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Tuesday, April 12, 2005
SEC set to hear complaints on U.S. reporting rules
WASHINGTON, April 12 (Reuters) - Companies trying to meet a new rules for tighter internal financial controls are expected to give regulators and major audit firms an earful at a forum on Wednesday hosted by the Securities and Exchange Commission.
The rule, from Section 404 of the 2002 Sarbanes-Oxley Act crackdown on accounting fraud, requires managers to explain in annual reports how they keep their finances in order and for outside auditors to approve their methods.
Hundreds of companies have already complained about the cost and time involved in meeting 404 and more complaints and possible solutions are expected to be aired on Wednesday.
The forum will "let people vent and to see if there are areas of implementation that need to be changed," SEC Commissioner Roel Campos said at a public event on Monday.
Companies are complaining that audit fees are "going through the roof," while auditors are using less professional judgment in performing their jobs.
"Do auditors really need to look under every rock?" Campos asked.
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