from Corporate Board Member
Board members and corporate executives have devoted vast amounts of time, effort, and money to revamping governance and financial-reporting structures to comply with the Sarbanes-Oxley Act of 2002. As we move into the new law’s fifth year, two big questions are being asked with growing passion. First, was it worth it? And second, what can we do to make it work better?
The good news, from the standpoint of many, is that securities and accounting regulators are finally addressing Section 404, which covers internal controls. New guidance from the regulators, designed to ease some of the section’s most onerous provisions, is expected to be in place before 2007 audits begin in the spring. Securities and Exchange Commission chairman Christopher Cox and Mark Olson, chairman of the Public Company Accounting Oversight Board (PCAOB), which regulates the auditors, met in mid-November to discuss the changes and were expected to unveil a draft proposal in December, which would then be subject to public comment.