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News
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Delta may ground Andersen
graphic January 29, 2002: 7:02 a.m. ET

No. 3 airline mulls replacing embattled accounting firm, but time is short.
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  • Andersen CEO: Enron cost firm business -- Jan. 28, 2002
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  • Andersen
  • Delta Air Lines
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    NEW YORK (CNN/Money) - The fallout from Arthur Andersen's relationship with bankrupt energy trader Enron continues to haunt it as Delta Air Lines, the nation's third-largest carrier, considers replacing the accounting firm.

    The departure of Delta (DAL: down $0.26 to $32.06, Research, Estimates) would be a serious blow to Andersen, whose CEO, Joseph Berardino, said Monday that the firm had lost some business due to its association with Enron.

    If Andersen's Enron problems continue to mount and it is unable to perform its accounting duties, Delta's move to replace it would save it from having to scramble to find a new accountant.

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    But Delta isn't leaving itself much time to name a new auditor, as the airline told CNNfn that "the matter of Delta's independent auditor for 2002 is under review. As is our normal practice, the independent auditor will be named in the Proxy Statement in early March subject to stockholder ratification at the Annual Meeting on April 26."

    Delta's decision to look into other accounting firms comes after Berardino made a scheduled presentation before the company's board last Thursday, saying Andersen remains in a solid position to carry out its responsibilities for the carrier.

    The Atlanta-based airline paid Andersen $1.9 million for accounting services and $3.97 million for other services in 2000, according to the Wall Street Journal, citing Delta's proxy statement.

    Andersen has served as Delta's accountant since 1949 and the airline did invite the firm to compete for its new accounting contract, the paper reported. graphic

      RELATED STORIES

    Andersen CEO: Enron cost firm business -- Jan. 28, 2002

      RELATED LINKS

    Andersen

    Delta Air Lines





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