Sarbanes Oxley Boeing Essay

631 WordsAug 8, 20123 Pages
Boeing Auditors Not Protected by Sarbanes-Oxley In the past decade, a variety of companies and employees have lost their reputations, money, and jobs due to engaging in wrongful business practices. Companies like Enron, Tyco International, Adelphia Peregrine Systems, and Worldcom are some of the most commonly known. Their downfall was widely publicized all over the media because of how they wrongfully reported numbers and figures on their balance sheets and income statements. This caused an outcry by the media and eventually led to the creation of the Sarbanes-Oxley Act of 2002. The main intent of this act was to prevent other companies from misleading investors by reporting fraudulent information. To this day debate still continues on about whether the Sarbanes-Oxley acts benefits are outweighing the costs, and whether or not the act is fulfilling its main intention. Some employees may fear backlash from upper management which could get them fired which is what actually happened to two former Boeing employees. In 2007 two former employees at Boeing, Matthew Neumann and Nicholas Tides, were fired for disclosing their concerns about company practices to a newspaper reporter. The employees retaliated by filing a lawsuit claiming that their firings violated Sarbanes Oxley. The lawsuit was originally dismissed and they filed for an appeal in the United States Court of Appeals in San Francisco. Despite their persistence a three judge panel recently upheld the decision of Boeing to fire the employees. The judge’s decision to uphold the decision was based on the fact that “unlike the federal Whistleblower Protection Act, Sarbanes-Oxley only protects employees when they disclose information about alleged securities violations to supervisors, federal regulatory investigators or Congress” (Gullo). Since they went to the media instead of their supervisors the court ruled

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