Professional Documents
Culture Documents
Andersen
Andersen
Andersen
INTRODUCTION
Evolution of a large organization on the basis of integrity and adherence to professional standards
The importance of ethics, integrity and professional standards in the audit business. The need to balance economic and social benefits in corporate decision making.
GRACE TO DISGRACE
In March 2002, Andersen , one of the world's leading audit firms, was indicted by the US Department of Justice on charges of obstructing the course of justice in the Enron case DOJ had begun a criminal investigation into Andersen in January 2002 in connection with the Enron case DOJ's investigation revealed that Andersen had deliberately destroyed crucial documents relating to Enron during OctoberNovember 2001 Through the late-1990s, Andersen's name had figured prominently in various instances of business fraud by its clients, namely, Sunbeam, Waste Management Inc., Quest Communication, Global Crossing, and Baptist Foundation of Arizona.
THE AFTERMATH
In August 2002, Andersen Worldwide, the parent company of the USbased Andersen, agreed to pay claims worth $60 million to Enron shareholders and creditors (against claims of over $25 billion) Andersen Worldwide also stated that it was not responsible for the deeds of Andersen (US), as Andersen (US) operated as an independent division In October 2002, Andersen received the DOJ verdict: the firm was given the maximum court sentence (in such cases) of five years probation on its US operations and a $500,000 fine for altering evidence of its Enron work..