CONTACTS: John Reid/Chris Gindlesperger
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Friday, June 15, 2007  

 

 

WASHINGTON, D.C. – The United States Chamber of Commerce today announced its support for legislation introduced by Congressman Scott Garrett (R-NJ) that would extend the amount of time that small businesses have to comply with the reporting requirements of Sarbanes Oxley (SOX) Section 404.

 

“Action on Section 404 is essential to keep the lifeblood of the American economy flourishing," said Michael Ryan, executive director and senior vice president of the Chamber’s Center for Capital Markets Competitiveness. “The Chamber looks forward to working with members of Congress from both sides of the aisle to lower the fees that Section 404 is levying on small businesses.”

 

The bill, titled The Small Business SOX Compliance Extension Act, intends to extend the current small business exemption from Section 404 auditing and reporting requirements for an additional year.  Garrett intends to offer this legislation as an amendment to the Financial Services Appropriations Act for FY08, which is expected to be considered by The U.S. House of Representatives in coming weeks.
     
Most complaints about how excessively burdensome SOX is for public companies come from the requirements necessary to comply with Section 404.  Section 404 substantially increases costs for businesses by adding external consulting costs, including legal fees.  Research performed by NASDAQ shows that the burden of compliance is 11 times greater for small companies, discouraging them from going public, especially in American financial markets.

 

The U.S. Chamber of Commerce is the world's largest business federation representing more than 3 million businesses and organizations of every size, sector, and region.

 

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