SEC Formally Proposes One-Year Extension of Auditor Attestation Requirement Mandated by SOX Section 404February 2008 Small Business Securities Newsletter
As seen in the Small Business Securities Newsletter. Published by the Securities Practice Group to provide timely and useful information to CEOs, CFOs, and General Counsel
As reported in our last Newsletter, SEC Commissioner Christopher Cox recently announced his intention to seek a one-year delay for smaller companies to comply with the outside auditor attestation report required by Section 404(b) of Sarbanes-Oxley. As expected, on February 1, 2008, the SEC formally proposed to extend by one year the compliance date for smaller public companies such that smaller public companies will first be required to provide outside auditor attestation reports in their annual reports for fiscal years ending on or after December 15, 2009.
In its proposal, the SEC concluded that smaller public companies should not be required to incur the cost and expense of preparing to comply with the auditor attestation requirement until (i) the Public Company Accounting Oversight Board issues its final guidance on auditing internal controls of smaller public companies, and (ii) the SEC completes its study regarding whether the auditor attestation requirement imposed by Sarbanes- Oxley is being implemented in a manner that will be cost effective for smaller reporting companies. The comment period for the proposal ends on or about March 1, 2008, and we expect that the SEC will adopt the proposal in short order.
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