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COSO to Help Small Businesses with Internal Controls

COSO to Help Small Businesses with Internal Controls

by Rick Turoczy on January 12, 2005

Small businesses are about to get help complying with the stringent new internal control requirements of the Sarbanes-Oxley Act. The Committee of Sponsoring Organizations (COSO) announced Monday that it will develop guidance that will help small firms follow the new rules without breaking their budgets, according to Dow Jones Newswires.

The new guidance, which will be produced by PricewaterhouseCoopers LLC, will be available online by June 30. COSO Chairman Larry Rittenberg estimated that 5,000 public companies with annual sales of less than $200 million can be helped from the new tips.

Even large companies, with far more resources and employees, have felt overburdened by the regulations outlined in Sarbanes-Oxley, the corporate reform legislation approved by Congress in 2002 in response to a series of massive accounting scandals.

Rittenberg said smaller companies must comply with the rules this year, and COSO hopes to address the question of how small firms can tighten internal controls without hiring more people. One way to prevent fraud is to ensure that financial responsibilities are delegated among different employees so no one person has too much control.

COSO to Help Small Businesses with Internal Controls

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