Whistleblowing

The "Persons of the Year" honored in 2002 by Time magazine (Dec. 30, 2002) are called whistleblowers. That issue of Time provides comprehensive coverage about those whistleblowers and the organizations they blew the whistle on: Sherron Watkins, Enron; Coleen Rowley, Federal Bureau of Investigation; and Cynthia Cooper, WorldCom.

The fate that awaits whistleblowers is tough. They are unlikely to be called diligent CPAs, but rather "snitches." They will not likely be portrayed as "team players," but rather disgruntled employees. They often lose friends, lose careers, and endure significant personal stress. Some might argue that whistleblowers such as Sherron Watkins, of Enron, have benefited in lucrative speaking engagements and book deals, but Sherron Watkins' situation is atypical.

If CPA employees follow interpretation 102-4, there is a significant possibility that they will be labeled snitches for doing their jobs and will suffer as an employee. But if they choose to be silent, CPAs violate their consciences and the ethical standards of the accounting profession.

The AICPA has provided guidance to whistleblowers in the form of a decision tree. The decision tree is useful in that it gives guidance on what party to talk to next. But providing the current decision tree to a CPA who finds misrepresentations in financial statements is like handing a tourist a map of New York City and wishing him luck. A tourist needs more than a map; he needs practical advice on how to negotiate the city, and warnings of possible pitfalls. Likewise, CPAs need practical advice on how to negotiate the decision tree and how to be alert to the possible dangers, before they begin this monumental task. Their careers and personal lives are at stake.

By providing CPAs with guidance that properly balances their personal welfare with their professional responsibility, and working to change an unfair characterization of loyal employees as whistleblowers, the AICPA would promote fewer ethics violations and encourage more transparent reporting in financial statements.


FindArticles - Professional Responsibility and the Fate of Whistleblowers
CPA Journal, The, Apr 2006, by Gabbin, Alexander L,
Richardson, Robert C