Ruling Imminent on Andersen Split
In an interview with Dow Jones Newswires, Guillermo Gamba, the Columbian lawyer who was appointed by the ICC to arbitrate between the Big Five accountant and its consulting offshoot, said he had submitted his ruling to the ICC.
Gamba would not divulge what he had decided and the firms themselves have yet to hear. A spokesman for Andersen Consulting said the ICC would review the ruling first before any party is told, but added, "Andersen Consulting remains fully confident in the merit of its case and looks forward to the ruling."
The Securities and Exchange Commission's increasingly tough requirements for auditor independence make the spilt a foregone conclusion. The main question that remains unresolved is how much compensation Andersen Consulting will be required to pay. Arthur Andersen was seeking to retain sole use of the Andersen name, plus $10 billion under the arrangements put in place when Consulting was founded.
Consulting was seeking $400 million compensation for abuses by its accounting parent, which allegedly included poaching staff and fees from the joint pool. The claim is roughly equivalent to the fees subitted from Consulting to Arthur's since 1989.
Consulting shocked the accountancy world when it announced in 1997 that it wanted out from under Arthur's wing. But thanks to the SEC, Ernst & Young has sold the bulk of its consultancy to Cap Gemini, KPMG has unveiled plans to float its consultancy and PricewaterhouseCoopers has announced its intention to split its service lines into different firms.