A surge in restatements by smaller public companies could reignite the debate over whether they should be subject to an audit of internal controls, per Section 404(b) of the Sarbanes-Oxley Act.
The number of accounting restatements by non-accelerated filers (companies with a market capitalization below $75 million) rose 13.8 percent, from 484 restatements in 2009 to 551 in 2010. The numbers also split sharply between U.S. non-accelerated filers, who had only a 10 percent increase, and foreign non-accelerated filers, whose restatements jumped 29 percent.
