" Inside Arthur Andersen provides a perceptive analysis of the changes in cultural values that took Andersen from the top of the accounting profession to its doom.The authors do a superb job of analyzing the historical Andersen culture and the varied forces that led to dramatic changes in that culture in recent years. In addition, the authors display great insight into what made Andersen great and the changes that led it to fail, while also raising serious questions about the remaining accounting firms and whether they understand how they must change to survive. In the struggle between public interest and private profit, private profit won out only to cause Andersen to fail."-Arthur R. Wyatt, Retired Partner, Arthur Andersen, former member, FASB, and past Chairman, IASC"This book provides a thought-provoking account of how the firm's culture changed over time. It is balanced and helped me make sense of what happened to our once-great firm."-James Brennan, former Associate Partner, Andersen Consulting"This author team is the best to provide insider insights and credible explanations of what happened at Arthur Andersen and why it happened. The story they tell contains valuable lessons for all companies and leaders and is a must-read for anyone interested in the health and well-being of companies today."-D.Quinn Mills, Harvard Business School, and author of Wheel, Deal, and Steal ."The wave of corporate financial scandals has served to emphasize the critical role of the external auditor in maintaining a market economy. Arthur Andersen had a distinguished history of being the 'gold standard' of the profession. How this highly respected firm lost its bearings is the subject of a superb, serious study by former Andersen employees. Inside Arthur Andersen is and will remain the definitive explanation of the downward spiral to Enron."-Leonard R. Sayles, Professor Emeritus, Graduate School of Business, Columbia University" Inside Arthur Andersen provides a lively excursion through the conflicting goals and values that permeate organizations in general and the public accounting profession in particular. The story of the birth and death of the Arthur Andersen firm is loaded with lessons for us all. This book should appeal especially to readers who want an overview of the dramatic consequences of Andersen's changing values through the years."-Charles T. Horngren, Stanford Graduate School of Business" Inside Arthur Andersen provides an outstanding chronology of the birth and life of a great firm. Andersen had an extraordinary culture and exceptional strategies that resulted in unquestioned leadership professionally and in the financial and business world. Somehow management lost sight of its 'core' and greed destroyed what I valued as a partner for 22 years."-Dean Christensen, former Arthur Andersen local office managing partnerThe collapse of Arthur Andersen was among the most profound events in the history of American business. For nearly a century, Andersen was synonymous with integrity. Seemingly overnight, the firm imploded in scandal. How could it have happened? Inside Arthur Andersen uncovers the roots of Andersen's collapse, tracing its spectacular two-decade transformation from staid auditor to aggressive consulting firm-and the profound change in corporate culture that made it possible for Andersen people to begin shredding thousands of Enron documents that fateful day in October 2001.Could Andersen have adapted to a new business environment without compromising the values that first made it successful? How did Andersen's leaders miss the harbingers of disaster? The authors of this book are uniquely well positioned to answer these questions. Together they bring more than 26+ years' experience studying Andersen culture from the inside. In this book, they tell a story that every leader needs to hear. Enron and

Cynthia J. Smith worked in the Management Development Group in Arthur Andersen's Center for Professional Education and Development. She also worked at World Headquarters on cultural risk management and onsite with engagement teams in Asia developing improvements in high risk and international project management Lorna McDougall has extensive experience in organizational development for major companies and universities in the U.S. and UK. She joined Andersen Worldwide's Performance Consulting group in 1990, where her work included research, organizational planning and development, and cross-cultural training for worldwide delivery for Audit, Tax, and Consulting William R. Yeack joined Arthur Andersen in 1981, worked on audit engagements, earned his CPA (1983), and was a member of the Management Information Consulting Division, which became Andersen Consulting. He specialized in large, high-risk projects in the utility and financial industries. He held high-level executive positions with international responsibilities that involved ongoing business relations with the firm

Preface The fall of Arthur Andersenone of the five largest accounting firms in the worldwas as much a shock to its 85,000 worldwide employees as it was to the business community and the general public. Except for the Enron engagement team, those inside the global firm knew little about its association with Enron. Most first learned from the media of the Andersen felony indictment for obstructing a federal investigation. Even then, it was inconceivable to most Andersen employees that the entire firm, with offices all over the world, could be affected so profoundly. Within days, desks were being packed, families relocated, whole offices parcelled off. Everyone was left looking back at what had been. The story is poignant, not just because it affected the lives of those inside but because it has a message for businesses today in all sectors. The changes inside and outside the firm that led to actions so out of character for the company's founder, Arthur E. Andersen, are changes that can and will affect other companies, perhaps yours. The mission of this book is to tell what happened, as seen from insidebefore, during, and afterto those who are not insiders of Arthur Andersen or the accounting industry, and provide insights for those who were insiders. The authors, Susan E. Squires, Cynthia J. Smith, Lorna McDougall, and William R. Yeack were all employed by Andersen and bring over 26 years of collective experience with the firm to the Andersen story. The book's tale is of a firm that changed as competition among the big accounting firms became aggressive. To survive and prosper, Andersen changed and adapted in ways many firms today are changing and adapting. From the days of Arthur E. Andersen's original public accounting firm that provided honest audit service, the firm became a dynamic, sprawling, more aggressive multiservice organization with clients willing to skate ever closer to the edge of risk. This book chronicles key decisions that led to changes in Andersen's culture and the external and internal factors that led to events that would have been unlikelyeven impossibleonly a few years before. The story begins as Arthur Andersen goes to trial, then recounts the sequence of events that brought the firm to courtthe day things turned uglythe media coverage of the shredding, and the fall of the first of several dominos that would eventually topple Arthur Andersen. You will get the inside view from several perspectives of the firm. What was it like to work at Arthur Andersen? How did the company grow from a small accounting firm dominated by one individual to a global firm that was the largest of its kind in the world when it became Enron's auditor? You will understand the long chain of events that eventually caused Andersen to fall. These events shed light on the role of accounting in the American economic system and on current concerns. In the end, you can consider what this means for you and perhaps for your company. About the Authors Arthur Andersen is a unique case to which analysis of the organizational culture can be applied. All authors are Andersen "insiders" who were participants and observers within the Andersen organization and are able to share a factual business picture, as well as a very human face of the firm's story. Three of the authors of this book are cultural experts who held positions at the firm. Based on their understanding and first-hand experience, the authors are able to shed light on events and core values of the legendary Andersen culture and how they were transformed over time, especially from 1981 to 1997, the time span of their experience. Dr. Susan E. Squires was at Andersen Worldwide's Center of Professional Development from 1993 to 1997, working with both Arthur Andersen and Andersen Consulting as an evaluator and cultural consultant on intern