Andersen Suspended From New Government Contract Work | AccountingWEB

Andersen Suspended From New Government Contract Work

Following the Justice Department's indictment against Arthur Andersen last Thursday, the United States General Services Administration suspended Andersen from pursuing any new federal government work during the period that the indictment is in place.

According to the GSA, indictments for criminal offenses, such as the one handed down to the Andersen accounting firm on Thursday, offers "adequate evidence of misconduct to support suspension of a government contractor."

The GSA issued a similar suspension for Enron and related Enron employees for a period of twelve months.

The GSA offers this explanation of the suspension:

"The indictment of the Andersen firm for obstructing ongoing official proceedings relating to their audit work clearly supports a suspension from federal contracting. The government employs private accounting firms to perform important financial control work in accordance with the highest professional standards. Unlawful destruction of documents to obstruct federal investigations is contrary to these standards, and establishes Andersen's nonresponsibility for future federal contracts. GSA has also suspended David Duncan, former engagement partner for Arthur Andersen at Enron, based on his involvement, knowledge of, or complicity in the admitted destruction or deletion of Enron-related documents and records at Andersen, in the face of imminent Government investigations and potential litigation."

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