Slightly off topic: this discussion of Ernst and Young made me curious about Arthur Andersen and their fraud.
It's interesting reading. To wutang's point, it seems that an aggressive cross-selling culture incentivized one or two accounting partners at AA to sign off on some sketchy stuff. The entire firm didn't fully assess the risk. (I don't know how accounting firms work today, seems likely they have centralized risk management and their managers place more emphasis on risk than on maximizing profits via selling.)
But to ghm's point, AA made about $50M a year from Enron. (Which brought down a company with $9B in revenue)
It's interesting reading. To wutang's point, it seems that an aggressive cross-selling culture incentivized one or two accounting partners at AA to sign off on some sketchy stuff. The entire firm didn't fully assess the risk. (I don't know how accounting firms work today, seems likely they have centralized risk management and their managers place more emphasis on risk than on maximizing profits via selling.)
But to ghm's point, AA made about $50M a year from Enron. (Which brought down a company with $9B in revenue)