CHICAGO: Andersen will soon announce a series of reforms in the way
it does business, in an effort to rebuild confidence among investors and
The news comes as scrutiny of accounting practices increases, and
Andersen's own clients reconsider their relationships with the Big Five
"We expect there will be a change in law and regulations," said Charlie
Leonard, partner with Chlopak, Leonard, Schechter & Associates, one of
Andersen's PR teams. "Andersen will announce changes of its own that
will distinguish the firm in the marketplace."
Scrutiny of Andersen has extended to several of its clients, some of
whom are facing tough economic situations. Leonard said that Andersen
has mounted an intense effort to reassure clients, addressing issues in
Global Crossing, an Andersen client and telecoms company, filed for
bankruptcy last week, prompting a Wall Street Journal headline,
"Analysts Fault the Accounting at Global Crossing." The company's agency
of record since its IPO is Sitrick & Company.
Qwest Communications, announced its year-end results last week, and also
found itself answering questions about its retention of Andersen.
"They've done a good job," said chairman and CEO Joseph Nacchio in
answer to a reporter's question. "But there certainly is a pall about
Andersen. I think it is prudent for us to have that discussion with our
board and audit committee."