Case Study of Arthur Andersen

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Business Ethics Decision-Making Cases Write-ups Arthur Andersen: Questionable Accounting Practices Name: Wen Jiangshan Student ID:2011008274 Part I. Summary of the case Case 2 mainly introduces how Arthur Andersen, who used to be one of the “Big Five” largest accounting firms in the United States, strayed away from accepted policies and stuck in a string of accounting scandals, finally closed its doors after 90 years of business. The firm’s name was synonymous with trust, integrity and ethics during a long period of time, however, Andersen failed to withstand the pressure from the competition of consulting service. Thus, it leaded to a negative influence on Andersen's corporate culture, which enabled…show more content…
|Failed to address serious accounting errors |Agreed to pay $110 million to resolve the | | |Andersen | |claims | | | |Company’s senior management aided and abetted | | | | |others’ violations of antifraud, reporting and| | | |Waste Management |record keeping provisions of federal |$20.5 billion losses to shareholders | | | |securities laws; $1.4 billion of overstated |11,000 employees were laid off | | | |earnings | | |3 | | | | | | |Assisted in the fraud by repeatedly issuing |Paid $220 million to Waste Management | | | |unqualified audit opinions on Waste |shareholders and $7 million to the SEC | | |Arthur |Management’s materially misleading financial |Was forced to promise not to sign off on | | |Andersen |statements

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