The gutting of Sarbanes-Oxley

Filed in archive SOX on July 13, 2010

Will any business in the United States have to comply with Sarbanes-Oxley, the law introduced in response to the Enron scandal, the piece of legislation that was supposed to clean up US business?

CFO.com reports that Congress is set to grant a permanent exemption for small companies with market caps of less than $75 million from requiring an auditor's sign-off on their internal controls. And big companies are set to get exemptions too.

As Caleb Newquist writes at Going Concern , Congress has completely ignored the benefits of Sarbanes-Oxley which have forced American business to clean up its act and become more efficient. Worse still, those smaller companies to be exempted will be at more risk of fraud and accounting skullduggery.

Assuming this will go through, it's only a matter of time before we see another Enron, something Sarbanes-Oxley was supposed to prevent. If nothing else, it shows where the real power in America lies. And it's not with the people.