Retiring U.S. Rep. Michael Oxley, an author of the Sarbanes-Oxley Act, said the Securities and Exchange Commission has the legal authority to roll back the 404 provisions for smaller public companies, Reuters reports.
In a March 3 letter to SEC Chairman Christopher Cox, Oxley and Richard Baker, chairman of a financial services subcommittee, support "the view that the Commission currently possesses the authority to provide relief from the provisions of the Sarbanes-Oxley Act" under both the Securities and Exchange Act of 1934 and the 2002 Sarbanes-Oxley law.
Section 404 of the act requires companies to explain their internal controls and have them audited and attested to by an outside auditor. It has been the most contentious portion of the law, attacked by smaller U.S. public companies as too costly and anti-competitive.
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