Magazine article Risk Management

Sarbanes-Oxley's Approval Rating on the Rise

Magazine article Risk Management

Sarbanes-Oxley's Approval Rating on the Rise

Article excerpt

Everybody hated Sarbanes-Oxley in 2002. There was no question that the scourge of white-collar crime--at Enron, at Worldcom, at Tyco, at some other blue-chip company seemingly every month--necessitated regulatory response. But this was too much. This was too wide ranging. This was too onerous. This was too expensive.

Well, 10 years later, it turns out that the Sarbanes-Oxley Act, which mandated more rigorous accounting standards for all public companies in the United States, helped businesses enhance their financial reporting. Proviti, a consulting and internal audit subsidiary of Robert Half International, recently conducted a survey to gauge how the reform changed auditing procedures in this country.

"Sarbanes-Oxley has had its share of controversy in the past, but nearly 70% of respondents in our survey reported that the internal control over financial reporting structure in their organizations has improved since compliance with Sarbanes-Oxley Section 404 became a requirement," said Brian Christensen, Protiviti's executive vice president of global internal audit.

And almost everyone surveyed expects their reporting process to continue to improve. More than four out of five respondents (83%) said their companies plan to further automate the process. On the one hand, that means more investment into a compliance budget-line item that did not even exist in 2001. On the other, a more-automated process will seemingly make it even more difficult for unscrupulous fraudsters to pilfer company revenue. …

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