As a quasi-practicing Catholic, I thought it providential that at a press conference on Good Friday, former Federal Reserve chairman Paul Volcker, the man saddled with the unenviable job of navigating Andersen out of its current legal and industry maelstrom, began throwing out words like "reformation", "mass," and "resurrection."
There&'s a poignant symbolism there, and to be sure, Volcker didn't miss the opportunity to connect the dots.
After showing chief executive Joe Berardino the door last week, Volcker, issued a sort of "I'll quit if you don't support my plan to turn Andersen into a pure auditing firm" type of threat to the firm's U.S. partners.
And guess what?
The majority of Andersen audit partners have rallied behind Volcker's plan to reformat Andersen into an audit-only firm or as he referred to it as reaching a "critical mass" of partners.
The result would be a "scaled down" Andersen, with obvious human capital attrition from the non-audit services partners and a laundry list of details yet to be worked out.
Volcker, who appointed senior audit partners C.E. Andrews and Larry Rieger to head the "reformation" to the "new Andersen" deftly sidestepped reporters' questions regarding his feeling of whether the Justice Department would drop the criminal indictment of the firm ' a non-negotiable condition in order for his plan to move forward.
Volcker, danced around the issue with surprising grace for a man of 75 and flaunted a Cheshire cat grin that inferred he knew much more about the status of the indictment than anybody in attendance. "I will take a personal interest in the firm's negotiations with Justice."
In his 50-year career in banking and later in public service as chairman of the Federal Reserve, Volcker no doubt has more markers on Capitol Hill waiting to be called in than Sky Masterson. If Volcker was not guardedly optimistic that the DOJ would tear up the complaint or at least partially amend it to a degree to focus on the Enron audit team, I doubt he'd be holding what seems heretofore like regular Friday press conferences.
"I'm not running this firm," Volcker reminded members of the Fourth Estate. "I'm in a strong advisory role."
That however, I do not believe.
I don't imagine that Mssrs Andrews and Rieger would make an overseas phone call without approval from Volcker and his Oversight Board.
Volcker, Andrews and Rieger also pooh-poohed rebranding Andersen, collectively indicating they "hadn't given it much thought."
I don't believe that either, given the fact that if their plan to go forward as an audit-only firm comes to fruition, the resulting entity must carry a name now inextricably linked with a spate of audit implosions.
I don't doubt for a minute that Paul Volcker is confident he can pull this off. I think fairly adept at reading people, as I've spent the last 20 years trying to do just that.
Now it's just a matter of Volcker convincing the right people that he can.-Bill Carlino
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