Who Are The Losers In SEC's SarbOx Rule Change?

from the sorting-it-out dept

Over the years, there have been a lot of complaints about the high cost of Sarbanes-Oxley compliance, although some have argued that these costs have tapered off as companies have gotten used to the requirements. Still, many are relieved about a new SEC decision to ease audit requirements, which should have the effect of reducing compliance costs. Not all companies may be enthusiastic, however. Offering tools and services to aide in compliance has itself become a big business, particularly for a number of software firms. Some are now wondering, then, whether easing the regulations will result in a serious hit to profits at these companies. One analyst believes that the rule change could result in a 7% hit to US IT spending, which comes at a time when there’s already concern about corporate tech spending. Of course, the fact that there may be some losers from the rule change doesn’t mean that the rule change is a bad thing. To the contrary, money spent just to be in compliance with some regulation is pretty much a deadweight loss to the economy. Furthermore, while IT vendors may see a short-term hit on account of the rule change, they should benefit from a less risk-averse climate and customers with more money to spend on productive investments.

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Comments on “Who Are The Losers In SEC's SarbOx Rule Change?”

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Jeff (user link) says:

the losers

“Some are now wondering, then, whether easing the regulations will result in a serious hit to profits at these companies.”

This sort of reasoning will keep the confiscatory tax system going. “How can we reform the system–think of all the accountants and lawyers who would be affected by implementing a simple tax system!”

g says:

Re: the losers

Complicated tax system = loopholes for rich not to pay taxes.

When simple tax system is a sales tax = rich dont pay taxes.

This is a much more complicated problem if it’s intended to not only burden the 97% of us with only 3% of the money. (made up figures, though from the other probably made up figures I’ve read, they’re fairly accurate)

g says:

A good concept for finance, taken to an annoying e

SOX wastes a lot of time and money at the company I work for, and in the IT side produces no good results I can see.

Like ISO 9000 compliance, you tell them what you do, and then they check to see that you do it. If you tell them you let anyone onto any server that doesn’t directly contain the financial content, they don’t care, you pass.

There is no good rule of thumb for IT security or procedures, especially since the best practices are always changing, and if you are working under a new model, the old models no longer apply.

Perhaps in the financial departments SOX is useful, but I would be happy to see it leave the IT/Ops/Engineering departments for good. Less money and time wasted.

TooLongInBusiness says:

The investors are the losers

Read the “last days of Enron”, “Final Accounting” (Arthur Anderson’s demise), “Optical Illusions” (Lucent), and “HOw companies Lie”. Believe me, when these companies are after the investor’s buck, there is no limit to the crap they will pull if they aren’t audited.

You don’t have to put up with Sorbanes-Oxley. You only have to tolerate it if you want to be a corporation. Being a corporation gives you freedom from liablity, and a few really good tax advantages. If the audit was too much of a burden, they’d change their business basis (oh, yeah. Most of these leeches couldn’t really do anything. They make their living running something someone else built into the ground.)

I don’t think it’s taxes. It just that when some poor schmuck looks at a balance sheet and an income statement for these guys it isn’t inscribed in fairy dust on a pile of bull crap.

Steve R. (profile) says:

Unfortunately, I do not have any hands-on experience with Sarbanes-Oxley. However, this discussion fits the normal pattern of corporate whining that ANY regulation is too expensive. While complying with regulations may be “expensive”, corporations don’t seem to have any problem with finding money to provide executives with multi-million dollar pay packages or arranging guaranteed capital gains for their executives by back-dating options. If corporations don’t want onerous regulation, why not be ethical to begin with?

Anonymous Coward says:

Rich people don't buy stuff?

“Complicated tax system = loopholes for rich not to pay taxes.

When simple tax system is a sales tax = rich dont pay taxes.”

not trying to threadjack … but, are you saying rich people don’t buy things? I would say that this is the great equalizer? If they wanted to spend any money they would have to pay. If they bought off shore they would pay tp bring it back … pretty simple. I guess it’s much better now when they can hide their assets in off shore accounts … etc. Once again, you can’t hide that house, or that car you have to register, or that plane, or that snickers bar. not to mention the money businesses would be saving, and the commerce it would attract to the US because companies wouldn’t be moving to these off shore tax shelters.

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