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FedEx dumps Andersen
Company hires Ernst & Young as independent auditor.
March 11, 2002: 2:59 PM EST

NEW YORK (CNN/Money) - FedEx Corp. dropped Arthur Andersen as its independent auditor Monday and hired rival Ernst & Young LLP, becoming the latest company to dump the accounting firm in the wake of Enron Corp.'s collapse.

Memphis-based FedEx's (FDX: Research, Estimates) board of directors made the change after an extensive evaluation process. The switch to Ernst & Young will occur after Andersen completes its review of the company's financial statements for the fiscal quarter ended Feb. 28, FedEx said.

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The decision was not the result of any disagreement with Andersen. "During its long tenure as the company's outside auditors, Arthur Andersen has provided many years of quality service and has demonstrated a high level of professionalism," FedEx said.

Separately, Riggs National Corp. also dropped Andersen after 28 years and switched to KPMG as its independent auditor. Washington-based Riggs (RIGS: Research, Estimates), a bank holding company, said KPMG's hiring was subject to ratification by Riggs shareholders at its annual meeting on April 17.

Andersen's connection to bankrupt energy trader Enron has led some of its top clients to reconsider their relationships with the auditor. The Chicago-based accounting firm is currently trying to settle litigation resulting from its role in Enron's collapse and is in talks with Deloitte Touche Tohmatsu, international parent firm of U.S.-based Deloitte & Touche, to sell or merge all or some of its business.

Earlier this month, Andersen lost its largest client, Merck & Co. (MRK: Research, Estimates), which dropped Andersen as its outside auditor after 30 years and hired PricewaterhouseCoopers.

Delta Airlines (DEL: Research, Estimates) also switched to Deloitte & Touche and dropped Andersen. The nation's No. 3 airline had used Andersen as its accountant since 1949. Mortgage provider Freddie Mac also changed auditors, hiring PricewaterhouseCoopers and dropping Andersen.  graphic


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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.