From the Help/FAQ section of the site:
Q: What is the Whistle and what does it do?
A: Due to the large amount of abuse to Newgrounds by malicious users we have implemented features that allow users to help police the site. A user's Whistle level can go up or down depending on how accurately the user flags questionable content. If a user abuses their use of the whistle to flag portal entries and reviews that do not violate our terms they will lose points and eventually be stuck with a broken whistle.
Users with broken whistles have no effect on anything they attempt to flag.However, users with a broken whistle may still receive negative or positive points so they can either dig themselves a deeper hole or try to regain a normal level and effectively flag entries once again. Users who blow the whistle accurately many times can increase their whistle level to bronze, silver, gold or deity levels. Users with a higher whistle level pull more weight when they use it.