Question

Sharon, a CPA for a large firm noticed that the company's accounting records drastically overstated the amount of inventory on hand, which led to overstating the assets of the firm. Initially, she brought it to the attention of her supervisor, but when nothing was done to correct the mistake in a timely manner; she decided the best course of action was to report it to the appropriate government official. Although her actions took her outside the company, she was counting on current law, under the ____________ to protect her against company retaliation.

Answer 1

Answer:

The Whistleblower Protection Act of 1989

Explanation:

The Supreme Court established that the Whistleblower Protection Act of 1989 covered not only employees from government entities, but also employees from private organizations (Lawson v. FMR LLC, March 4, 2014).

Whistleblowers are employees of private businesses or government entities that report illegal activities carried out by their employers. This law protects whistleblowers against possible retaliation from their employers.  

Answer 2

Answer:

Sarbanes-Oxley Act

Explanation:

The Sarbanes-Oxley Act of 2002 is a federal law that helps to audit and regulate financials for public companies.

It cracks down on corporate fraud.  It banned company loans to executives and gave job protection to whistleblowers. The Act gives power to the independence and financial literacy of corporate boards.

Lawmakers created the legislation specifically to help shield shareholders, employees and the public from accounting errors and fraudulent financial practices.

Former U.S. President George W. Bush, who signed the act into law on July 30, 2002, called the act "the most far-reaching reforms of American business practices since the time of Franklin Delano Roosevelt."