Who is most likely to be the whistle-blower in a corporation??
August 21, 2009...There's no question that whistleblowers, employees who bring concealed misconduct to the attention of superiors, work in the financials departments at a company but aren't typically the CFO. It is often controllers, assistant controllers, assistant treasurers, and senior bookkeepers who "blow the whistle" because of their understanding of the links between the company's financials and the processes and transactions that go into financial statements. These employees raise concerns about how numbers, figures, and calculations that don't quite make sense, may develop into a larger problem, or are flat out wrong.
This was the case at Enron, where former vice president Sherron Watkins warned that the company "had a hole in the ship and was going to sink" after scrutinizing its assets against accounting standards. Consequently, Enron declared bankruptcy in December 2001, rendering thousands unemployed and resulting in millions of dollars in losses for investors.
Once a whistleblower voices a financial, legal, or ethical violation, immediate action must be taken by investigating, preserving evidence, establishing audit trails to prove or disprove fraud or other misconduct, determining damages, installing procedures and controls to mitigate further misconduct, and preventing retaliation.
Steve Lee, Managing Partner at Steve Lee & Associates can be contacted at: stevelee@stevelee.com.
This was the case at Enron, where former vice president Sherron Watkins warned that the company "had a hole in the ship and was going to sink" after scrutinizing its assets against accounting standards. Consequently, Enron declared bankruptcy in December 2001, rendering thousands unemployed and resulting in millions of dollars in losses for investors.
Once a whistleblower voices a financial, legal, or ethical violation, immediate action must be taken by investigating, preserving evidence, establishing audit trails to prove or disprove fraud or other misconduct, determining damages, installing procedures and controls to mitigate further misconduct, and preventing retaliation.
Steve Lee, Managing Partner at Steve Lee & Associates can be contacted at: stevelee@stevelee.com.
