Compliance Newsflashes

PricewaterhouseCoopers Releases New SOX-related Survey

In a survey released Tuesday of 10,000 directors and CEOs of 2,000 publicly traded companies, PricewaterhouseCoopers found that Sarbanes-Oxley (SOX) remains a force to be reckoned with in the boardroom. Corporate governance reform is a burden for many companies, and one out of five directors surveyed say Sarbanes-Oxley has created an environment where management is distracted enough that company performance will be affected. (This number is up from 13.9 percent in 2003.)

With Section 404 looming, 82 percent of directors believe their company is prepared to implement Section 404 on internal control reporting. However, only 50 percent of directors surveyed think Section 404 internal control reporting requirements will make a di fference in the quality of their company's financial statements; and less than half (44 percent) think Section 302 certification of financial statements by the CEO and CFO will make a difference.

Despite the movement by institutional investors and shareholders to withhold votes against boards for various reasons, only 21 percent of directors surveyed support the recommendation to withhold votes when the audit committee has approved auditors to perform non-audit services. Of the boards represented in the survey, 51 percent have allowed auditors to perform non-audit services for their company. More than three-fourths (77 percent) of directors surveyed think the Sarbanes-Oxley Act should be revisited by Congress to correct some of the unintended consequences.

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