Monday, September 27, 2004

Frances, SOX and Inevitability

As the November 15 deadline looms for SOX compliance, Big Four firms have been working overtime with their larger audit clients on their financial reporting systems to meet that date.

As a result, the combination of manpower shortages and cost-efficiency has prompted the global firms to, well, jettison smaller (read: less profitable) clients in favor of their larger blue-chip counterparts.

Now you didn't have to cover, or, for that matter work, in the profession very long to see this trend coming, but apparently, Donald Nicolaisen, the chief accountant the Securities and Exchange Commission, is a bit concerned.

He castigated the firms for "running away from the marketplace" and urged them not to use SOX as "a convenient tool" to manage their businesses.

When SOX was first signed into law, many accounting and financial publications (including ours) featured articles and numerous consultant predictions that this was going to be the future of auditing for SEC issuers.

Frances, SOX and Inevitability

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