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Corporate Finance Opportunity Detected

New SEC interpretative guidance and AS5 give companies and auditors a chance to make internal controls more efficient.

December 2007
by Samuel Fogleman, Bryce Peterson, et. al/Journal of Accountancy

Tired of the high cost of SOX 404 compliance? Here is some good news. The Security and Exchange Commission’s (SEC’s) new interpretive guidance and the Public Company Accounting Oversight Board’s (PCAOB’s) new Auditing Standard no. 5, An Audit of Internal Control Over Financial Reporting That Is Integrated With an Audit of Financial Statements, are intended to reduce the amount of money it takes your organization to comply with section 404 of the Sarbanes-Oxley Act of 2002.

Controversy over the implementation of SOX 404 has led the SEC and the PCAOB to two basic, but important, conclusions:

  • SOX 404 has produced significant benefits, including a stronger focus on corporate governance and higher quality financial reporting.
  • These benefits, however, have come at a significant cost.

Read the full article here.