{"id":1457,"date":"2008-05-04T10:52:17","date_gmt":"2008-05-04T16:52:17","guid":{"rendered":"http:\/\/www.sequence-inc.com\/fraudfiles\/?p=1457"},"modified":"2008-05-04T10:52:17","modified_gmt":"2008-05-04T16:52:17","slug":"an-average-company-wasted-17-million-on-sox-404-compliance-last-year","status":"publish","type":"post","link":"https:\/\/www.sequenceinc.com\/fraudfiles\/an-average-company-wasted-17-million-on-sox-404-compliance-last-year\/","title":{"rendered":"An average company wasted $1.7 million on SOX 404 Compliance last year"},"content":{"rendered":"<p>Financial Executives International <a href=\"http:\/\/fei.mediaroom.com\/index.php?s=43&amp;item=204\">polled companies<\/a> for the 7th year in a row to determine how much it costs to comply with Section 404 of the Sarbanes-Oxley Act. This year, they talked to 185 companies with average annual revenues of $4.7 billion.<\/p>\n<p>The total average cost of compliance was $1.7 million in 2007. This is a decrease from the prior years.<\/p>\n<p>The survey also asked &#8220;accelerated filers&#8221; (companies with market capitalization above $75 million) about their audit fees for 2007. The total audit fees for these companies averaged $3.6 million, up a bit from 2006.<!--more--><\/p>\n<p>Here are some other interesting figures:<\/p>\n<ul>\n<li>Companies averaged 11,100 internal people hours to comply with Section 404 in 2007. (What a waste!) Yet this was considered good because it was a 8.6% decrease from 2006.<\/li>\n<li>Companies averaged 1,244 external people hours to  to comply with Section 404 in 2007. (More waste!) This was also considered good because it was a 13.7% decrease from 2006.<\/li>\n<\/ul>\n<p>And companies apparently think that Section 404 is doing some good:<\/p>\n<ul>\n<li>50.3% agreed that financial reports are more accurate; up from 46% in 2006.<\/li>\n<li>56.0% agreed that financial reports are more reliable, up from 48% in 2006.<\/li>\n<li>43.6% agreed that compliance with Section 404 has helped prevent or detect fraud; up from 34% in 2006.<\/li>\n<li>69.1% agreed that compliance with Section 404 has resulted in more investor confidence in their financial reports, up from 60% in 2006.<\/li>\n<\/ul>\n<p>Although you&#8217;ll see in my book, <a href=\"http:\/\/fraudessentials.com\">Essentials of Corporate Fraud<\/a>, there is generally a disconnect between what the executives think about fraud and the reality of fraud. Executives think that what they&#8217;ve implemented is  more effective than it is in reality. <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/tracy\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/coenen\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/tracy+coenen\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/tracy+l+coenen\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/cpa+mba+cfe\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/tracy+l+coenen+cpa+mba+cfe\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/tracy+coenen+cpa+mba+cfe\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/tracy+coenen+cpa\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/tracy+coenen+cfe\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/fraud+investigation\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/fraud+investigator\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/sequence\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/sequence+inc\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/fraud+examiner\"><\/a> <a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/fraud\"> <\/a><a rel=\"tag\" href=\"http:\/\/technorati.com\/tag\/essentials+of+corporate+fraud\"> <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Financial Executives International polled companies for the 7th year in a row to determine how much it costs to comply with Section 404 of the Sarbanes-Oxley Act. This year, they talked to 185 companies with average annual revenues of $4.7 [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[5],"tags":[797,798,13,799,800],"class_list":["post-1457","post","type-post","status-publish","format-standard","hentry","category-fraud-news-stories","tag-fraud-detection","tag-fraud-prevention","tag-sarbanes-oxley","tag-sarbox","tag-sox"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p6Z0e-nv","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/posts\/1457","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/comments?post=1457"}],"version-history":[{"count":0,"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/posts\/1457\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/media?parent=1457"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/categories?post=1457"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/tags?post=1457"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}