Resources for Sarbanes-Oxley (SOX)

Cox's SEC Thumbs Its Nose at Sarbanes-Oxley Act: Jonathan Weil

www.bloomberg.com

The Securities and Exchange Commission, in its rush to ease the accounting rules for foreign companies before Chairman Christopher Cox leaves office, just violated the spirit -- and maybe even the letter -- of the Sarbanes-Oxley Act.

By a 4-0 vote last week, the SEC ruled that foreign companies with U.S.-listed securities can start reporting their results under international financial reporting standards, or IFRS, without reconciling them to U.S. generally accepted accounting principles. The policy took effect immediately.

Beyond the question of whether this is good policy, there's the question of whether the SEC has the legal authority to do this. In Congress, two senators have said the SEC's latest move runs afoul of Sarbanes-Oxley.

An even bigger decision looms. The SEC already has begun floating the idea of giving U.S. companies a choice between filing their financial statements under IFRS, as set by the International Accounting Standards Board, or under U.S. GAAP. The commission is holding public meetings on the subject next month.

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