|  | | 2005 News and Press Releases | | |
HEADLINE NEWS:
Majority Of Small Businesses Want Separate SOX Standards
Staff Writer
AccountingWeb.com. November 16, 2005
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EXCERPT: More than two-thirds of small businesses favor differing standards of Sarbanes-Oxley Act (SOX) regulation for small and large firms according to a recent study commissioned by SAP America, Inc. The study also revealed that SOX regulation has made it more difficult for nearly half of all small businesses to successfully conduct business. Ten percent of companies surveyed intend to ignore SOX regulation in anticipation of an eventual appeal for small and mid-sized enterprises. “According to the SAP survey, the majority of small businesses now acknowledge the need for improved reporting and greater investments in time and money to effectively meet Sarbanes-Oxley guidelines,” Michael Sotnick, senior vice president, Small and Midsize Enterprises, SAP America, Inc. said in a prepared statement. Coming on the heels of the announcement by the Security and Exchange Commission (SEC) of a one year delay in compliance requirements for small businesses the study discovered many valuable points regarding how small companies have approached SOX compliance, including: Most businesses are investing and adjusting resources. The study indicates that 54 percent of companies have altered their focus in response to the delay, investing more time and money in planning. In addition, 53 percent of non-compliant companies are now working with outside consultants to guide measures and lay out a methodical approach to Sox compliance. Cost of compliance is cited as greatest challenge For the majority (54 percent) of small public businesses, the significant cost of compliance was the greatest challenge to SOX regulation. The second greatest challenge, cited by 16 percent of survey respondents, is balancing compliance costs and budget forecasts. Outsourcing used in funding compliance. Further evidence of the cost challenges of SOX is found in how companies are funding compliance plans: 42 percent have outsourced SOX compliance, 18 percent have cut marketing and/or research and development budgets and 16 percent have reduced headcount to scale back costs. |
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