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1.36 DEMAND FOR ASSURANCE LO6 In 2002, the audit firm Arthur Andersen collapsed following charges brought against it in the United States relating to the

1.36 DEMAND FOR ASSURANCE LO6

In 2002, the audit firm Arthur Andersen collapsed following charges brought against it in the United

States relating to the failure of its client, Enron. Some other clients announced that they would be

dismissing Arthur Andersen as their auditor even before it was clear that Arthur Andersen would not

survive.

Required

Using the theories on the demand for audits, explain some reasons why these

clients took this action

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