Arthur Andersen Research Paper

Today, Arthur Andersen & Co. is notoriously known for its’ unethical behavior of collusion with Enron, leading to thousands of hard working Americans losing millions of dollars. This type of behavior shows how far Arthur Andersen & Co. has strayed from its original foundation of honesty and integrity, instilled in it by the founder and senior partner Arthur E. Andersen. Originally named Arthur, DeLany & Co. in 1913 then soon changed to Arthur Andersen & Co., Andersen sought to challenge the status quo of the public accounting system. Andersen continually forged new ways of serving his clients, training his employees and growing his company. Using the motto “Think Straight-Talk Straight,” Andersen challenged traditional accounting practices

Born in 1885 to two Scandinavian immigrants, Anderson and his seven siblings soon became orphans due to the premature death of their parents (Moore, 72). Soon after his fathers death in 1901 Andersen began his work career as a mail-boy for Fraser & Chalmers Manufacturing Company. Anderson would work during the day and attend high school classes at night. In 1908 Andersen became the youngest Certified Public Accountant in the state of Illinois and accepted a job at Price Waterhouse and Co. as a senior accountant. The next year Andersen was invited to teach night classes at Northwestern University while he worked during the day. Then in 1912, at the age of 27, Andersen became professor and head of the accounting department at Northwestern. He held this position for over a decade after the founding of Arthur Andersen & Co. After a brief stint as controller at Schlitz Brewing Company Arthur Andersen opened his own accounting office in Chicago with his partner, Clarence DeLany, soon called Arthur Andersen & Co. During the twenty-fifth anniversary party of Arthur Andersen & Co. Andersen’s managing partner, Charles Jones, describes the company’s success saying,

’From an inauspicious beginning has grown a truly great accounting organization, ranking foremost among the leading firms of the world as to character and reputation, known internationally, possessing a most imposing list of clients, operating in every state

He believed all accountants should be trained on the principles of economics, finance and organization. This was an idea new to the accounting industry that previously just wanted merely high-grade accounting technicians. To accomplish this ‘one firm, one voice’ philosophy Andersen established training classes as part of regular working hours for his employees. One training program he required for all employees and that is still going strong today is called FASTS (Firm-wide Audit Staff Training School). FASTS had the goal of brining all new employees up to speed under uniform training. Equally candid and relentless was his demand that the accounting profession establish uniform principles and definitions for itself rather than relying on the government to do it (Moore, 79). Anderson’s idea helped lead to the beginnings of what is known today as the Committee on Professional Standards. Another example of Andersen’s progressive ideals came when an employee fainted at their desk from exhaustion. From this Andersen decided to initiate a five-day workweek including overtime pay. Up until this time no other accounting firm offered overtime pay. Once Congress passed the Wage and Hour Law in 1938 Andersen found that he had already voluntarily adopted these policies years