The End of Sarbanes-Oxley?

CIRCLEVILLE, OH - OCTOBER 13:  Republican pres...

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While GOP presidential candidates have traded sharp barbs over health care, immigration and taxes, one issue seems to unite the major contenders: getting rid of Sarbanes-Oxley, particularly Section 404, which requires substantial outside audits for public companies.

Herman Cain, now the leader in several polls, has proposed repealing Sarbanes-Oxley to spur growth and job creation. In point 10 of his 59-point economic plan, front-runner Mitt Romney calls for amending Sarbox to “relieve mid-size companies from onerous requirements.” And Rick Perry proposed rescinding Section 404 of Sarbanes-0xley as part of his just-released flat tax plan.

In 2010, Congress exempted firms with market caps below $75 million from Section 404 in an effort to reduce the regulatory burden on small businesses. The 2012 election may well decide whether that exemption is increased or otherwise amended.

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