December 20, 2004
Should Rules be Changed for Small Companies?
The SEC is taking a second look at small company impact from Sarbanes-Oxley costs. This is an interesting dilemma. Small companies could have the same negative impact on investors that large companies can have: they both take the public's money. But obviously, we do not want to squash the future "large" companies. It will be interesting to see how this is handled. The bottomline is that all companies, regardless of size, should have proper internal controls. In my experience, it is easier to commit fraud than in small companies than large ones because there are usually fewer controls and people. More control is usually held by fewer people-therefore, more ease in committing fraud.
This article outlines the concerns here:
"SEC to study small companies' Sarbanes-Oxley costs
By Joel Rothstein
WASHINGTON, Dec 16 (Reuters) - A panel to examine whether small public companies are being forced to bear exorbitant costs to meet corporate reforms enacted in 2002 was announced by the U.S. Securities and Exchange Commission on Thursday.
Companies have complained that the Sarbanes-Oxley Act imposes excessive requirements for corporate disclosure, maintaining internal controls over financial reporting, and access to capital markets, areas on which the new panel may recommend rule changes.
The panel will be co-chaired by attorney Herbert Wander of Katten Muchin Zavis Rosenman, and James Thyen, president and chief executive officer of Kimball International Inc. (KBALB.O: Quote, Profile, Research) , an Indiana-based furniture and electronics maker.
The SEC said between nine and 19 additional members will be appointed. The panel is due to report its findings by January 2006.
SEC Chairman William Donaldson told reporters the commission was not trying to roll back the Sarbanes-Oxley law, that grew out of accounting scandals at Enron Corp. (EONPQ.PK: Quote, Profile, Research) and WorldCom, now known as MCI (MCIP.O: Quote, Profile, Research) .
But Donaldson said the agency has leeway to move rules around to lessen the burden on small companies." For the complete article, click here.
To learn more about how to rapidly and affordably comply with Sarbanes-Oxley, see www.issuescentral.com or call (416) 977-1496.
This article outlines the concerns here:
"SEC to study small companies' Sarbanes-Oxley costs
By Joel Rothstein
WASHINGTON, Dec 16 (Reuters) - A panel to examine whether small public companies are being forced to bear exorbitant costs to meet corporate reforms enacted in 2002 was announced by the U.S. Securities and Exchange Commission on Thursday.
Companies have complained that the Sarbanes-Oxley Act imposes excessive requirements for corporate disclosure, maintaining internal controls over financial reporting, and access to capital markets, areas on which the new panel may recommend rule changes.
The panel will be co-chaired by attorney Herbert Wander of Katten Muchin Zavis Rosenman, and James Thyen, president and chief executive officer of Kimball International Inc. (KBALB.O: Quote, Profile, Research) , an Indiana-based furniture and electronics maker.
The SEC said between nine and 19 additional members will be appointed. The panel is due to report its findings by January 2006.
SEC Chairman William Donaldson told reporters the commission was not trying to roll back the Sarbanes-Oxley law, that grew out of accounting scandals at Enron Corp. (EONPQ.PK: Quote, Profile, Research) and WorldCom, now known as MCI (MCIP.O: Quote, Profile, Research) .
But Donaldson said the agency has leeway to move rules around to lessen the burden on small companies." For the complete article, click here.
To learn more about how to rapidly and affordably comply with Sarbanes-Oxley, see www.issuescentral.com or call (416) 977-1496.
