July 2010

To 404(b), or Not to 404(b)?

From CFO.com.

Small companies will soon learn whether they will have to comply with Sarbox's requirement to get an auditor's sign-off on internal controls.

Dan Crow is one of the few small-company CFOs with an auditor's stamp on his internal controls. Getting it wasn't as time-consuming or as costly as it would have been several years ago, when large public companies first began complying with one of the most onerous requirements of the 2002 Sarbanes-Oxley Act, known as Section 404.

Still, Crow, who oversees finance for retailer Hastings Entertainment, doesn't rule out dropping the extra review next year if Congress decides to permanently exempt small public companies from needing an auditor's sign-off on their internal controls — as it seems poised to do. The Senate is expected to vote this week on the final version of the financial regulatory-reform bill, which would exempt companies with market caps less than $75 million from complying with Section 404(b), the rule in question. (The House has already passed the bill.)

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