Accounting News

Wednesday, December 12, 2007
SOX 404 Requirements Delayed for Small Business

Securities and Exchange Commission Chairman Christopher Cox today announced that the SEC is delaying 404b requirements from Sarbanes-Oxley (SOX) for the smaller public companies. The delay is to further investigate the costs of implementing the rule.

SOX was designed to prevent the accounting fraud from the Enron scandal. However, some of the laws provisions, disproportionately impact smaller companies. A coalition of small business groups performed an analysis of SOX compliance and found that compliance will cost more than 3 percent of their net income.

This information conflicts with Congress's intent to not overly burden business with compliance costs.