As the firm’s leader here in the UK, I give you my personal assurance that our people remain completely focused on the important work we do every day for you, particularly at this busy time of year in the financial calendar.
We’ve been in business here in Britain for half a century. Our 500 partners and 5,500 other staff here are proud of their work and determined to defend our long-established reputation for professional competence and integrity. The heat is on Andersen precisely because of the openness and integrity with which we have responded to the interest in our role.
But I want to take this opportunity to put straight some of the myths that are circulating. Enron was an innovative and complex business that failed and responsibility for its strategy, financing and ultimate failure rests primarily with the company’s management and directors. Much information was publicly available about Enron and its complexities and others had access to private information about the company. Andersen should not be singled out as being responsible for Enron’s failure, which it appears was not anticipated by many.
Inevitably, because these events and the continuing investigations into them are centred in the United States, Andersen’s response has been provided by our US firm. It has not been possible for us to answer all the questions that people here have been asking because we simply don’t have all of the facts yet. No one does.
I am, however, satisfied by the assurances I have received from my colleagues that they will continue to be open, honest and conscientious in assisting the search for answers. We will take appropriate responsibility for any role we played in these events.
Our global CEO testified before Congress at the first available opportunity, and before knowing all the facts, while Enron executives refused to do so. We handed over our Enron files immediately and before we had the opportunity to review their content. All auditors routinely destroy during and after any audit many non-material documents, but as soon as we found that an Andersen partner had committed a serious error of judgment in relation to the destruction of documents, we notified the authorities and dealt with the people involved firmly and publicly. We are recovering many of the electronic documents and providing them to the authorities. We’re taking every possible step to establish the facts, remedy the mistakes and act upon all the lessons learned.
Much of the comment in the press focused on US accounting standards. In the UK, of course, there are different accounting standards. Our current practices and policies are robust and should not cause you, or your shareholders, any concern. Nevertheless, we have reiterated to all personnel our uncompromising commitment to professional integrity and reminded them of the clear policies we have, for instance on retaining audit documents that support our opinion.
Enron and other business failures rightly pose questions for the profession and others. Whatever emerges from the ashes of Enron, if the profession needs to change the way it works here in the UK, we will support that.
Over the course of the next few days we will be providing more factual information. We will also inform you immediately if any new information has significance for your company. We are keeping our partners and staff updated so that they can help with your questions. If there is any matter that you would like to raise with me personally, please don’t hesitate to call or e-mail me.
Despite these events you can rest assured we are committed to maintaining our high quality of service to you and thank you for your support.
John OrmerodAndersen UK Country Managing Partner