Wherever the name Arthur Andersen & Co is known, it is equivalent to integrity, honesty, and service, he eulogized. To me (Mr Andersen) stands as a representative of principles as opposed to expediency. One thing everyone did know, and without any doubt about it, Mr Andersen could not be bought.
On August 31, Arthur Andersens bread-and-butter business the auditing of public companies will have a less ceremonious ending. Little talk of integrity, apart from a hark back to its golden days, will mark the day for Andersen, which has become a disgraced player in the Enron Corp scandal in the eyes of the public.
The accounting firm is barred from auditing public companies after Saturday, since it was found guilty in June of obstructing Justice in the Enron investigation after choosing to fight an aggressive US Justice Department.
Though it officially marks the end of Andersens audit practice, the August 31 date is mostly symbolic. Most former partners and employees bitterly regard March 14, the day the Justice Department indicted the entire firm for its role in the Enron debacle, as the day Andersens demise was really set in motion. Its a sad day for all of us, said Duane Kullberg, who retired as Andersens chief executive in 1989, mentioning a speech he made in 1987 on integrity. It was a firm that really took the lead in the profession and establishing it.
Since then, the firm that boasted of its 85,000 employees in 84 countries and over $9 billion in revenue last year, has shrunk into a hollow shell of its former self. The US branch of its network, Arthur Andersen, is said to have less than 3,000 staff on its payroll and has lost 1,199 of its publicly traded audit clients since the start of the year. Most workers and overseas units have defected to rival firms, and its profitable units such as its consulting arm have been sold.
Andersen insists it wont dissolve or file for bankruptcy after shuttering its public auditing business, though it refuses to spell out its plans. A skeleton crew, including the four-member administrative board in charge of the firm, must oversee the mundane tasks of winding down such as getting rid of art work and terminating office leases, while battling a slew of lawsuits.
The fate of the numerous Andersen offices across the US varies. Retired Andersen partner Robert Baxter visited his old Andersen office in Philadelphia recently, only to find nothing had changed except for a KPMG LLP sign on the door. KPMG had acquired Andersens audit and tax group in that city.
Other offices, like the Atlanta office, have been shut down, with nothing more than a cleaning crew and office furniture movers left behind.
Art conservation firm Ponsford Ltd held a three-day sale in Atlanta earlier this month to liquidate the art collection from Andersens offices in the Southern region, valued at $3,00,000 to $4,00,000.
The sale of Andersens paintings and a few abstract sculptures in Italian marble drew a flock of curious art collectors and former Andersen employees and business associates, said Gordon Ponsford, the firms CEO.
A surgeon from Dallas pocketed one of the most sought-after paintings for $25,000, a Benberns oil on canvas of the North Georgia landscape, he said. (Reuters)