Costs of complying with the 2002 Sarbanes-Oxley financial and accounting disclosure law are leveling off, but overall compliance costs are heading north, reports The Wall Street Journal.
THE WSJ, citing findings from Boston-based research and advisory firm AMR Research, found that annual compliance spending for all North American companies is expected to grow 8.5 per cent this year to $29.9 billion from $27.3 billion in 2006.
Sarbanese-Oxley remains the biggest single component of the expenditure, says the report. It's expected to account for 20 per cent of companies' compliance expenditures this year, or a total of about $6 billion. That number will grow to $6.2 billion in 2008.
According to Reuters, the $6 billion spend on Sarbanes-Oxley has stabilised over the last two years following the initial Spike when companies poured millions of dollars in to get their systems in order.
Of course, the initial expectation was for spending to taper off as more companies became compliance-savvy.
The bad news is that SOX spending is now locked in at about 20 per cent of the overall compliance, governance, and risk management spending of $30 billion annually.
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