USA Is my boss shady?


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I’m a controller for a $60m professional services co. We are a subsidiary of a larger company who is PE backed.

I report directly to CFO - this is my first job in industry, I was previously an auditor. The only people above my boss are the CFOs at our parent company who I have no contact with.

My CFO asked me to make some year end adjustments that, IMO, are sketchy - so that we hit our projected EBITDA. Reversing negative adjustments to revenue, overaccruing receivables, under accruing liabilities etc. He always comes up with some weak rationale, think there is about $2m on our balance sheet that we can’t substantiate. As a former auditor I know what is good support and we don’t have it. Our EBITDA was around $15m (as we projected to the PE firm) when I think it should be $12-$13m - for reference.

The parent co is audited but we are one of many subs - one of the larger subs - but the overstated assets are not material to the consolidated FS (or so my boss thinks - as this is his rationale for these sketchy adjustments). My point back to him is that materiality goes out the window if there is a consequence that matters to someone by not hitting your projected EBITDA. I was not given a solid answer on what happened if we didn’t hit EBITDA, although I asked. My assumption is that his significant bonuses are tied to the result.

I’m hesitant to throw out the F word but it’s feeling pretty sketchy to me at this point. But with no prior exp in industry, I don’t know if I’m overreacting and it’s normal to mess with the numbers. My judgement could be clouded by the fact that I also really don’t like him as a person.

To cover my butt, I sent him an email and blind copied one of my peers with year end “passed adjustments” we need to make. He is the final decision maker but I didn’t want this coming back on me if the audit or corporate blows it up.

Thoughts? Am I too sensitive?
 
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kirby

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First off, it is NOT normal to mess with the numbers.

By sending the CFO an email as you described you ensured that the problem is off your plate. To go further and make those correcting passed adjustments entries on your own is insubordination. So you have done all you can.
Next though is that you dislike the CFO, clearly for good reason. You might as well explore finding a new job.
 
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First off, it is NOT normal to mess with the numbers.

By sending the CFO an email as you described you ensured that the problem is off your plate. To go further and make those correcting passed adjustments entries on your own is insubordination. So you have done all you can.
Next though is that you dislike the CFO, clearly for good reason. You might as well explore finding a new job.
Thank you for replying - my gut was right. Yes I am exploring other options
 
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Does the Parent Company has a Whistleblow System in place? My proposal is to utilize this platform to Whistleblow on this - I am not exactly sure how the laws work where you are but by posting these entries, knowing full well they are not properly supported, does this implicate you with an impact on your reputation.
 
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Does the Parent Company has a Whistleblow System in place? My proposal is to utilize this platform to Whistleblow on this - I am not exactly sure how the laws work where you are but by posting these entries, knowing full well they are not properly supported, does this implicate you with an impact on your reputation.
This thread is a few weeks old now but as an update: I did blow the whistle on the entire thing - my boss was terminated and I was treated great through the entire process - no blame on me at all. I did end up finding a new job though as I found out that the CEO of the sub knew about this before he hired me - so I wanted to leave the entire organization because it gave me bad vibes.
 

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