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SEC Schedules Open Meeting to Discuss 404 Changes April 2, 2007 (SmartPros) The Securities and Exchange Commission announced it will hold an open meeting on April 4 to discuss the Public Company Accounting Oversight Board's proposed auditing standard for Section 404 of the Sarbanes-Oxley Act and the coordination of that proposed standard with the SEC's related pending proposal to provide guidance for management of public companies implementing Section 404. Both proposals were published for public comment in December 2006, and the comment periods for both proposals ended on Feb. 26, 2007. The open meeting represents a continuation of the process announced in May 2006 by the Commission and the PCAOB to improve the reliability of financial statements public companies file with the SEC while making compliance with Section 404 more efficient and cost effective. As part of this process, the SEC has proposed management guidance for Section 404 compliance designed to focus attention on those internal controls that present the greatest risk for a material financial misstatement. At the same time, as a companion to the proposed SEC guidance, the PCAOB has proposed a thoroughgoing revision of its existing standard for Section 404 audits. "Effective and efficient Sarbanes-Oxley Section 404 implementation is vitally important for investors in public companies," said SEC Chairman Christopher Cox. "For this reason, the SEC and the PCAOB have been working together to improve Section 404 procedures to establish a risk-based, top-down approach that is scalable for companies of all sizes. This meeting will help to keep us on track to consider final adoption of our management guidance in May 2007." 2007 SmartPros Ltd. All rights reserved. |
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