Does SOX 404 Improve Processes?

It may be causing you to stay late far too often, but Section 404 of Sarbanes-Oxley has led to improved processes, according to 65 percent of chief financial officers at technology companies surveyed for BDO Seidman’s 2008 Technology Outlook Survey. The other 35 percent feel 404 has curtailed innovation at their businesses.
“Although technology companies were hesitant to adopt Section 404 of Sarbanes-Oxley, the majority have realized improved processes due to their compliance efforts and do not believe 404 has adversely impacted their level of risk-taking,” said Hank Galligan, a Partner in BDO Seidman’s Technology Practice. “The CFOs at these technology companies are also very optimistic that 404 costs will stabilize this year.”
The survey of 100 CFOs at technology firms with revenues between $100 million and $15 billion also found:

• 53 percent of CFOs believe their 404 costs will hold steady in 2008, 22 percent think costs will climb and 24 percent expect 404 costs will decline.
• Over half (54 percent) of the surveyed CFOs manage Section 404 compliance in-house, while 11 percent who use an external provider. Just over one-third (35 percent) use a combination of in-house and outsourced resources to manage SOX compliance.