As auditor Arthur Andersen LLP continues to implode, time is running out if there is to be any chance to save the firm in the States. Partners are thought to be increasingly feeling that their only option is now to accept responsibility for the shredding of Enron-related documents.
Andersen's position is even more untenable after David Duncan, a former firm partner, pleaded guilty to obstruction of justice charges in connection with the Enron scandal. He is now thought to be cooperating with federal investigators.
It is now believed that should Andersen admit wrongdoing, then the US Justice Department may well agree to place the firm on probation and defer any financial penalties.
There is a growing feeling in America that thousands of employees of the firm in the States are becoming innocent victims as a result of the affair and that they should be given the opportunity to help the business survive and hopefully preserve their jobs.
In a related story, Stagecoach, the transportation group, is the latest client to drop Andersen as auditor. It claims that the firm is no longer able to service its international needs.
PriceWaterhouseCoopers will take over the global audit.