Tuesday, February 27, 2007

Kerry, Snowe Urge Sarbanes-Oxley Extension for Small Firms

Today Senators John Kerry (D-Mass.) and Olympia J. Snowe (R-Maine) called for a delayed
implementation of the Sarbanes-Oxley Section 404 requirements for small public firms to ease the burden on complying with the expected new auditing
standards. Section 404 requires firms to establish internal control frameworks and to file internal control reports. The Securities and
Exchange Commission (SEC) and the Public Company Accounting Oversight Board (PCAOB) proposed rules and guidance late last year addressing this section
and are accepting public comments through Monday, February 26th.

"We can have strong corporate accountability standards while also reducing the burden for small firms who spend more time and money earned
than big companies to comply with Sarbanes-Oxley," said Kerry. "We must do everything possible to appropriately reduce red tape in order for small
firms to grow and become dynamic public companies."

A recent Government Accountability Office (GAO) report requested by Senators Snowe and Mike Enzi (R-Wyo.) found that small public companies
spend considerably more on implementing Sarbanes-Oxley, particularly Section 404. The report found that firms with less than $75 million in
market capitalization were spending 877 percent more than larger counterparts -- $1.14 in audit fees per $100 of revenue, compared to just
$.13 per $100 for firms with greater than $1 billion in market capitalization.

Kerry, Snowe Urge Sarbanes-Oxley Extension for Small Firms

Labels: extension, implementation, sarbanes oxley, small business

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