Financial Executives International Announces the Results of its Seventh Sarbanes-Oxley Compliance Survey

Published: 30 April 2008

(Article URL: http://www.b-eye-network.co.uk/view/)

Sarbanes-Oxley compliance survey, which found that Section 404 compliance cost Corporate America less in year four of adoption than in each of the first three years.

Financial Executives International (FEI) recently announced the results of its seventh Sarbanes-Oxley compliance survey, which found that Section 404 compliance cost Corporate America less in year four of adoption than in each of the first three years. FEI polled 185 companies to gauge experiences in complying with Section 404. The responding companies had average annual revenues of $4.7 billion.

According to the FEI survey, which included 168 "accelerated filers" – companies with market capitalizations above $75 million – total average cost for Section 404 compliance was $1.7 million during fiscal year 2007. While a direct comparison cannot be made from 2006 costs, as the respondent pool varies year to year, the results show a continued decline in compliance costs. The survey also revealed that total audit fees for U.S. accelerated filers averaged $3.6 million, representing a slight (1.8%) increase from the previous year.

"As companies continue to find efficiencies in complying with Section 404 and make compliance part of a routine practice, we have seen a continued decline in costs," said FEI President and CEO Michael P. Cangemi. "While 404 auditor costs also declined 5.4% as the auditor scope of work narrowed, these costs were offset by a reported five percent increase in the average hourly audit rate charged by auditors."

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