Biotechs Pleased with SEC Proposals
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The Biotechnoloy industry lobby group, the Biotechnology Industry Organization (BIO) praised the SEC. The source of good news was a package of proposals giving small companies an effective exemption from having to comply with the infamous Section 404. The proposal demonstrates that the SEC is considering the full weight of Section 404 on smaller public companies, said Greenwood. "Section 404 is creating costly, unintended burdens on smaller firms that frequently operate with limited or no revenues." Smaller companies or accelerated filers are those which have a market capitalization between $75m and $700m. They would not have to comply with Section 404 until Dec. 15 2008. This means they would not have to file an attestation report. Newly listed companies will also be able to delay the report. "Four years after enactment of the Sarbanes-Oxley Act, it is necessary to correct sections that are having unforeseen and detrimental effects on smaller public companies. BIO will continue to work with other affected industries and the SEC to ensure that emerging companies remain competitive and are not forced to divert valuable research and development dollars to administrative tasks, Greenwood said. BIO also intends commenting on the SEC's Concept Release on guidance. The report was designed to assist companies assessing internal controls over financial reporting. Essentially what they need to do for Section 404 compliance. BIO says it will recommend a risk-based approach applying internal controls assessment.
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Selected Books Keywords Section 404 and small companies internal controls and small companies
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