May 1, 2008
Sarbanes-Oxley Compliance Costs Decline
A survey of 185 companies by Financial Executives International found that compliance costs for Sarbanes-Oxley's internal controls audit requirements, Section 404, had declined 5.4% last year. Total audit costs were up 2%, however. The data will give some solace to SOX supporters. It does not affect the basic argument against Section 404 however: 1) The SEC vastly underestimated the costs of Section 404; 2) The current costs of Section 404 still hovers around $850,000 per firm -- nearly 25% of total audit fees; 3) The early costs of Section 404 were in the million per firm; 4) Small companies are still exempted by SEC order because they simply cannot afford to comply; and 5) Section 404 has not stopped the current sub-prime mortgage crisis or any other major financial crisis (it does catch shortfalls in penny cash discretionary accounts, however). In short, the section is still a disaster and should be repealed.
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The issue of SarOx (and other long standing laws) against big league hitters going from on entity to another, walking through the Bankruptcy process, has long been over looked and at great material adverse harm to the public, ignored.
It is a crime for anyone or thing to travel from one bankrupt public entity to another.
The scenario has gotten so out of hand, the perpetrators now seek companies to push into bankruptcy, after placing in key personnel, to assure that the sharks can have their way.
Posted by: Laser Haas | May 5, 2008 3:30:57 PM
What is the current status of Section 404 in May 2009?
Posted by: kelterer | May 12, 2009 7:45:13 AM