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Section 404

SEC Takes Tougher Stance Against Investment Advisers

Jaclyn Jaeger January 03, 2012

The SEC wrapped up 2011 with a series of enforcement actions against investment advisers, complete with allegations of deficient compliance programs, since investment advisers are legally obligated to maintain reasonable compliance procedures. "Not all compliance failures result in fraud, but many frauds take root in compliance deficiencies," says SEC Enforcement Director Robert Khuzami.

SEC Challenging Multinationals on Plans for Foreign Earnings

Tammy Whitehouse November 15, 2011

The SEC warned that if companies claim they are reinvesting foreign earnings outside the United States and avoiding the taxes to repatriate them, then they must provide more information to prove it and tell a consistent story to investors. "You have to be able to support that assertion," says Bob Norton, chief income tax officer at consulting firm Vertex. Details inside.

House Considers More 404(b) Audit Exemptions

Tammy Whitehouse September 22, 2011

Republicans in Congress have filed legislation to exempt far more businesses from Section 404(b) of the Sarbanes-Oxley Act, the onerous provision to get external audits of a company's internal controls. The bill would exempt companies with market capitalizations of up to $500 million, well beyond the $75 million market cap cut-off that exists today.

SEC Publishes Study on Auditing Internal Controls

Arielle Bikard April 25, 2011

The SEC has published yet another report mandated by the Dodd-Frank Act, this one concluding that companies with market capitalizations from $75 million to $250 million should not be exempt from compliance with Section 404(b) of the Sarbanes-Oxley Act, which requires an outside auditor's review of internal controls. The report could not say whether compliance costs discourage some small companies from going public. More inside.

Large Companies File Cleanest 404 Reports Ever in 2009

Tammy Whitehouse November 05, 2010

Companies continue to make improvements in internal control over financial reporting, with accelerated filers hitting an all-time rock-bottom rate of adverse opinions of only 2.4 percent. Smaller companies that file their reports on internal control without an audit also showed some modest improvements in the most recent year as well,...

As Congress Mulls SOX Exemption, Survey Suggests Acceptance

Tammy Whitehouse June 22, 2010

As Congress inches ever closer to permanently lifting the internal control audit requirement for smaller public companies, Protiviti has published its annual survey showing companies with compliance experience are starting to see the benefits.In its 2010 Sarbanes-Oxley compliance survey, Protiviti says 70 percent of executives in at least their fourth...

Moves and Counter-Moves on the Dodd Bill

Matt Kelly March 18, 2010

Sen. James DeMint, R-S.C., has promised to introduce an amendment to the Senate’s proposed regulatory reform bill that would exempt non-accelerated filers from compliance with Section 404(b) of the Sarbanes-Oxley Act.A Section 404(b) exemption for non-accelerated filers was notably absent from the reform bill unveiled by Christopher Dodd, chairman of...

Sen. Scott Brown, Part II: Enabling SOX 404(b)

Matt Kelly January 21, 2010

The other day I pondered whether the improbable ascendancy of Sen. Scott Brown, R-Mass., might delay or otherwise thwart Democrats' plans to overhaul financial regulation. Let's not forget one other niche of corporate compliance where Brown's arrival as the 41st Republican senator might have serious consequences.He might allow the dreaded...

SOX Efforts Could Be More Efficient, Poll Says

Tammy Whitehouse December 28, 2009

Nearly three-quarters of finance professionals participating in a recent poll said their efforts to comply with internal control reporting and auditing requirements could be more efficient.As part of its Inside Talk Webinar series, the Institute of Management Accountants and Ajilon Finance Solutions asked 210 accountants about their readiness to comply...

Data Says Audits Reduce Restatements, Speed Disclosures

Tammy Whitehouse December 03, 2009

Companies that file clean internal control reports without an audit opinion logged restatements at a 46-percent greater clip than companies with auditors, according to a recent analysis in response to possible Congressional action.Audit Analytics looked at the restatement history of companies that filed 2007 financial reports to look for differences...

CAQ Wraps Up AS5 Series for Smaller Companies

Tammy Whitehouse September 18, 2009

In the third of its three-part Webcast series on auditing internal control over financial reporting, the Center for Audit Quality provides some expert insight into how auditors should evaluate control deficiencies and wrap up the audit process.While that may be old hat for companies that have already experienced a few...

No Deferrals Expected for 404b Audits, CAQ Says

Tammy Whitehouse June 19, 2009

Smaller public companies looking for yet another deferral of the internal control auditing requirements of Sarbanes-Oxley should focus their efforts instead on getting ready for the audit.That’s the message from the Center for Audit Quality as it continues a three-part Webcast next week to help smaller companies’ auditors get up...

PCAOB Offers Advice to Auditors of Smaller Companies

Tammy Whitehouse January 27, 2009

Auditors of smaller public companies that have so far escaped the audit of internal control over financial reporting are getting new direction from audit regulators to assure the first audit is appropriate to the size and complexity of the company.The Public Company Accounting Oversight Board published guidance for auditors of...

SOX Lawsuit Keeps Refusing to Die

Matt Kelly November 19, 2008

From the I'd-rather-watch-paint-dry department: That conservative outfit still arguing that the Sarbanes-Oxley Act is unconstitutional has, yet again, lost a court dispute and vowed to appeal. Earlier this week, the U.S. Court of Appeals for Washington, D.C., voted 5-4 not to review the case, which argues that the structure of the...

Early Returns on Section 404

Matt Kelly November 05, 2008

One bit of political flotsam flushed away in last night's blue deluge: U.S. Rep. Tom Feeney of Florida. Feeney, a three-term Republican from central Florida, has been an outspoken critic of Sarbanes-Oxley and specifically of applying its notorious Section 404 provisions to small companies. Well, he lost last night. Democrat Suzanne...

Web Programs Help Steer Smaller Companies Into AS5

Tammy Whitehouse September 17, 2008

As smaller public companies and their auditors gear up for their first audit of management’s report on internal controls, learning opportunities abound.The Center for Audit Quality is hosting a live, interactive Webcast on Sept. 25 to explore how well prepared auditors and management are for the first round of audits...

Delays Did Nothing to Help Small Cos. Cope With SOX

Tammy Whitehouse September 11, 2008

Numerous delays extended to smaller companies in the requirement to report on the effectiveness of internal control did nothing to improve their chances for success.That’s the conclusion of a recent Lord & Benoit report examining the first go-round of internal control reports for more than 3,300 smaller, non-accelerated filers. The...

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