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To: Rarebird who wrote (71982)	6/19/2001 1:04:35 PM
From: long-gone	Read Replies (1) \| Respond to of 116753

<<I have always placed a tremendous value on Quantity of Experience. >> This statement, though, says nothing about quality.

To: Rarebird who wrote (71982)	6/20/2001 12:13:52 AM
From: long-gone	Respond to of 116753

OT I think even the pragmatist & the extremist can agree this is wrong, a big part of the bubble problem, but only the tip of the iceburg: Tuesday June 19, 7:34 pm Eastern Time Arthur Andersen to Pay $7M Fine Accounting Giant Arthur Andersen Agrees to Pay $7 Million Fine to Settle SEC Allegations By MARCY GORDON AP Business Writer WASHINGTON (AP) -- Accounting titan Arthur Andersen LLP has agreed to pay a $7 million civil fine to settle federal regulators' allegations it issued false and misleading audit reports that inflated a company's earnings by more than $1 billion. In a civil lawsuit filed Tuesday in federal court in Washington, the Securities and Exchange Commission alleged that Andersen ``knowingly or recklessly'' issued false and misleading audit reports for Waste Management Inc. [NYSE:WMI - news] for the years 1993 through 1996. Andersen neither admitted to nor denied the allegations in its settlement with the SEC regarding audits of Waste Management, which also was announced Tuesday. The SEC said the fine was the largest ever paid by a Big Five accounting firm in an enforcement action brought by the market watchdog agency. Under the settlement, Andersen also agreed to the SEC's first anti-fraud injunction against a Big Five firm in more than 20 years and agreed to be censured by the agency. In addition, three partners of Chicago-based Andersen who had been involved in the Waste Management audits agreed to pay a total $120,000 in civil fines. ``This settlement allows the firm and its partners to close a very difficult chapter and move on,'' Terry E. Hatchett, Andersen's managing partner for North America, said in a statement. ``We made a business decision to put the matter and the uncertainty of litigation behind us. Moreover, we did not want to suggest, through an ongoing dispute over long-past matters, that our firm has any disagreement with the SEC's desire for the highest-quality financial reporting and auditing. We share the SEC's desire to protect the public interest.'' In recent years the SEC has made pursuit of accounting irregularities a top priority and has been investigating the accounting practices of several large corporations. In May 2000, for example, the SEC fined America Online Inc. $3.5 million for allegedly violating financial reporting rules by counting advertising costs as assets. AOL, the world's biggest Internet services company, neither admitted nor denied the allegations. The company now known as Waste Management Inc. was formed in 1998 when Houston-based USA Waste Services Inc. bought Illinois-based Waste Management Inc., then adopted the company's name. The SEC began examining Waste Management's books in November 1997, when the giant trash hauler told the agency that a change in accounting systems would cause a $1.18 billion loss for 1997 and wipe out $1 billion in profits over the previous five years. Andersen, which had been Waste Management's auditor for decades, viewed the company as a ``crown jewel'' client and had too cozy a relationship with it, according to the SEC. For decades, every chief financial officer and chief accounting officer of Waste Management had previously worked as an Andersen auditor. During the 1990s, 14 former Andersen employees worked for Waste Management, most often in key financial and accounting positions, the SEC said. Waste Management paid Andersen at least $19 million in fees during the 1990s. In a statement, A. Maurice Myers, chairman, chief executive officer and president of Waste Management said the company was ``pleased'' the issue had been resolved. Myers said his company does not believe it will be sanctioned by the SEC and has resolved most of the shareholder litigation arising from the earnings restatement. The SEC has been pushing the nation's accounting firms to be more independent of the corporations they audit to avoid conflicts of interest and preserve the integrity of company financial reports -- thereby upholding investors' confidence in the stock markets. The agency adopted rules last November that provide investors with more information about potential conflicts of interest when accounting firms simultaneously audit companies and sell them lucrative consulting services. A year ago, Andersen and the other Big Five accounting firms, which dominate the industry -- PricewaterhouseCoopers, KPMG Peat Marwick, Deloitte & Touche and Ernst & Young -- agreed in an SEC action to report past violations of rules requiring accountants to remain independent from companies they audit. In return, the firms are sheltered from enforcement actions by regulators, except in cases involving the most serious violations. biz.yahoo.com