SEC extends SOX deadline for foreign companies.On March 2, the Securities and Exchange Commission (SEC) extended the deadline for mid-sized U.S. public companies with revenue of $75 million or less and foreign public companies to comply with Section 404 of the Sarbanes-Oxley Act See SOX. (SOX), which requires companies to report annually on the adequacy and effectiveness of their internal financial controls. The new deadline, July 15, 2006, is a one-year extension from the previously established deadline. Generally speaking, the extension applies to those businesses incorporated or organized outside the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. with more than half of their ownership, management, assets, and/ or administration outside the United States. Many European companies It may never be fully completed or, depending on its its nature, it may be that it can never be completed. However, new and revised entries in the list are always welcome. This is a list of companies from the countries in the European Union. face burdens "above and beyond" those of U.S. companies as the European Union European Union (EU), name given since the ratification (Nov., 1993) of the Treaty of European Union, or Maastricht Treaty, to the European Community moves to adopt international financial reporting standards International Financial Reporting Standards (IFRS) are standards and interpretations adopted by the International Accounting Standards Board (IASB). Many of the standards forming part of IFRS are known by the older name of International Accounting Standards (IAS). for the first time, SEC Chairman William Donaldson said. According to Donaldson, the changes will make it easier for new users of the European Union accounting rules--the International Financial Reporting Standards (IFRS IFRS International Financial Reporting Standard(s) IFRS Inter Frame Relay Service IFRS Indiana Facilities Registry System )--to list on U.S. exchanges. The SEC has long permitted companies to use IFRS provided that the figures representing their companies' operations were reconciled with the United States' Generally Approved Accounting Practices (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ) over a three-year period. Under the new rule, first-time users of IFRS would need to reconcile their financial statements for only two years, Donaldson said. In November 2004, the SEC gave small U.S. companies additional time to verify their internal controls after finding they were overwhelmed trying to meet the mid-2005 deadline for domestic firms. Despite the extension to comply with Section 404, many consultants say the chief executive officers and chief financial officers of certain mid-size and foreign public companies must still execute and file certifications about their internal controls under Section 302 of SOX. |
|
||||||||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion