Unethical Practices of Arthur Andersen

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Submitted By amberlp1985
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Unethical Practices of Arthur Andersen
1.) I think that Arthur Andersen contributed a lot to the Enron Disaster. I think that it all started when AA became its own company. Because of this, the two companies became rivals. AA’s main focus was on revenues. The company did not care how things were done as long as it put money in their pockets. Also, from what I understand, the company made the auditors feel that if they were to say anything that would make the company lose a client, then the auditor would lose their job. Auditors are there to make sure that things are being run ethically. The risk of getting in trouble by their employer blurred the line between what is right and what is wrong. Another thing that I feel like was a huge contributing factor in the Enron disaster was the approval of Special Purpose Entities that were used to generate false information. These entries were used to cover the truth of what was going on in the company. This is extremely unethical. It sounds to me like the integrity of the company went downhill after the split.
2.) I feel like most of the decisions that were made by Arthur Anderson were faulty. They were negligent in almost every decision they made. One of the biggest things was the special purpose entries which were used to cover the truth of what was going on in the company. Lying to make a company look better is extremely unethical. An investor might look into the company and want to invest because of great profits and really the company is not making any money at all. Their decisions to override what auditors were saying were faulty too. Had they put more interest in making sure the auditors could do their jobs and not only focusing on making money the company might still be around today.
3.) An auditor should make decisions based on what is best for the public interest rather than what is best for the management or…...

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