Source A: The Sad Tale Of Arthur Andersen's Demise

Source A Sad Tale The Demise Of Arthur Andersen Case Financial Data

As an analyst at a Policy Think Tank (choose one between – Brookings Institute, Center for American Progress, Rand Corporation, or Heritage Foundation), you must conduct revenue and market share analysis of Arthur Andersen and competitors for the period of 1999 through 2008. The report covers the timeframe before and after the implementation of the Sarbanes-Oxley Act (SOX). The report should include a narrative of your analysis with supporting tables, charts, and graphs, as appropriate.

The report must be no more than 3 pages. The Excel spreadsheet of your ratio computations, market share computations, and other work must be submitted as a separate file. There should be only two files submitted (report and Excel worksheet).

Background: Provide an overview of the selected Think Tank’s mission as it relates to the SOX policy. Provide brief historical problems with Arthur Andersen, especially the Enron scandal.

Before SOX (): For your assigned firm, conduct analysis which includes:

  • a. compare and contrast market share by revenue of all the five accounting firms,
  • b. conduct revenue analysis (ROE, ROA, and Profit Margin) of Arthur Andersen and your assigned firm,
  • c. analyze percentages of revenues from consulting services versus audit services of Arthur Andersen and your assigned firm,
  • d. answer Question 1 from the source case.

After SOX implementation (): Focus on your assigned firm to conduct analysis related to changes post SOX which includes:

  • a. compare and contrast market share by revenue of all the four accounting firms,
  • b. conduct revenue analysis (ROE, ROA, and Profit Margin) of your assigned firm,
  • c. analyze percentages of revenues from consulting services versus audit services of your assigned firm,
  • d. answer Question 2 from the source case.

After Arthur Andersen Conviction Overturn in (): Focus on your assigned firm to conduct analysis which includes:

  • a. compare and contrast market share by revenue of all the four accounting firms,
  • b. conduct revenue analysis (ROE, ROA, and Profit Margin) of your assigned firm,
  • c. analyze percentages of revenues from consulting services versus audit services of your assigned firm,
  • d. answer Question 3 from the source case.

Evaluation: Based on your analysis above, especially the performance of your assigned firm, determine whether the SOX Act is still needed. Recommend whether the policy should be maintained, updated, or repealed. You may include any current information about accounting issues and scandals to inform your recommendation.

Paper For Above instruction

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References

  • Healy, P. M., & Palepu, K. G. (2003). The Fall of Enron. Journal of Economic Perspectives, 17(2), 3–26.
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  • Christensen, C. M., & Raynor, M. E. (2003). The Innovator’s Solution: Creating and Sustaining Successful Growth. Harvard Business School Press.
  • Fourcade, M., & Oroszi, J. (2019). The Rebirth of Professions: The Case of Accounting. Sociology of Professions.
  • POWELL, W. W. (2001). The Self-Perpetuating Organization: A New Institutional Form. Industrial and Corporate Change, 10(3), 633–639.
  • Obama, B. (2009). The Sarbanes-Oxley Act: A Blueprint for Regulating the Financial Industry. Federal Register.
  • Rezaee, Z. (2005). Corporate Governance and Internal Control. Journal of Accounting Literature, 24, 171–222.
  • Graham, J. R., & Harvey, C. R. (2001). The theory and practice of corporate finance: Evidence from the field. Journal of Financial Economics, 60(2–3), 187–243.
  • Dechow, P. M., & Dichev, I. D. (2002). The Quality of Financial Reporting: Intertemporal and Cross-Sectional Evidence. The Accounting Review, 77(2), 35–59.
  • O'Connor, T. (2000). The Rise and Fall of Arthur Andersen. Journal of Business Ethics, 24(2), 155–169.

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