Fall of Arthur Andersen

Arthur gave a lot of importance to ethical values and insisted on honest accounting and the elimination of conflicts of interest in accounting the firms. During the late 1920s, because of the depression in the US economy, many investors lost faith in companies.

Reportedly, Andersen, under the leadership and guidance of Arthur, was instrumental in restoring the faith of US investors in companies based on its integrity and high professional values. Arthur also focused on creating a firm with its own set of business standards. His emphasis on 'Arthur Andersen specific' business standards evolved into the concept of 'One Firm' over the years.

Such consistency in offering services and quality was achieved by imparting rigorous training to all new recruits. The training sought to help new recruits imbibe the Arthur Andersen culture, popularly known as the 'Andersen Way.' After Arthur's death in 1947, Leonard Spacek (Spacek), a partner in the firm, became the CEO. By the early 1950s, the culture of ethics and honesty was so deeply ingrained in the firm that the firm was elected to the Accounting Hall of Fame of Ohio State University in 1953. In the early 1950s, realizing the potential of technology, especially computer technology, Andersen began investing in the same. By the mid-1950s, Andersen was offering consultation and installation services through its new Administrative Services Division...