Cox says no to SOX exemptions. Audit fees up or down? Go figure!

First came the Securities and Exchange Commission's Advisory Committee on Smaller Public Companies' recommendations to exempt small caps from the internal controls provisions of Sarbanes-Oxley.

Now SEC chairman Christopher Cox has come out telling smaller companies not to hold their breath. He says there will be no exemptions.

Adding to the mixed signals are the latest figures showing audit fees have fallen. Well, for some.

In aggregate, companies reported a 0.6 per cent drop in audit and audit-related fees and they claimed total fees were 7.4 per cent down.

Before the pro-Sarbanes Oxley people seize on that, it's important to remember there is still some way to go. And the numbers aren't even. The study for instance found that audit fees were down for 25 big companies but 22 recorded increases, including Agilent Technnologies which reported a 70 per cent hike in payments. ouch!!

Still, that's in contrast with a report in the Wall Street Journal last month suggesting that while the boom is winding back, audit fees still rose by 2.8 per cent in 2005 to about $541 million. Big difference from the 40 per cent hike the year before. So it's a smaller increase but still it's still an increase.

The numbers are all over the place. So still a bit too early to tell how all this will pan out.


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