Companies are making major strides in reducing their number of “material weaknesses” in complying with Sarbanes-Oxley. A report from Compliance Week shows that the number of faults reported by 9,700 companies fell from 537 shortly after Sarbanes-Oxley went into effect to just 173, three years later.
Other overall positive findings of the reports were:
- The number of company late in their Sarbox filings dropped from 21% in 2004 to just 6% in 2006.
- For large companies, the number of statement re-filings is decreasing
- Companies in the financial industry have the best grip on Sarbox with fewer re-filings and fewer material weaknesses reported
- On a percentage of revenue basis, smaller companies (less than $1 billion) pay nearly six times as much as larger ones, around .3 percent of their revenue on audit and compliance costs.
So while companies are not fans of the complexity and costs of Sarbox, many have the problem under control and are moving their focus onto other areas.
