Monday, November 26, 2007

Corporate America Making Strides on Sarbanes-Oxley Compliance, According to Compliance Week Benchmarking Report

Compliance Week, a magazine and newsletter on corporate governance and compliance, today announced the results of a study of financial reporting and corporate risk areas across a wide range of industries. The results show that Corporate America is making marked improvements in regulatory compliance despite persistent problems.

The “2007 Financial Reporting & Internal Control Benchmarking Reports” are available to members of the press on a limited basis.

The same issues that dogged companies when The Sarbanes-Oxley Act first came into effect three years ago—poor documentation of accounting procedures, insufficiently trained accounting and finance staffs, and difficulty closing the books at year-end—still flummox companies as they try to comply with SOX today. But the total number of such “material weaknesses,” which must be disclosed under Section 404 of the law, has plunged from 537 such disclosures in “Year One” to only 173 in “Year Three.”

“The data clearly show that after three years, corporations are doing a much better job identifying and remediating problems,” said Matt Kelly, managing editor of Compliance Week, who spearheaded the research.

“Executives might not like Sarbanes-Oxley,” added Kelly, “but they’re certainly getting better at addressing its challenges. The benchmark reports’ data will prove useful to these companies as they look to uncover hidden risks that are common in their industry.”

Corporate America Making Strides on Sarbanes-Oxley Compliance, According to Compliance Week Benchmarking Report

Labels: benchmark, material weakness

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