Tuesday, November 23, 2004

Firms Cram for a Passing Sarbanes Grade

Hundreds of public companies soon may get a failing grade on a key Sarbanes-Oxley-related report. As disturbing as that may sound, some observers are more worried about how investors will react to such news. Many observers consider the reports, which were intended to prevent the next Enron debacle, to be the key provision of the Sarbanes-Oxley Act. But some accounting experts and regulators are warning investors that just because a company turns in an imperfect report doesn't mean it's a corporate scandal in the making.

"It's important that investors have an understanding of what the material weakness is," said Erica Sulkowski, a spokeswoman for the Securities and Exchange Commission. "If the reaction to a material weakness is that everybody sells without regard to the substance of [them] , that could be problematic."

But some corporate watchdogs think companies have little excuse for the poor reports, which concern a company's so-called internal controls.

Firms Cram for a Passing Sarbanes Grade

Send to a friend:

0 Comments:

Post a Comment

<< Home

Previous articles

Better Governance and Reporting Under Sarbanes-Oxl...

Line56.com: Technology Rising for SOX

Price of Regulatory Compliance Skyrockets, Accordi...

BT chairman slams cost of Sarbox

Sarbanes-Oxley: Compliance Issues Can Mean Busines...

U.S. Workers and Investors Largely Unaware of Sarb...

Whistleblower Law: A Guide to Legal Protection for...

Sarbanes-Oxley -- compliance or excellence?

Ingersoll-Rand Selects OpenPages SOX Express for S...

Restoration Hardware shares drop on loss, outlook