While the impact of the Sarbanes-Oxley Act on small publicly-traded companies is well documented, the SEC's work toward any reform in the application of this legislation is proceeding at a snail's pace. The Sarbanes-Oxley Act dramatically increases reporting and disclosure requirements for public companies in the wake of Enron, et al.
After months of warnings about the chill that Sarbanes-Oxley is having on small public companies, the SEC just this last week announced the members of an advisory committee to investigate the problem. There has been a wave of small public companies going private or selling to large companies due to the impact of Sarbanes-Oxley. Meeting this law's requirements add hundreds of thousands of dollars in accounting fees each year for even the smallest publicly traded company.
But according to the Washington Post, the two lawmakers whose names are forever linked to this legislation see need for any changes whatsoever.
"'We need, I think, now to continue moving forward, locking these concepts in place, getting the gatekeepers to keep doing their job,' Sarbanes said.
"Oxley quickly agreed, telling the audience there is no need for lawmakers to 'meddle' at this point."
And lined up right behind them are those who have seen a huge windfall from the requirements imposed by Sarbanes-Oxley: the accounting industry. Their lobbyists must be quite busy these days protecting their interests, what with the threat of less revenue from Sarbanes-Oxley and tax reform on the agenda in Washington. But, no worry. I am sure that "big accounting" will come out of both smelling like a rose....
