Question

You are a young accounting staff member at Wackyo.com, a publicly traded company that recently had its Initial Public Offering. When the corporation recently “issued earnings guidance” for the upcoming quarter, you noticed that the company had assumed that sales would increase by 6%, and certain expenses would remain fixed costs. You were quite certain that these costs were variable, not fixed, but your supervisor told you to “fuggetta-bout it.” You plan to share your concerns with the SEC and do not intend to first go to the company’s Audit Committee.

a. Do you qualify as a whistleblower under the Dodd–Frank Act?

b. Do you qualify for protection against employer retaliation?

c. Did the company overstate or understate its earnings guidance?

d. If the company had understated its earnings guidance, would you have been equally likely to become a whistleblower?

Answer 1

Answer

a) Yes

b) Yes

c) yes ofcourse follow the guidelines and increase the variable cost.

d) Yes