Disney whistleblower accuses company of improperly reporting revenue

News

ORLANDO, Fla. (WESH) – Just as Disney World is preparing to unveil Star Wars: Galaxy’s Edge, it’s facing allegations that it’s not properly reporting theme park and resort revenue to regulatory and government agencies.

The story was first reported Tuesday by MarketWatch, the financial news arm of Dow Jones.

Francine McKenna reported that a former senior financial analyst with Disney, Sandra Kuba, claims she filed a whistleblower complaint alleging “The parks and resorts segment systematically overstated revenue by billions of dollars by exploiting weaknesses in the company’s accounting software.”

McKenna told WESH 2 News that Kuba alleges Disney “collected the sales tax from the customers but then they reported to the government that the revenue was from things that were taxed at a much lower rate.”

The result, according to McKenna, is that Disney was underpaying sales taxes.

Disney replied in a statement Tuesday, calling the claims false.

“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. It is unfortunate that MarketWatch, which has been aware of the facts for months, knowingly and deliberately chose to give Ms. Kuba’s unfounded claims a platform.”

McKenna reports, “another alleged action Kuba described in her SEC filing involved recording revenue for $500 gift cards at their face value even when guests paid a discounted rate of $395.”

“It warrants attention again just based on the figures mentioned in the report,” said Joe Debello, a local financial expert.

Debello said the allegations demand complete federal and state investigations, but he cautions investors about overreacting.

“It’s really important for anyone who has a stake in Disney, whether that’s through their corporate retirement plan that is offered by work, or an individual shareholder, that they allow this to play out and that they don’t react too swiftly one way or the other,” Debello said.

The Securities and Exchange Commission does not comment on whistleblower reports until investigations are complete.

Copyright 2020 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Top Videos

Hasbro launches website to keep families busy

Thumbnail for the video titled "Hasbro launches website to keep families busy"

USF's food pantry helps fight food insecurities amid pandemic

Thumbnail for the video titled "USF's food pantry helps fight food insecurities amid pandemic"

1 dead, 2 injured in Lakeland crash

Thumbnail for the video titled "1 dead, 2 injured in Lakeland crash"

Wednesday Midday Weather Update

Thumbnail for the video titled "Wednesday Midday Weather Update"

Two cruise ships with Floridians board stuck at sea with deceased and sick passengers

Thumbnail for the video titled "Two cruise ships with Floridians board stuck at sea with deceased and sick passengers"

Gov. DeSantis addresses cruise ships looking to dock in Florida

Thumbnail for the video titled "Gov. DeSantis addresses cruise ships looking to dock in Florida"

Trump says he will speak with DeSantis about cruise ships

Thumbnail for the video titled "Trump says he will speak with DeSantis about cruise ships"

What money is out there for struggling small businesses?

Thumbnail for the video titled "What money is out there for struggling small businesses?"

Coronavirus test results delayed up to 14 days in Florida

Thumbnail for the video titled "Coronavirus test results delayed up to 14 days in Florida"

Better Call Behnken helps Port Richey woman get assurance her power won't be disconnected

Thumbnail for the video titled "Better Call Behnken helps Port Richey woman get assurance her power won't be disconnected"
More Local News

Trending Stories

get the app

News App

Weather App

Don't Miss

More Don't Miss