Final Accounting: Ambition, Greed, and the Fall of Arthur Andersen

by Barbara Ley Toffler and Jennifer Reingold

Book Overview

Sheds new light on the questionable practices and attitudes that led to the financial scandals at Enron and other corporations, the accounting fiascos at Global Crossing and WorldCom, and the collapse... This description may be from another edition of this product.

• Format: Hardcover
• Language: English
• ISBN: 0767913825
• ISBN13: 9780767913829
• Release Date: March 2003
• Publisher: Broadway Books
• Length: 288 Pages
• Weight: 1.18 lbs.
• Dimensions: 1.0" x 6.3" x 9.7"

Customer Reviews

Cut AA --Paste E & Y

I can tell you that this is the story not just of AA but of E & Y...and I suspect the others may not be far behind. I admire the author for her willingness to take all this on. She writes a good history of the in-fighting with the SEC and the AICPA. The top guys in these firms have forgotton that they are accountants and have left their profession behind for GREED. I worked hard to become a CPA and I worked hard once I became a CPA but I left because it is not a profession- it is GREED. The author spells it all out. This book should be required reading in business schools but then who would become an accountant. PS...the story is not over. Hopefully, someone will write the next chapters. Where did all the AA partners go? Well, the biggest majority went to E & Y....the story continues.My thanks to the author.

Lessons for a capitalist society . . .

More on the corporate ethics scandals! There is much to be learned about the slippery slope of situational ethics in this book. What is compelling is that Ms. Toffler tells all, including her own shortcomings, after her realization that she had started the slide down that slope! Ms. Toffler writes in a straightforward, no holds barred, manner that keeps one's interest even as we shake our heads in amazement at the missteps, greed, and self serving actions of these supposed watchdogs of the public interest. And, personally, I read this book with a profound sadness to realize that the great company founded by Arthur Andersen, with unassailable principles and a sense of public duty had come finally to this terrible end. Of her years as a consultant, Ms. Toffler says, "one important thing I've learned is that most people do not want to do unethical things. Usually, unethical or illegal behavior happens when decent people are put under unbearable pressure to do their jobs and meet ambitious goals without the resources to get the job done right." Her conclusion from her years at AA is that it's not the bad apples that cause the problems, it's the rotten culture. When an organization's leadership team takes their eye off the reason for the organization's existence (to provide a useful service or product to the consumer), and begins focusing on profit to the near exclusion of other values, then the inevitable slide to extinction begins. One cannot help but to wonder how we can possibly effectively change our corporations to provide the greatest happiness for the greatest number of people when some of those stakeholders (investors in particular) insist on short term gains versus building enduring organizations. Finally, Ms. Toffler offers hope - lots of hard work, but some hope. Starting with what she knows best (corporations) she advises that we: (1) accept the appropriate level of regulation on our public accountants and client organizations (Sarbanes-Oxley as an example is a good start, but needs to go further); (2) change executive compensation to better balance the short term goals with building an organization to last; (3) rethink the structure of the CPA firms - partnerships don't work here; (4) know the true client - who really is the end user and are you serving their best interest; (5) limit the perks and goodies between customers, clients, and your own organization; (6) stay out of the campaign financing game - influence peddling can only hurt a large number of people. This book should be on every leader's desk and the lessons learned should be truly embraced, inculcated throughout our organizations, and expanded to our larger world economic community. A five out of five rating for Ms. Toffler.

Excellent Book

As a former (non-Android) Andersen person who worked closely with many of the people mentioned in Toffler's book right up to the bitter end, I can attest to the accuracy of her inside view of Andersen. Sadly, her experiences there mirrored many of my own and I agree with all of her conclusions about what really caused the downfall of the firm - i.e., it was management (or lack thereof), not the government, that killed the firm. I highly recommend this book for anyone interested in Andersen specifically or in corporate culture and ethics in general.

A Book I Couldn't Put Down

I have a confession to make. I'm one of those corporate assasins, a certified public accountant, albeit one who never worked for Arthur Andersen. And, I am ashamed of my profession. If even part of the material in this book is true, and I have every reason to suspect that most of it is true, Arthur Andersen deserved to be shut down. I suspect some of the other 'Final Four' firms deserve similar treatment too. When I got this book, I opened it expecting to read just a chapter or two. I could not put it down. Barbara Ley Toffler's observations about the way things really work at the large public accounting firms are exactly the same impressions I got as a "Big 8" senior manager over 20 years ago. I found one particular story very telling. She describes an educational meeting where she asks the managers in attendance where they felt their principal responsibilities lay while performing an audit. Was it to the public, government, the firm, fellow team members, or to the partner on the engagement? The managers overwhelmingly responded that their principal responsibilities lay with pleasing the partner. That was what was so sick about working for a national firm. The game being played had nothing to do with serving the public, or particularly the client either. It was all about serving that boss down the hall, the partner. Make him happy and your career was smooth. Make him angry and you soon would be looking for another job. Practicing a profession isn't just all about making money. Apparently, as I suspected, too many partners at Arthur Andersen and probably many others at other national firms don't understand this any more. One particular reviewer gave this book a single star. I suspect that reviewer is actually a former Arthur Andersen android who delusionally thinks that their firm got the shaft unjustly. This book would have been a lot stronger if the author had not annointed herself as a hero. After all, she did spend four years running on the hamster wheel like all the others. I suspect that she was actually fired for "failure to make her numbers." If she had told us more about her own failings, I would have respected her more. I suspect the real heros were those who were hired in from outside who left soon thereafter when they realized that they had really signed on to a soul destroying commercial enterprise.

Well written explanation of the fall...a unique perspective

Ms. Toffler and Ms. Reingold capture the essence of a once-great Firm struggling through the tumult of a changing business environment, poor management, and individual greed.Ms. Toffler was head of a specialized group of consultants within Arthur Andersen offering advice to clients on Ethics and related business issues. She laments the situation she and the Firm were in, offering advice to clients, while having no in-house ethics program ... "The Cobblers Child" as noted in a later chapter.As an ex-Android, I read this book with a mixture of fascination, fond memories, and sadness. Ms. Toffler provides an excellent explanation of the "fees generated" and "fees supervised" measures which drove partners and managers toward goals at odds with the best interests of the client. The results were, unfortunately, predictable.With her previous experience at the Harvard Business School and with her own consulting business, Ms. Toffler provides wonderful insight into the issues which ultimately led to the "suicide" of Arthur Andersen.This is a book of definite interest to any ex-AA or ex-AC employees and to anyone with an interest in the ethical basis for this sad chapter of American business.