By the time he was 30, Larry Katzen made partner at Arthur Andersen, then one of the “Big 8” accounting firms with a reputation for innovation and integrity.
In the ensuing years, the firm continued to soar in stature. With an emphasis on continuing education for employees and meticulous attention to detail, it was one of the most trusted accounting firms in the industry.
Katzen enjoyed a fast-paced rise through the ranks, but it all came crashing down in 2002 when the company was indicted based on false accusations having to do with the scandals at Enron. With the firm’s survival in question, Katzen quickly moved to encourage employees to carefully complete all remaining assignments.
“Arthur Andersen became fodder for the government’s prosecution of Enron – although it had no role in Enron’s demise,” says Katzen, author of, “And You Thought Accountants Were Boring - My Life Inside Arthur Andersen.”
Arthur Andersen eventually was vindicated by a 9-0 Supreme Court ruling. By then, however, the damage had been done, creating chaos in the careers of thousands of employees. Arthur Andersen, which marked its 100th anniversary in September, still exists today, albeit in a different incarnation.
“I will never regret my time at the firm; it provided so much for me, including solid life lessons,” says Katzen, who shared some of those life lessons with us:
- Do the right thing. At the end of Katzen’s career, he had to help his employees find new jobs, which was an arduous process. “It was the right thing to do, which is its own reward, but the right actions also tend to have rewarding consequences,” he says. That lesson had taken root during Katzen’s college years at Drake University, when a trusted professor warned him against his plan to cancel a job interview with Arthur Andersen because he’d already received several promising offers. “If I hadn’t done what was right, if I hadn’t followed through on my commitment, my life would have gone down a very different path,” he says.
- Listen to your heart. Although Arthur Andersen gave him the lowest salary offer, Katzen nonetheless felt it was the right place for him. “My personality seemed to blend with their corporate culture,” he says. “So I turned down higher and more attractive offers and went with my heart.”
- Increases in responsibility come with personal sacrifice. Katzen had to uproot his life and family and move to a strange new town. But the short-term pain enabled the family to attain financial security and a better quality of life. “If you want to grow in an organization, success does not come without personal sacrifice,” he says. “In my case, it resulted in four moves – but it was well worth it.”
- Beware of the power of our government. In his first substantive experience in dealing with the IRS, Katzen quickly learned how coercive and powerful the agency can be. No matter how reasonable you may try to be with a government agency like the IRS, there is no guarantee it will respond in kind – and don’t assume that you will get a fair trial, he says. “They have the power and authority to do whatever they want to do. In less than three months, our government put one of the world’s most effective and profitable international accounting firms out of business."