After delaying Section 404 compliance for small companies at least four times since Sarbanes Oxley became law in 2002, the SEC has set a compliance deadline of June 15, 2010 for companies with market caps of less than $75 million. Section 404 requires that companies publicly report on the effectiveness of their internal control over financial reporting.
In a recent public statement, Mary Schapiro, the SEC’s new chairman, commented that, “Since there will be no further commission extensions, it is important for all public companies and their auditors to act with deliberate speed to move toward full Section 404 compliance.”
Section 404 compliance is both time consuming and expensive, so if you haven’t begun planning with your auditor, there’s no time like the present.
— Laurie Berman, email@example.com