Speculation over the future of IPG, which operates media agencies Universal McCann and Initiative in the UK, reached fever pitch last week after two of the advertising giant's top media executives stepped down suddenly.
Highlighting the company's accounting issues and its nearly £2.3bn in media buying reviews underway with L'Oréal and General Motors, Lauren Rich Fine, chief financial analyst at Merrill Lynch, said: "The company has lost several media buying accounts over the past few months already and not knowing what the problem is, we're not convinced there is an easy fix.
"We have concerns that more clients will lose faith and put their accounts under review."
In the UK, Initiative – whose clients include General Motors and Tesco – is the sixth-largest agency in terms of billings, according to Nielsen Media Research. Universal McCann, the UK's number-eight agency, holds the Coca-Cola and Mastercard accounts, as well as L'Oréal.
IPG's tarnished accounting image suffered a further setback last Thursday when it announced that it is unable to say when it will file its 2004 annual report or post fourth-quarter earnings.
The week before, the agency network had announced that it may have to restate its financial results for 1996 to 2001 because the company might have improperly consolidated accounts from acquired companies. Revenues of nearly £76m and profits of £13m are in question.
It would be the second time in just over two years IPG has had to restate financial results.
Describing IPG's restatement issues as "a real negative", JPMorgan analyst Frederick Searby said: "We believe the market will view this as a significant disappointment as IPG had supposedly gotten past its restatement phase."
And rating IPG's shares as "high risk", Citigroup Smith Barney analyst William Bird said Interpublic has other worries too: "Currently, there are a number of shareholder lawsuits against Interpublic and we believe that the company could be exposed to potential liability and high litigation costs as a result."
The abrupt departures last week of Marie-José Forissier, chairman of Initiative Worldwide, and Universal McCann global chief executive Robin Kent signal that Interpublic chief executive Michael Roth's long-awaited reorganisation of the network may already be underway.
Forissier was replaced by Initiative chief executive Alec Gerster and, in the interim, Universal McCann chief operating officer Murray Dudgeon has taken on Kent's role. Roth, who had been sole chairman of Interpublic, stepped into the CEO's role in January after his predecessor, David Bell, became co-chairman.
Interpublic's UK operation has not seen any moves at the top level, but there is no guarantee that changes won't ripple down.
One global agency chief said: "Overall, the vitality of the UK companies will be directly affected by the leadership they put in place in Europe and worldwide."
Another boss at a UK media agency said of his Interpublic rivals: "At the moment there is no direction for them and no IPG policy."
A merger between Universal and Initiative is not believed to be part of Roth's strategy although it is understood that they are looking to fill the newly created role of global head of media that will span both the networks.
The swift departures of Forissier and Kent has left international agency bosses somewhat baffled as to what Roth's long term plan for the network is and how far he plans to go with the restructuring of the network.
One global agency chief executive said: "It [the restructuring] has been very badly managed. If you are doing these types of things, you have to be clear about your position in the marketplace and know who your team is. Otherwise you're going to look disorganised – which is how they are looking right now."
He added: "They should declare how they are going to run their media business and work out who should run it. If I were them, I would appoint one person to look after their media assets and then I would have him or her reporting to the chairman."
Another agency boss added that the network was suffering the after-effects of not concentrating on the media side of the business.
"There is no one at Interpublic pulling media together. They basically have the mentality of a creative agency while media is the bit at the end. What they need to do is get off their arses, employ some top-level media people and give them a place at the top table."
In the statement released last week, Interpublic said it would host a conference call on 5 April to "update investors and answer questions" and, despite the recent difficulties facing the agency, Roth remained optimistic.
"The filing delay is not related to the high quality of our professional offerings, as evidenced by recent significant account wins.
Nor is it a reflection of our company's true potential."
Summing up the difficult position that IPG is facing, a global agency boss said: "Managing an advertising business is tough, but managing a declining business is a bloody nightmare.
"As soon as you lose confidence and are having to get rid of people, you've got clients at risk.
When clients are at risk, they don't want to be with a losing agency and it's a combination of uncertainty over the key management and financial irregularity.
"If you have a situation with a big review, it really stacks cards against you."
? Intel global account (McCann Worldgroup) – £155m in billings.
? General Motors media account in Europe retained (Initiative and Universal McCann) – £400m.
? Unilever pan-European media account (Initiative) – £555m in billings. Estimated £10m-£13m in lost revenues, according to Merrill Lynch.
? Nestlé global media (Universal McCann) –Merrill Lynch estimates agency's share worth more than £200m in billings or an estimated £8m in lost revenues.
? L'Oréal is reviewing its £800m global media account, split between Universal McCann and ZenithOptimedia ? GeneralMotors is reviewing its £1.5bn US dealership account, worth an estimated £21m to £26m in revenues, according to Merrill Lynch.