The US Senate Banking Committee has passed
legislation that will permanently exempt small listed companies
from complying with Section 404(b) of the Sarbanes-Oxley (SOX)
Act.

SOX Section 404(b) requires US listed
companies to implement and report on internal controls, and have
these reports audited.

The US Securities and Exchange Commission
(SEC) previously delayed the implementation of 404(b) for companies
with a market capitalisation of less than $75 million – known as
non-accelerated filers – to allow them added time to prepare.

The final deadline for implementation was 15
June this year.

Despite earlier pressure from lobby groups
such as the Center for Audit Quality and the CFA Institute for the
committee to resist SOX exemption, the the Dodd-Frank BIll was
passed and is expected to be signed into law by President Barack
Obama.

BDO US said the bill could potentially be
expanded to exempt larger businesses from complying with Section
404(b) because it requires the SEC and the comptroller general to
determine, in the coming months, how to reduce compliance costs for
companies whose market capitalisation is between $75m and
$250m.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

“While we firmly believe that all public
companies can benefit from strong internal controls, the inclusion
of Section 989G in the new law demonstrates that Congress is paying
attention to the pleas of smaller public companies to reduce their
compliance costs in a weak economy,” BDO US national SEC director
Wendy Hambleton said.

 

Related articles


Lobby groups urge Senate to resist SOX exemption


CAQ defends Sarbanes-Oxley Act


Sarbanes-Oxley comes under fire in US High Court and
Congress