Editing Arthur Andersen (section)

=== Andersen Consulting and Accenture ===
The consulting wing of the firm became increasingly important during the 1970s and 1980s, growing at a much faster rate than the more established accounting, auditing, and tax practice. In a further effort to take advantage of [[economies of scale]], [[Price Waterhouse]] and Arthur Andersen discussed a merger in 1989<ref>{{cite web|url=http://faculty.washington.edu/krumme/companies/account.html |title=University of Washington: Accounting firms and organisations |publisher=Faculty.washington.edu}}</ref> but the negotiations failed, mainly because of conflicts of interest such as Andersen's strong commercial links with [[IBM]] and PW's audit of IBM, as well as the two firms' radically different cultures. It was said by those involved with the failed merger that at the end of the discussion, the partners at the table realized they had different views of business, and the potential merger was scrapped.<ref>{{cite news|url=https://www.latimes.com/archives/la-xpm-1989-09-26-fi-365-story.html|title=Accounting Giants Call Off Merger Plan : Price Waterhouse, Arthur Andersen Cite 'Differences'|newspaper=Los Angeles Times|date=26 September 1989|access-date=17 August 2013}}</ref>

In 1989, Arthur Andersen and [[Andersen Consulting]] became separate units of [[Andersen Worldwide Société Coopérative]]. The two businesses spent most of the 1990s in a bitter dispute. Andersen Consulting saw a huge surge in profits during the decade. The consultants, however, continued to resent transfer payments they were required to make to Arthur Andersen. In August 2000, at the conclusion of [[International Chamber of Commerce]] arbitration of the dispute, the arbitrators granted Andersen Consulting its independence from Arthur Andersen, but awarded $1.2 billion in past payments (held in [[escrow]] pending the ruling) to Arthur Andersen, and declared that Andersen Consulting could no longer use the Andersen name.<ref>{{cite web|url=https://www.trans-lex.org/209797/_/icc-award-no-9797-asa-bull-2000-at-514-et-seq/|title=Final Award in ICC Case No. 9797/CK/AER/ACS, Andersen Consulting Business Unit Member Firms v. Arthur Andersen Business Unit Member Firms and Andersen Worldwide Société Coopérative, made in Geneva on 28 July 2000|publisher=Trans-Lex|access-date=30 January 2024}}</ref><ref>{{cite news|url=https://money.cnn.com/2000/08/07/news/andersen/|title=Andersen Consulting arm wins divorce it sought from Arthur Andersen|date=7 August 2000|newspaper=CNN|access-date=30 January 2024}}</ref> As a result, Andersen Consulting changed its name to [[Accenture]] on January 1, 2001, and Arthur Andersen, having the right to the Andersen Consulting name, rebranded itself to "Andersen".<ref>{{cite news|url=https://www.independent.ie/business/no-more-arthur-for-big-andersen-firm-in-revamp/26092350.html|title=No more 'Arthur' for big Andersen firm in revamp|date=6 March 2001|newspaper=The Irish Independent| access-date=30 January 2024}}</ref>

Four hours after the arbitrator made his ruling, Arthur Andersen CEO [[Jim Wadia]] resigned. Industry analysts and business school professors alike viewed the event as a complete victory for Andersen Consulting.<ref>{{cite web | author=Mitchell Martin |title=Arbitrator's Ruling Goes Against Accounting Arm: Consultants Win Battle Of Andersen |url=http://www.iht.com/articles/2000/08/08/consult.2.t.php |work=International Herald Tribune |date=August 8, 2000 |access-date=May 5, 2008 |archive-url=https://web.archive.org/web/20080308142059/http://www.iht.com/articles/2000/08/08/consult.2.t.php |archive-date=March 8, 2008 |url-status=live  }}</ref> Wadia would provide insight on his resignation years later at a Harvard Business school case activity about the split. It turned out that the Arthur Andersen board passed a resolution saying he had to resign if he did not get at least an incremental $4 billion (either through negotiation or via the arbitrator decision) for the consulting practice to split off, hence his quick resignation once the decision was announced.<ref>{{cite news| url = https://www.telegraph.co.uk/finance/4461169/Andersen-chief-quits-as-14bn-claim-fails.html |title= Andersen chief quits as $14bn claim fails|author= Philip Aldrick|newspaper=The Daily Telegraph |date = August 8, 2000}}</ref>

Accounts vary on why the split occurred—executives on both sides of the split cite greed and arrogance on the part of the other side. The executives on the Andersen Consulting side maintained it was a [[breach of contract]] when Arthur Andersen created a second consulting group, AABC (Arthur Andersen Business Consulting) which competed directly with Andersen Consulting in the marketplace.<ref>{{cite news|url=https://www.independent.co.uk/news/business/news/arthur-andersen-head-resigns-712089.html|title=Arthur Andersen head resigns|date=8 August 2000|newspaper=The Independent|access-date=30 January 2024}}</ref>