Two-thirds of investors would be concerned about any easing of Sarbanes-Oxley rules, according to a national survey by the Center for Audit Quality, released in conjunction with the five-year anniversary of the legislation.
The organization, affiliated with the American Institute of CPAs, took a poll of 1,000 investors around the country to find out how they felt about recent efforts to relax some of the requirements of the Sarbanes-Oxley Act, which was passed in the wake of accounting scandals at Enron, WorldCom and other high-profile companies.
Sixty-two percent of investors polled by the CAQ believe the rules mandated by Sarbanes-Oxley should be left in place. Seventy-nine percent said the changes brought about by SOX bolstered their confidence in the financial information provided by public companies. The same proportion agreed that the SOX requirement to establish independent audit committees has been effective.
Seventy-six percent saw a positive impact from external auditors reporting to independent board-based audit committees. The same proportion said involvement by the Public Company Accounting Oversight Board has been effective. Again, 76 percent believe the requirement for companies to evaluate and disclose their internal controls and for external auditors to attest to such disclosures has been positive. And 74 percent said certification of financial reports by CEOs and CFOs has had a positive effect.
Peter Iannone, a director with CBiz Accounting, Tax & Advisory Services, agrees with the majority of investors in the CAQ survey. “Ultimately I believe the rules do need to be in place,” he said. “If nothing else, past history does show there are needs to assess and review internal controls.”
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