The deadline for small companies to fully comply with Sarbanes-Oxley accounting legislation could be extended past 2008 if the costs still exceed the benefits of the law, the top accountant at the U.S. Securities and Exchange Commission said on Monday.

The SEC is currently requiring companies with a public market capitalization of less then $75 million to conduct a management assessment of their internal controls. But those companies will not have to have to get an internal controls audit by external auditors until 2008.

“For micro-cap companies … they will not have to have an internal control audit until 2008, and if we don’t see the cost-benefits are in line by then we’ll have to defer it even more,” Conrad Hewitt, chief accountant at the SEC, said at a New York State Society of CPAs conference in New York.

[1] Reuter: UPDATE 1-SEC may extend SOX deadline for small US companies