Experts differ on the weight and significance of the most recent round of Sarbanes-Oxley guidance offered last week by the Securities and Exchange Commission and the Public Company Accounting Oversight Board.
On one hand, the 52 combined pages of guidance significantly loosen the noose on the exercise of professional judgment and communication between registrants and auditors. At the same time, the documents clearly encourage the establishment of a top-down, risk-based approach to testing and reporting on internal controls. Auditors say it will improve the process and reduce the cost in the next reporting cycle.
