Enron, Arthur Andersen & Co.

["Tom Walker" <timework@xxxxxxxxx>]

From Today's Headlines in the New York Times

 

"A Tattered Andersen Fights for Its Future

Besides Enron itself, no company has been more seriously
wounded by its collapse than Arthur Andersen & Company,
one of the world's largest accounting firms."
http://www.nytimes.com/2002/01/13/business/yourmoney/13ANDE.html?todaysheadlines

 

The New York Times article predictably dwells on the prospects of uncovering "wrong doing" and misses the point. The point isn't that AA might have stepped over some fuzzy legal line but that the whole game of big time corporate accounting is predicated on clever evasions, some of which are unquestionably "legal" but only, of course, because the big five accounting firms lobbied vigourously to have them accepted as "standards."

 

It will be interesting to see how this one plays out. One's inclination is to expect damage control. But it also seems to me that the stakes are too high for damage control to be blithely accepted by all the players. According to the background piece in an NYT story on Enron, Lay originally was thinking of the name "Enteron" until someone told him it meant intestines.

 

Tom Walker