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Charles Niemeier |
“The reports of my death are greatly exaggerated” – so said Mark Twain, the American writer, following the premature publication of his obituary in the New York Times. Can the same be said about the Sarbanes-Oxley Act?
Following speculation, based on comments from George Bush, Henry Paulson and others, that Sarbanes-Oxley (SOX) would be greatly reduced in requirements, at least for small cap companies and foreign listers, the Public Company Accounting Oversight Board (PCAOB), the body set up by the SEC to oversee the implementation of SOX, has come out heavily against any weakening of the Act.
According to a Reuters report, last week, Charles Niemeier, a PCAOB board member, told an audience at panel discussion titled "The Burdens of Regulation: Are the U.S. Capital Markets Less Competitive?" sponsored by the New York Society of Security Analysts, that rolling back SOX and other securities laws could damage the reputation and competitiveness of US markets.
He is quoted as saying "I don't believe that 'regulation light' is an answer. We're looking at an interesting time in where these markets are developing in other countries. It would put us in an extremely dangerous position to have lowered our standards in the United States." He went on to say “If we start tweaking, are we putting at risk the one thing that gives us a true competitive advantage in the world?".
In a separate survey, released yesterday by AMR, it was reported that, contrary to expectations, SOX spending was not reducing, but would stabilise at $6 billion in 2007. Despite anticipated reductions in requirements US companies did not see many savings, with SOX spending remaining at about 20 % of the US’s overall compliance, governance, and risk management spending of $30 billion annually.
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