Let's see now, the big accounting scandals like Enron were due to accountants. So what did the government think the best way would be to make them pay for this - create a new law requiring the oversight of a business function that was in no way responsible for the accounting scandals and...wait for it...wait...pay accountants to do the oversight. This in effect financially rewards their profession for causing harm to thousands of people. Not only that, it makes the companies who have to pay for this compliance (on average 5 million dollars for a fair-sized company) less competitive in global markets because they're incurring a cost that their competitors in other countries don't have to pay.
Repeal section 404 of the Sarbanes-Oxley Act
Tags: sox sarbanes-oxley global economy
Comments (1)
SOX is a joke the way it is currently applied. It requires many functions that were paperless (eco-friendly!) to now have a paper trail.
The driving force behind this was Enron. Although the crimes at Enron were perpetrated at the highest levels, not at the level of middle management where SOX takes the biggest hit in time and productivity.
SOX also forced hundreds of small businesses out of the public financing arena. Small businesses were forced to purchase back their shares of common stock from the public because the "cost of compliance" with SOX is astronomical.
Tons of unintended consequences from another Washington brain fart. This was nothing more than the Accountants Full Employment Act.
All you had to do was make it illegal for an CPA firm that auditied the books of a corporation to have any interest, direct or through secondary parties or subsidiaries, in fees generated by consulting. CPA firms can do one or the other, but not both.