to the obscure practices. The practice had changed hands and the name would always be linked to this scandal. The few employees that stayed, worked on litigation arising from past audits, as well as pension issues and few other matters. Also there still is another firm which reminds us of the existence Andersen, namely Accenture. Accenture started off as the consultancy part of Andersen, which split off just in time, before the scandal happened.[..] |