Arthur Andersen (A): The Waste Management Crisis Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

The instances describe the passing of Arthur Andersen, a firm that had set the industry standard for professionalism in auditing and accounting. Once a case of strong corporate culture with a dedication to public service and integrity that was independent, Andersen saw its traditions and standards weaken as it shifted its style of governance and grew explosively. The (A) case describes a disaster precipitated by the admission of Waste Management, a leading Andersen customer, that it overstated its pretax earnings by $1.43 billion from 1992 to 1996. The ensuing Securities and Exchange Commission (SEC) investigation finished with Andersen paying a $7 million fine, the largest ever levied against an accounting firm, and agreeing to an injunction that effectively placed the bookkeeping giant on probation. Students analyze the causes of Andersen's difficulties and advise Andersen leaders.

When Enron's aggressive usage of off-balance sheet ventures became impossible to conceal in fall 2001, news reports stated that Andersen auditors associated communications with Enron and had participated in extensive shredding of draft files. Pupils are requested to act as crisis management consultants to Andersen CEO Joe Berardino. The (C) case details Andersen's fall following its indictment and conviction on criminal charges of obstructing justice in the Enron case. Its conviction was later overturned by the U.S. Supreme Court on narrow technical grounds, but by then Andersen had ceased to exist, eighty-nine years after Arthur E. Andersen had taken over a small accounting firm in Chicago. Students may focus on the impact of media on a reputational catastrophe.

PUBLICATION DATE: October 10, 2011 PRODUCT #: KEL558-PDF-ENG

This is just an excerpt. This case is about FINANCE & ACCOUNTING