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SEC May Delay Reviews (washingtonpost.com)

SEC May Delay Reviews (washingtonpost.com)

by Rick Turoczy on December 7, 2004

A Securities and Exchange Commission official yesterday signaled that the agency may grant foreign companies whose stock trades on U.S. exchanges a brief delay to comply with a controversial accounting reform.

SEC Chief Accountant Donald T. Nicolaisen said he is “sensitive” to the burdens that foreign companies already face as they try to meet deadlines starting in July to review and attest to the strength of their financial safeguards.

Experts say reviewing internal controls, such as restrictions on employees’ computer access to important financial data, will help cut down on fraud and financial mistakes that hurt investors. The reform is one of the most costly and time-consuming to be imposed under the 2002 Sarbanes-Oxley Act. The SEC last week gave companies with market value between $75 million and $700 million an extra 45 days to meet their accelerated deadlines, which began Nov. 15.

“We have and continue to be sensitive to the need to accommodate unique foreign structures and requirements,” Nicolaisen told an audience attending the American Institute of Certified Public Accountants’ national conference in the District. “Clearly many non-U.S. issuers and their auditors are working hard and are well on their way to completing the work necessary to report on internal controls. However, I am sensitive that this requires, in some cases, great cultural change.”

SEC May Delay Reviews (washingtonpost.com)

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