Andersen Case - Enron

The demise of Andersen was manipulated by many elements from both Andersen itself and external. From inside factors Anderson’s great willingness of success made it blind to the reality, resulting in higher potential risk elements. About more than 100 members in higher management position of Enron come from Anderson made the profession nearly no independence. In addition, there are many external factors from the government, other big four companies and Enron. The government over controlled and maintained some interests relationship from Enron. It pushed the public focusing on the mistake of Andersen of destroying the paper works and ignoring the focus of fraud. Other big four companies were eager to breaking down the competitor, obtain the clients from Andersen and incrasing its own market share. Last but not least, Enron hided the SPE to exaggerated revenue, profits and tax benefits also contributed the death of Andersen.

1. Being the youngest CPA in Illinois, Arthur Anderson founded his own accounting firm Arthur Anderson & Company.

• Throughout Arthur Anderson’s life, “Think straight, talk straight” served as a guiding principle for himself and Arthur Anderson & Co., the accounting firm that he founded.

• Arthur Anderson’s reputation for honesty and integrity resulted in Arthur Anderson & Co. gaining stature in the business community and growing into one of the nation’s leading accounting firms by the time of his death in 1947.

• Leonard Spacek succeeded Arthur Anderson as managing partner of Arthur Anderson & Co. in 1947 and continued Anderson’s legacy of lobbying for more rigorous accounting, auditing, and ethical standards for the public accounting profession.

• By the time of 1973, Arthur Anderson was one of the largest and most prominent accounting firms worldwide.

• The engagement with