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| THE ANDERSEN ACCOUNTING SHOW |
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| March 11, 2002 The legendary accounting firm ANDERSEN is in the news this morning. It is probably unfortunate for them for this story to break on the 6 month anniversary of the terrorist attacks of September 11, and the day after CBS ran an amazing documentary titled simply "9/11". The documentary was filmed by two French brothers and was started months before the unexpected attacks. In it they followed a new, probationary New York City firefighter. By total coincidence the man was assigned to a fire company which had a view of the World Trade Center and was in fact the first fire company on the scene. While tape rolled during a routine check for a smell of gas the first airliner flew over them - the camera and some of the firefighters actually watched the first hit. What followed was an hour or more of footage taken from within World Trade One and the nearby neighborhood between the fire station and the disaster site. It was obviously mind-boggling to watch. Speaking of mind-boggling, news this morning - one filled with sad ceremonies of rememberance of the terrorist attacks, sad rememberance of soldiers fighting and dying half a world away to protect world freedoms - of the Andersen company seeking to sell itself to one of the other remaing Big Five accounting firms is enough to bring forth another round of tears, this time as if from a crocodile. According to a New York Times News Service article, the sale talks got serious once Andersen found out it faced legal indictments over their obvious obstruction of justice in regard to Enron . Andersen has lost many of their best accounts since being openly disgraced; far from being a case of the rats leaving the sinking ship, it is a matter of even solid companies needing to distance themselves from the Andersen pall to protect themselves from fallout. If Andersen was in trouble after Enron, their huge presence in the recent Global Crossing bankruptcy pulled the plug. Face it, folks - the Andersen corporation ran a very questionable enterprise. They violated every bit of trust possible for their own employees, clients, Wall Street, and anything else you can name. Neither the Enron nor the Global Crossing fiascos could have happened at all if Andersen was an honest, impartial, legitimite accounting firm. Here is a direct quote from the NYTSE article: "Unlike most such negotiations, which turn primarily on price, the discussions are focusing instead on the enormously complex issue of how Deloitte {possible purchaser} can avoid assuming the legal and financial liabilities Andersen faces for its role in the Enron debacle." One might ask why Andersen is putting itself up for sale, and the answer is probably fairly complex. They do have a huge number of clients who can't just be dumped on the market and assimilated ovrenight by the others. They have a fairly large number of employees. And the smell of litigations is in the air... But think about this as their negotiations continue: whenever there is a major corporate sale or merger, the top people usually negotiate obscene presonal severance packages for themselves. There are never the "merger of equals", as employees are frequently told. When resulting layoffs occur it is the sold employees who take the brunt while their former upper management usually cashes out in style. In the case of a true "fire sale" like this one I would have to assume the top guys are taking care of themselves financially, especially since they should be facing one hell of a lot of legal bills, penalties, and some jail time. If I worked for Andersen and had known nothing about the shenannigans previously I'd have cleared off my desk, walked out the door, and gone to work for one of the competitors already.This is nothing more or less than Andersen leaders negotiating a profitable change of management. Contrast these maggots with the absolute horror of what happened on September 11, 2001, at the World Trade Centers in New York, and you have opposite ends of the human spectrum. Never forget, one might say; never forget - either vision of evil. |
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