Tax Guru – Ker$tetter Letter

From Ohio CPA Dana Stahl a few weeks ago:

Subject: NYSlimes article on SOX

 

Mr Guru – thought you’d like this article in the Slimes on SOX.  I haven’t really followed SOX, since it doesn’t really impact my firm.  Regardless, this article lauds SOX, as you’ll read.  However, when I see the media praising something, I’m already suspicious.  What do you think of SOX and of this article.  In your prospective, is the author getting it right?  Has SOX been beneficial or a bust?  Perhaps you can address this in the blog.

DS, CPA, ABA, ATA, ATP

Dana:

For the same reasons as you have, I haven’t been following the details on SOX as closely as I would have been a few decades back, when I was an internal auditor for a publicly traded corporation, where I helped prepare the 10Q and 10K reports.

However, the cursory mentions I have seen over the past several months gave me the impression that it was the same as other attempts by our rulers to legislate ethical behavior; a lot of window dressing with no real tangible effects other than to increase the paperwork.  Plenty of loopholes still allow enough opportunity for creative book cooking to continue.

I share your skepticism of trusting anything the DemonRats’ official news organ says.  If the NY Slimes claims something is good, the best interpretation is that it is counter to basic principles of capitalism.

I saw another good look at this by Joe Kristan, Jack Ciesielski and Dan Meyer on their blogs:

http://tickmarks.blogspot.com/2005/12/sec-head-cox-accounting-rule.html

http://www.rothcpa.com/archives/001506.php

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=794831

http://www.accountingobserver.com/blog/2005/12/the-complexity-conundrum/

 

They seem to share our doubts that SOX has accomplished anything more than adding additional complexity to the accounting game.

Kerry

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