SOX Center

The financial reporting legislation may be changed in order to relax stringent regulations and reduce the cost of compliance

Regulators are preparing to review elements of the Sarbanes-Oxley Act to determine whether or not portions of the financial reporting legislation should be relaxed to ease the burden on companies doing business in the United States.

On May 24, the PCAOB (Public Company Accounting Oversight Board) — the nonprofit oversight group created to help manage application of the Sarbanes Oxley Act — plans to meet in Washington to vote on a range of topics, including several issues that could shift the application of the legislation, originally passed in 2002 to help fight corporate financial fraud.

In the meetings, the group is expected to approve a final standard for auditing internal control over financial reporting as well as a related independence rule and several other measures.

If adopted, the rule will supersede PCAOB’s existing Auditing Standard No. 2, also known as “An Audit of Internal Control over Financial Reporting Performed in Conjunction with an Audit of Financial Statements.”

The PCAOB also plans to vote on two separate recommendations to amend its rules on the frequency and level of scrutiny in required inspections to test compliance with SOX.

Info World: Regulators to begin SOX reviews