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AMR Research: SEC Gives Smaller Firms a Little SOX Breathing Room

AMR Research: SEC Gives Smaller Firms a Little SOX Breathing Room

by Rick Turoczy on December 3, 2004

On November 30, 2004, the U.S. Securities and Exchange Commission (SEC) issued an executive order that gives some additional breathing room to smaller firms that must comply with internal controls provisions stipulated in the Sarbanes-Oxley Act of 2002 (SOX). But the extension is limited—only 45 days—and applies to accelerated filers with market capitalization between $75M and $700M whose fiscal years close between November 15, 2004 and February 28, 2005.

The Bottom Line: Companies that qualify for this SOX extension have an additional 45 days to include management’s report on internal control over financial reporting and the related auditor’s report on management’s assessment of internal control over financial reporting.

What It Means: An analysis of public company information indicates that there are over 2,600 companies with market caps between $75M and $700M. A subset of these companies has closing dates between November 15, 2004 and February 28, 2005.

The Takeaway: We expect this ruling to affect over 1,500 companies.

AMR Research: SEC Gives Smaller Firms a Little SOX Breathing Room

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