Individual investors in the US are confident
in audited financial information, a Center for Audit Quality survey
has found.
For the third year in a row, 75% of
respondents to the Main Street Investor Survey said they have
confidence investing in US public companies. Similarly, investor
confidence in audited financial information released by public
companies remained strong at 70%, unchanged from last year.
When asked who does the best job of protecting
their interests aside from themselves, 32% of investors cited
public company auditors as their first or second choice, with 16%
of respondents selecting auditors as the single group that does the
best job.
The newly-enacted Wall Street Reform and
Consumer Protection Act exempted companies with market
capitalisation of less than $75m from compliance with Section
404(b) of the Sarbanes-Oxley Act. Sixty-five percent of investors
said they were concerned that smaller companies will no longer be
required to have an auditor attest to and report on management’s
assessment of internal controls.
Even more investors were troubled about the
possibility of larger companies being exempted. Four out of five
respondents said they would be concerned should Congress expand the
exemption to companies with market capitalisation of $75 million or
more.
The survey of 1,001 investors was conducted in
July.
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