Business Notes BANKRUPTCY

While it was minding everyone else's business, Laventhol & Horwath apparently should have been minding its own. Last week Robert Levine, CEO and executive partner of the Philadelphia-based accounting firm, announced that gallons of red ink added up to a black day and that the company was filing for Chapter 11 protection from its hordes of creditors. Ultimately, it was neither creditors nor clients who pulled the plug on the failing firm; it was Laventhol's partners themselves. Confronted by an $85 million bank debt and enormous litigation costs, the partners decided they could not afford to save the firm. "My management team and I did all we could to avert this tragedy," moaned Levine, "but the clock ran out on us."

With its legendary aggressiveness, Laventhol accrued a record haul of $345 million from 50 offices across the country in fiscal 1990. But size was its demise. "In their quest for rapid growth, they took on some clients that they shouldn't have," says Arthur Bowman, editor of Bowman's Accounting Report, a trade newsletter, "either in industries that they didn't understand or clients who were running very risky ventures." But if the 360 Laventhol partners are licking their wounds, its 3,400 remaining employees are left with even less: job hunting in the emaciated financial industry. Some of the regional offices may now choose to join another large firm or go off on their own.