Andersen Split has Rippling Effect

Now that Andersen Consulting has made a formal split from its parent company, Arthur Andersen, some analysts are saying that the larger, Big 5 firm will suffer from separation anxiety.

What's the affect of such a split? Financially, Arthur Andersen has lost a division worth $10 billion, along with more than $200 million in profit-sharing fees each year.

But more than that, the word on the street is that the split forces Arthur Andersen to become more competitive, having been relegated to the least profitable Big 5 in terms of revenues.

One proposed path for the Big 5 firm is to increase its revenues with its finance consulting division for internal accounting matters. Most likely, nothing major will be done until a new CEO can be secured for the firm.


Already a member? log in here.

Editor's Choice

Upcoming CPE Webinars

Dec 3The materials discuss the concepts and principles in the AICPA’s new special purpose framework.
Dec 8Kristen Rampe will cover how to diffuse the tension in challenging situations in this one-hour webinar.
Dec 9A key component to improving your firm’s workflow efficiency while enhancing your profitability at the same time is how you leverage emerging technologies.
Dec 16Kristen Rampe will give tips on how to bring confidence into the room and build a valuable network.