SEC Grants SOX Reprieve
Small, public companies have gotten yet another reprieve from having to comply with the Sarbanes-Oxley Act of 2004, thanks to last week's decision by the Securities and Exchange Commission to delay requiring small public companies to comply with SarbOx and its complex Section 404.
The SEC's decision-to delay compliance for one year, until fiscal years ending on or after Dec. 15, 2009-is largely thought to be due to the complexity, confusion and expense around Section 404, which requires that businesses implement strict internal controls and financial reporting measures.
"There has been tremendous push-back from business leaders in this segment regarding cost versus benefit of SarbOx Section 404 compliance," said John Hagerty, a vice president with AMR Research. "Primarily, it's an issue of cost and the burden it will place on smaller firms that will have to spend a larger ratio of total revenue than their larger brethren."Read the full story here.