Sarbanes Oxley Drives Up Large Companies' Audit Costs by $1.4 Billion

Fortune 1000 companies' auditing costs have increased by $1.4 billion collectively so far, and much of this increase is in response to the corporate governance act known as Sarbanes-Oxley, according to University of Nebraska at Omaha researchers.

The insurance industry has seen its audit fees escalate this year by more than 70 percent, while retailers have faced a 180 percent jump, the researchers found.

With the latest figures reported, as of April 27, a total of 633 Fortune 1000 firms have reportedly paid more than $3.6 billion for their 2004 audits, compared to $2.2 billion in 2003, according to accounting professors Susan Eldridge and Burch Kealey, who helped develop an automatic text-mining and data extraction technique that makes hundreds of hours of data-collection manageable.

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