International Exemptions Sought For Sarbanes-Oxley
A delegation from Japan is scheduled to visit the United States this week in an effort to convince the SEC and other enforcement agencies to exempt its accounting firms from certain provisions of the Sarbanes-Oxley Act.
In a letter sent to the AICPA immediately after the Act was signed in July, the Japanese Institute of CPAs expressed concern that "the implementation of the Sarbanes-Oxley Act would place U.S. laws above the Japanese Securities and Exchange Law and CPA Law and clearly violate international treaties and infringe upon Japanese sovereignty."
The Sarbanes-Oxley Act encompasses foreign firms as well as domestic firms within its reach:
|Sarbanes-Oxley Act, §106(a)(1): IN GENERAL. - Any foreign public accounting firm that prepares or furnishes an audit report with respect to any issuer, shall be subject to this Act and the rules of the Board and the Commission issued under this Act, in the same manner and to the same extent as a public accounting firm that is organized and operates under the laws of the United States.|
But a provision is also included in the Act which states that the SEC has the authority to exempt any individual firm or class of firms from this provision if it determines that the exemption is in the public interest.
The representatives of the Japanese Institute of CPAs, the Japan Corporate Auditors Association, and Financial Services Agency will discuss Japanese auditing regulations with US officials and hope to prevent Japanese firms from double regulation in performing their auditing responsibilities.
Voice of the Editor
Which isn’t completely true. I mean, occasionally I drop by when I manage to sneak out of the nonstop frat party over at Going Concern, but I’m mostly a wallflower over there. I’m happy to say that I’ve been given express permission (or explicit orders, if you like) to wander over here to AccountingWEB more often.
Why is that, you might ask? My job is to replace the irreplaceable Gail Perry as Editor-in-Chief. What does that mean? I don’t really know! I think it’ll be fun getting a feel for things, throwing in my own thoughts here and there, and listening to the discussions you’re having about the accounting profession.