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The AAO Weblog covers accounting issues and current events as they relate the practice of investment analysis. All posts prior to September, 2007 are in the public domain, but after September 4, only subscribers to The Analyst's Accounting Observer will see all posts going forward. Only selected, occasional posts will be released to the public domain from September 4 forward.

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SEC: Small Business' Growing Voice
Location: BlogsAAO Weblog (Public)    
Posted by: Jack Ciesielski 3/7/2005 12:53 PM
The SEC announced today the addition of 19 members to its "SEC Advisory Committee on Smaller Public Companies." According to Chairman William Donaldson, "the role of the advisory committee is to advise the SEC on how best to assure that the costs of regulation for smaller companies under the Act and other securities laws are commensurate with the benefits."

He also said that these appointments "are intended to assure that the Commission receives input on these issues from a broad range of market participants, including individuals from diverse industries, geographical areas, professions and categories of smaller companies and investors."

It's a pretty disparate crew: there are small company investors represented (William Blair, Robotti & Company), investors at large (CFA Centre for Financial Market Integrity, part of CFA Institute), smaller public accounting firms than the Big Four (McGladrey & Pullen, Johnson Lambert & Co.), a few small companies, including the CFO of National Instruments Corp. Interesting sidenote about that fellow: he's the principal author of the AeA document on Section 404 I mentioned about a month ago.

The SEC seems to be handling the issue of Sarbanes-Oxley compliance with tact, aplomb and diplomacy - but there may come a time when it has to treat the small companies with tough love. It's already extended their deadlines twice, and with a vociferous bunch of small companies having a direct pipeline to the SEC, expect more requests for leniency - not necessarily deadline extensions, but also relaxation of the rules. Wouldn't it be great if small companies were as intent on becoming big companies?
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