Attestation Update – A&A for CPAs

Technical stuff for CPAs providing attestation services

Andersen arises from the grave, again

with 2 comments

Photo doesn’t do justice as a reminder of the fabled AA double doors, but it is a reasonable approximation. Image courtesy of Adobe Stock.

A second firm that proudly claims the Arthur Andersen name is now officially in operation.

3/1 – Stephane Laffont-Reveilhac, AA Global Managing Partner at LinkedIn post – Arthur Andersen restarts with 26 offices in 16 countries on 5 continents – Announcement declares that Arthur Andersen is back. March 1, 2017 marks the official start of the new firm.

I don’t quite understand exactly where the new AA is at in terms of operations. The article uses several verbs that are a bit confusing, such as they “…are setting up…” the firm, and there are five (only 5) offices in the US. Comments from Andersen Tax reinforce my confusion. That all makes sense when I consider the new firm is in start-up mode.

The short article says the firm asserts it is

…the rightful holder of the ‘ARTHUR ANDERSEN” and “ANDERSEN” historical trademarks, logos … at a global level…

There is also a firm called Andersen Tax, which was previously known as WTAS. This firm was founded by 23 former partners of Andersen. They avoid audit work, focusing instead on tax, with legal work also available in two of the European markets.

There is a fight underway between the two firms over the Andersen name. Both claim to have exclusive rights to the name.

If you want a quick survey of the conflict, check out Going Concern on 3/3: Accounting News Roundup: Will the Real Arthur Andersen Please Stand Up?

If you’ve actually read this far in this post, you will certainly want to check out two in-depth articles:

3/2 – Michael Cohn at Accounting Today – Firms vie over rights to Arthur Andersen name – Article repeats the assertions from the initial announcement that Arthur Andersen (AA) holds trademark to the name.

Andersen Tax (AT) disagrees, asserting they bought the rights to the name from the bankruptcy trustee and therefore have exclusive rights in the US and worldwide.

(To economize on the high cost of buying another terabyte of pixels, I’ll start using the abbreviations of AT and AA, with old AA and new AA when needed to differentiate the two.)

AT says they filed suit against the AA firm in the French courts demanding AA stop using the name.

AT claims the moral high ground as well, saying there are 23 former partners of the old AA working at AT, while AT is only aware of one former legal counsel from the old AA who currently works at the new AA.

(For many of my readers, please suspend disbelief that anyone is claiming the moral high ground when the name Andersen is involved – – just pretend you are watching a sci-fi movie and enjoy your popcorn. For readers who do not understand my comment, please see my discussions in previous posts, linked below.)

AT’s in-house counsel tells Accounting Today that it looks to him like the AA offices consist of shared offices and a mail drop, with some listed phone numbers not working.

Accounting Today called the AA office in New York. Conversation with the managing partner there gives the picture of a new firm that is currently in the process of hiring staff and gearing up.

3/6 – Michael Cohn at Accounting Today – Dispute over Arthur Andersen name heats up – Both firms reassert they hold the rights to the name.

In new info, AA says there have been a number of former partners of the old AA that have joined the new AA. That fits with my perception that the firm is brand spanking new and is in the process of recruiting partners, bringing on staff, finding and outfitting office space, and in general getting started.

AA has a press conference scheduled for March 15 in New York. Look for more news in a week.

The managing partner of AT says he has a set of double doors in his garage. If you worked at the old AA, you know what that means. Set those doors up in the headquarters of the firm and there will be an instant appeal to those who still believe the Andersen name is respected and valuable.

Article says that both AA and AT have reached out to the other firm offering to buy out the other’s rights to the name. On the surface that sounds like each firm is acknowledging the other has a legitimate claim. Think about it a moment and you realize both firms tried to get the other to surrender any claims they think they have. A big check in private would be easier and cheaper than a court fight and PR battle that will take years to resolve.

An article from 2015 provides some background:

9/9/15 – Financial Times – Arthur Andersen rises from the Enron ashes – twice – Article describes the announcement of the new Arthur Andersen and background on the already functioning Andersen Tax.

Previous posts on the return of Andersen:

Written by Jim Ulvog

March 7, 2017, 9:16 am at 9:16 am

Posted in Other stuff

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2 Responses

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  1. The name may be so tainted that it isn’t worth the fight.

    Bill Cleary

    March 7, 2017, 10:55 am at 10:55 am

    • Hi Bill:

      That would be my thought. For the overwhelmingly vast majority of finance type people who were working at the turn of the century, the name is mud. On the other hand, Professor Michael Schaub said his current students were 9 when Andersen imploded.

      On the other, other hand, a huge portion of the 85,000 involuntary alumni of AA likely consider the name to be sterling, especially in the office they worked. A large portion of the large portion are now in decision-making roles in medium and large companies. Adding to your client list 5% or 10% or 15% of companies where that large portion of a large portion of people now work would create more billable hours than the new firm could ever hope to complete.

      Thanks for reading and taking the time to comment.

      Jim

      Jim Ulvog

      March 7, 2017, 11:20 am at 11:20 am


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