A series of whistleblower tips claim that Disney has been inflating revenue for years. Former senior financial analyst for Disney, Sandra Kuba, recently came forward claiming that Walt Disney Company employees have systematically overstated revenue, by billions of dollars.
2019 has been a crucial year for the Mouse House. Disney and their properties have numerous reasons to celebrate, including the opening of Star Wars: Galaxy’s Edge, Disney’s acquisition of FOX, the launch of streaming service Disney+ in November, and the D23 Expo on the horizon. In 2018, Disney CEO Bob Iger reported that the cash flow conglomerate beat Wall Street forecasts by raking in 50 percent more in profits than years prior. Disney attributed the record-breaking numbers to the exceptional performances of films such as Black Panther, The Incredibles 2, Avengers: Infinity War, and Star Wars: The Last Jedi.
However, a whistleblower claims that Disney has been using dishonest tactics to boost revenue numbers. According to Variety, Disney’s annual revenue could’ve been overstated by as much as $6 billion dollars. Kuba, who worked in the company’s accounting department for almost two decades, claims the parks and resorts have cooked the books for quite some time. Allegedly, employees report revenue for complimentary items such as golf rounds and special promotions. Furthermore, Kuba’s tips state that theme park employees log in gift card purchases twice, and revenue is counted even when a gift card is presented to a guest at no charge. Reportedly, Kuba was fired from her Disney position shortly after filing her complaints. A Walt Disney Spokesperson shared the company’s thoughts on the matter:
Since the unveiling of the complaints filed with the U.S. Securities and Exchange Commission, Disney has experienced a slip in stock shares. Clearly, the reports have rattled investors. Kuba has withdrawn her claim challenging her termination from Disney, and the SEC continues to inquire about the alleged inflation of revenue.
This former employee, who was fired for cause, has persistently made patently false claims for over two years. The claims she made to the company were thoroughly investigated and found to be utterly baseless.
Since its conception in the 1920s, the Walt Disney Company appears to promote nobility, honesty, and integrity. These values have been integral in the theme parks and Disney’s blockbuster films. Overall, Disney is a business that other markets around the world watch, and learn, from. It remains to be seen if the allegations of inflated revenue are true until a more thorough investigation provides answers. Disney continues to plunge forward with their eventful year and packed slate of highly-anticipated projects.
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Source: Variety
