VitalAccurateThinking

Duh! Sarbanes-Oxley bleeds profits

"Apologists for the Sarbanes-Oxley Act claim that its corporate governance reforms benefit the American economy in a number of ways, including restored investor confidence in the integrity of the capital markets, enhanced corporate disclosures and reduced incentives for corporate management to manipulate stock prices. Unfortunately, these benefits are both intangible and resistant to measurement.

While we thus don’t know whether SOX in fact benefits the economy, we do know that it has imposed a much higher regulatory burden on U.S. public corporations than the law’s sponsors ever imagined. According to The Wall Street Journal, for example, publicly traded U.S. corporations routinely report that their audit costs have gone up as much as 30 percent, or even more, due to the tougher audit and accounting standards imposed by SOX."

posted by Jim VAT @ 5:46 PM