The Securities and Exchange Commission (SEC) has created an advisory committee to look at the impact of federal securities laws including Sarbanes-Oxley (SOX) on small businesses. The 21 members of the Committee on Smaller Public Companies is charged with examining the impact of SOX in three key areas:
- Internal Controls. What financial reporting frameworks are available to smaller companies? How does management assess internal controls and what audit standards exist?
- Corporate Disclosure, Reporting Requirements, and Governance Requirements. How do market capitalization, size and characteristics, accounting standards and financial reporting requirements, differ for smaller firms?
- Securities offerings. What are the processes, requirements and exemptions related to public and private offerings of smaller firms.
“Sarbanes-Oxley Act has already benefited America’s investors enormously and will spur further improvements in our securities markets,” SEC Chairman William H. Donaldson stated upon appointing members to the new committee.