The current debate about the Sarbanes-Oxley Act may prove to be an object lesson in how short memories in Washington can be. I hope that isn't the case, and that the tone and content of the discourse is focused where it needs to be - on protecting investors and the markets.The Securities and Exchange Commission and the Public Company Accounting Oversight Board are exploring ways to make the law more efficient and cost-effective. In early April, they approved a framework that will build more leeway into the way that parts of the law are implemented. While there are no final decisions, investors need to take heed: Some of the proposals, in implementation, could have the unintended effect of watering down the protections created by SOX.
The Center for Audit Quality, formed by the public company auditing profession to help foster confidence in the audit process, supports making the company assessment and related auditor attestation about internal controls over financial reporting both cost-effective and efficient, and we have been active supporters of necessary reforms. But change cannot come at the expense of the investor protections that have made the law successful in the first place.
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