This was the result of employing a specific business model, and a chain of recurring events that followed the execution of that business model.
Three ways Accenture Case analysis arthur andersen questionable accounting cheating on its clients, just like Tiger Woods Accenture recently announced that it cancels its sponsorship of Tiger Woods after the tragic infidelity scandal. Ironically, it is more fitting than ever for Accenture to be associated with Tiger Woods with these new facts on the table… It turns out Tiger Woods has systematically cheated on his wife, ever since before the wedding, and even on his own bachelor party.
It has been a repeated behavior because there have been 14 women identified as his mistresses, so far, many of whom claim they had sex with Tiger on numerous occasions. This is representative of Accenture which also cheats.
For a consulting firm, like Accenture, infidelity can have multiple meanings. And cheating, or going behind the back of your client, can be done in several ways: Overcharging Anyone who has worked in Accenture has seen the overcharging that is taking place on almost all client projects.
This normally happens in any of a number of ways. Of course, Accenture who does these analyses often, does know very well when these analyses are not needed, which makes it morally doubtful. With the work pressure put on managers within Accenture some of them add a few hours to the invoice that were never delivered.
The firm is infamous for its negative work pressure which burns out many of its employees. Another creative way Accenture has of overcharging is to have consultants present in the client office but working on something else, for example having them work on a proposal for the next client, who might be a competitor.
Then the current client is billed for the time worked on the proposal. This tactic has its advantage that the client can actually see the consultant working hard, typing away on his keyboard.
Junior consultants, straight out of universityare encouraged to think creatively to find ways to overcharge the clients. Accenture Senior Executives, continuously pressure employees lower down in the hierarchy to try to either stay on longer on their projects than initially planned or find more work to do for the client than was not initially agreed upon.
Harmful recommendations Another way for Accenture to cheat its clients is to give them bad recommendations. First, some IT system vendors give higher kick-back fees to Accenture than others. SAP is known for giving higher commission to consulting firms who sell one of their systems than Microsoft or PeopleSoft do, for example.
The second incentive is the number of consulting man-days needed to implement the system. Of course, Accenture charges thousands of dollars per day when implementing a system. The actual difference between SAP and another system can be in the range of USD 5 million for a mid-sized company with two or three divisions.
That is profit to Accenture and loss to the client. And a pretty good reason for Accenture to recommend one system over another. Quite different from the detailed data collection made for other, less relevant information, which is purely done to charge many consulting man-days as already mentioned.
So, recipe for billing is to spend lots of days analyzing employee attitudes towards IT systems, not so much efforts on keeping costs down for the client of their next implementation project.Arthur Andersen: Questionable Accounting Practices Arthur Andersen LLP was founded in Chicago in by Arthur Andersen and partner Clarence DeLany.
After 90 years of hard work, this accounting firm we become known as one of the Big Five largest accounting firms in the United States. A decade ago, the administrative costs of health care in the United States greatly exceeded those in Canada. We investigated whether the ascendancy of computerization, managed care, and the.
leslutinsduphoenix.com: News analysis, commentary, and research for business technology professionals. May 04, · The Money Issue.
Why Only One Top Banker Went to Jail for the Financial Crisis. The demise of the public accounting firm Arthur Andersen and one of its clientele, Enron contributed to drastic changes for publicly held companies, accountants, questionable and millions in fees generated, perhaps Andersen looked the other way.
as supervise Derek Claybrook in the analysis of these transactions.
In November , the. The 10 Worst Corporate Accounting Scandals of All Time.
Main players: Founder/CEO/Chairman Dean L. Buntrock and other top executives; Arthur Andersen Company (auditors) SEC and Manhattan D.A. investigations uncovered questionable accounting practices, including large loans made to Kozlowski that were then forgiven.