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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, 2007, 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.

Paulson Slaps SarbOx
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Posted by: Jack Ciesielski 8/2/2006 10:32 AM
Delivering his first speech as Treasury Secretary at the Columbia Business School yesterday, Hank Paulson took a thinly veiled slap at the Sarbanes-Oxley Act:

"There have been plenty of challenges over the last five years, not the least of which were the corporate scandals involving such companies as Enron and WorldCom. Corrective measures to address corporate scandals and increase investor confidence also played a role in the recovery. I take pride in the fact that when there is a problem in the United States – like no other nation in the world – we shine a light on it and move quickly to clean it up.

Often the pendulum swings too far and we need to go through a period of readjustment. But there is no doubt that certain legal and regulatory actions were critical to restoring confidence. The challenge before us now is how to achieve the right regulatory balance to allow us to be competitive in today's world while guarding against the recurrence of past abuses."
 [Emphasis added].

He didn't name the law, and he didn't say what needs to be done in a "period of readjustment." Future strong-arming of the SEC and PCAOB? Could be. But in an interview with the Financial Times, SEC Chairman Christopher Cox pretty much dismissed that there was anything needed to be done to the law that the SEC and PCAOB couldn't get done by interpreting the law by themselves.
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