Arthur Andersen was a reputable accounting firm based in Chicago handling auditing, tax, and consulting services for top dollar corporations. In 2001, Arthur Andersen was involved in the Enron scandal which resulted in their suspension of their licenses to practice as Certified Public Accounts. Currently Arthur Andersen is recovering from this setback, and trying to regain their reputation and rebuild their clientele. In order to maintain business practices this companyÃÂs management should focus on issues regarding legal, ethical, and social responsibility. Arthur Andersen dishonored its legal, ethical, and social responsibilities by throwing out the principles of the Independent Auditor.
The most known case would be Arthur Andersen LLP v. United States in which the company was found guilt of obstruction of justice by destroying evidence relating to Enron. Even though the decision was overturned, as a company Andersen is relatively finished. According to the BBC News (2002), ÃÂmany of Andersen's high-profile audit clients, fearing that association with the accountant could taint them in the eyes of their own shareholders, took their business elsewhere.ÃÂ
When people think whether or not to do business with an accounting firm they look at them both legally and ethically.
Ethical issues have also impacted Arthur Andersen as how they are looked at by potential clients. Ethical accounting is how Arthur Andersen was first ran but greed stepped in the way. Brown & Dugan (2002), state that ÃÂAndersen's descent from conscience of the accounting industry to accused felon didn't happen overnight. Rather, it stemmed from a series of management miscues and compromises over the decades.ÃÂ When Arthur Andersen first started his company he put reputation over profit. Brown & Dugan later go on to inform the readers that Andersen once said ÃÂthat there was "not enough money in the city of Chicago" to approve a peculiar...