The question now is whether the unwinding of Sarbanes-Oxley is on the agenda with the SEC Subcommittee on Internal Controls recommending to exempt the smallest public companies from the much-hated Section 404 of the Act.

It's been a long time coming. Ever since Congress overwhelmingly passed Sarbanes-Oxley in 2002 to curb the abuses that cost shareholders billions of dollars, the corporate backlash has been gathering momentum. In particular, the fiercest attacks have been on Section 404 which requires companies to document in detail their procedures for assuring the accuracy of their financial statements and disclose any weaknesses in those procedures.

Companies have blamed Section 404 for adding billions in audit and legal costs. In April, the US Chamber of Commerce told the Securities and Exchange Commission that Section 404 was jeopardising capital markets and competitiveness. Not so, said the Council of Institutional Investors. In its letter to the SEC, the council said 404 was a core piece of the Act, that costs of compliance were going down, that the mechanism was flexible enough to accommodate differences between large and small companies and in any case, shareholders weren't complaining. But in August, a University of Georgia study found that SOX imposed a disporportionately higher cost on smaller companies. You have to wonder whether shareholders have got anything out of all these extra costs.

It's worth noting that a study commissioned by the Big Four and released last week found that costs of Section 404 were expected to decline significantly, by 43 percent for large companies in the second year, and 39 percent for smaller companies.

I doubt if that would cut much ice with business. After all, there is no doubt that SEC miscalculated when it initially estimated that Section 404 would just require an extra five hours of work for each quarterly report.