DEATH of Aurther ANDERSEN

CNN | March 13th | LOU DOBBS

[Roger_W_Isom]

LOU DOBBS is reporing that ERNEST YOUNG one of the TOP FIVE ACCOUNTING FIRMS HAS REFUSED TO ACQUIRE AA!!!!! This is NOT good NEWS!!!! if YOUNG refuses to accept AA offer to sell itself to YOUNG that means only one thing FOLKS!!!!

AA is in FAR more seious shape then we realize and we could be looking at the other accountting firms REFUSING TO ACQUIRE AA as early as Mid April!!!!

[xeno]

...Andersen's hubris was something special, an order of magnitude greater than the others...

Enron's hubris was something special, an order of magnitude greater than the others in the energy industry. How poetic that they crash and burn together.

[VA Advogado]

AA has attempted to find an insurer to insure a buyer against liability stemming from AA's past activities. The financial press is reporting that all insurance companies have turned them down.

Well I would hope so. Do you know ONE insurance company that insures against PAST activities?

[I'mAllRightJack]

AGREED. I expected their immediate OBIT from day 1.

[Leisler]

Yeh, and there where a lot of good Germans. Too bad about the Nazis. But that is the nature of large, warm, fuzy organizations. You're rice bowl is full untill the stuff hits the fan, and then it's a crying game about how your pencils were always sharp and your desk clean.

[KC Burke]

Oh, I don't feel you are picking on me. You, in fact, confirm many of my points. AA is little different from most of these big firms. Their crucifiction will solve no problems, just put 90,000 employees through a profoundly difficult time. The placement of the crucifix on the roadside will serve as a warning to their peers, but it won't really stop criminal and unethical practices in businesses they work for. Man is Fallen, as we, as true conservatives, understand.

Law, the limitation of Arbitrary Power, the small and limited government...these are the answers. I would prefer the civil courts and liability protecting the public compared to the likes of Tommy Daschle and Big Government Regulation.

We see the Federal balance of US Justice Department buzzard and SEC buzzard circling a fat injured animal each wanting a good meal but with their eye peeled for each other. I'm not on the side of the buzzards even though I've seen that poor animal as critcally injured (by its own stupidity) for some time.

[evolved_rage]

Do you know ONE insurance company that insures against PAST activities?

The gubmint.

[EverOnward]

Re your Post 32

You are very talented with curses. Bravo.

[VA Advogado]

LOL true, but then they can extract a virtually unlimited supply of cash from its 'shareholders'.

[GovernmentShrinker]

Actually there are insurance policies written in some (perhaps many) acquisition situations, to cover liability for past actions which come to light after the acquisition (and sometimes also for as-yet-unquantified liability for actions already discovered). Usually the level of risk is considered acceptable, and the insurer is free to charge pretty exorbitant premiums for this type of policy, even with "deductables" which may be in the 10s or 100s of millions, as it's all being rolled into the financing of the acquisition, and essentially being deducted from the purchase price of the acquisition.

However, with AA's recent history, apparently all the insurance companies which underwrite this sort of policy felt that the risk was great that more large-scale liability situations would come to light down the road -- not to mention that the liability for the Enron and Global Crossing situations isn't even close to being quantifiable yet. If any were willing to seriously discuss underwriting a policy at all, it was in a price range which would have exceeded what any potential acquirer was willing to pay for AA, thus rendering the policy useless for its intended purpose.

[gohabsgo]

Yeh, I feel for the worker bees, they're the ones who always get reamed. As for for lying, self-serving, two-faced turd burglars in the 5% of the company, the low lifes who knew they were risking the reputation of a once-respected company...the same one's who took millions to look the other way, squirrling away millions in off-shore accounts...this is the Arthur Anderson we'll all remember.

[elfman2]

"but those failures need not have taken down the entire corporation and thrown a whole bunch of people out of work. "

After 5 years of IT consulting with Ernst & Young, I think that the whole consulting/accounting industry and its incestuous, almost parasitic, relationship with the economy desperately needs a shakeup exactly like this. These big 5 firms are a monstrous financial cost the healthcare industry in which I worked. There are many reasons that they exist, but I think that providing a valued service is dwarfed by the other reasons like risk sharing, political cover, favor trading, executive incompetence and insecurity.

[elfman2]

" Overall I believe they are probably third or fourth of the Big Five."

Overall Ernst & Young was #1 in the world, and #2 in the US in 1998 measured by number of employees. (Anderson was #1 in the US.)

[Liberty Ship]

Well,.....bye. -- Curly Bill.

[the]

Posting these until someone laughs!

[elfman2]

"[Anderson] was probably the most prestigious, and it certainly was the most arrogant. "

Big time! They are also the most demanding of their staff. While with Ernst & Young I worked under a Vietnam War chopper tail gunner who became a partner in E&Y Healthcare IT. He said that after his discharge he was approached by Anderson. He told them that after 4 years in the Army he'd be damned if he'd join the Marines.

I had limited experience with them, but I understand than they tend to be very structured in their methodologies and discipline in IT. (Which is of course very good for very large projects.) One client that I worked with disparagingly called them Anderson Androids.

[the]

What Dada is.

[VA Advogado]

And you know all this how?

[cricket]

"Am i missing something?"

. . .about 85,000 employees. . .

[Steve Eisenberg]

Even if AA does manage to get acquired, this demonstrates the self-correcting nature of capitalism. Provide bad goods or services, and down you go. There is no need for more government regulation of accounting.

As for the AA workers, they may need to move, but the work they used to do will still have to be done by someone. The rise of fall of companies is characteristic of our system.