IN DEPENDENCE OF AUDITOR – ENRON AND ARTHUR ANDERSEN CASE Introduction The world economy in recent years has got some significant growth but also had quite serious scandals. They caused the shakes for many‚ both citizens and authorities. Therefore‚ it is a challenging time and it is the time for change. An absolutely necessity is to enhance the true reliable financial information because the success on the capital market depends on it. The key factor is to assure that auditors must take a completely
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Case 5: Arthur Andersen: Questionable Accounting Practices April 28‚ 2012 Case 5: Arthur Andersen: Questionable Accounting Practices Describe the legal and ethical issues surrounding Andersen’s auditing of companies accused of accounting improprieties. Arthur Andersen LLP (Andersen) was involved with several legal and ethical issues regarding several of their clients being accused of accounting improprieties. Andersen may not have been directly involved with most of these improprieties;
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Individual Project Capstone Case Study – Arthur Andersen LLP Bus 680 – Economics for Business Decisions Summer 2013 1. Discuss the environmental‚ strategic and organizational changes that occurred over the life of Andersen in the context of figure 11.1. While Andersen started off as a stable environment‚ once changes started being made to the main focus of the company many changes were expedited. While still successful in it’s auditing business‚ other opportunities arose that allowed for quicker
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Examining the Failure of Arthur Andersen Hester Rall LDR 531 November‚ 28 2011 Tom Melpolder Examining the Failure of Arthur Andersen Introduction Organizational Behavior (OB) is the study of an organizations individuals‚ groups and structures and its impact on workplace behavior (Yukl‚ 2010). In reviewing the failure of the storied Arthur Andersen (AA) accounting firm we see the influence of individuals’ decisions‚ particularly that of its leaders‚ but also the lack of individual accountability
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the Demise of Arthur Andersen The planning function of management is critical to the success of any organization. Innovative ideas‚ perfect products‚ and highly skilled employees fail to become assets if no plans are in place for how these assets will be used to achieve the organization’s goals. In the case of the once‚ highly successful accounting firm‚ Arthur Andersen‚ management’s failure to plan effectively for crises led to its demise. Management Planning at Arthur Andersen In today’s business
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such as: Accounting Irregularities at WorldCom and Arthur Andersen…No More: What Went Wrong? (Business Ethics 4th Ed: Cases 5 & 6 pg.101-109)‚ both clearly present various moral and ethical problems that arise that are real life business scenarios as well as question the impact of certain ‘special’ duties/obligations that apply to particular individuals and employees who choose to engage in these activities in the organization leading to their downfall. The WorldCom case and scandal occurred because
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Case Analysis Arthur Andersen: Questionable Accounting Practices ●Introduction Arthur Andersen LLP‚ which is over a span of nearly 90 years‚ would become one of the "Big five" largest accounting firms in the United States. Moreover‚ the accounting firm seen as the symbol of trust‚ integrity and ethic. The good reputation is derived from the advent of consulting business‚ which was developed by Leonard Spack. However‚ with the growth of consulting services‚ many accounting firms viewed it as a
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1) What did Arthur Andersen contribute to the Enron disaster? Arthur Andersen (AA) contributed to the Enron disaster when it has failed to the management by failing to have Enron establish and enforce its own internal control. There has been flaws to AA‘s internal control. There has been assumption that AA partners were too motivated by revenue recognition thus‚ overlooking several criteria when providing their services to Enron. Additionally‚ AA also recognised the retention of audit clients
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employees succeeded in destroying over thirty thousand documents before being subpoenaed by the SEC‚ predictably hindering the investigation. During May of 2002‚ Arthur Andersen LLP was finally indicted on charges of obstruction of justice by the Southern Texas District Court‚ served by Michael Chertoff. The jury believed that Arthur Andersen and its employees were in violation of 18 US Code § 1512‚ a public law which covers “tampering with a witness‚ victim‚ or an informant”5‚ due to the mass destruction
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following ethical and legal standards. The purpose of this paper is to discuss the legal‚ ethical‚ and social responsibility of Arthur Andersen. This paper will also analyze three factors that influence Arthur Andersen ’s strategic‚ tactical‚ operational‚ and contingency planning. The term ethics must first be defined to understand a few of the issues involving Arthur Andersen. According to Wikipedia‚ the term Ethics is a set of principles of right conduct‚ a theory or system of moral values. When a
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