The SEC recently stated in a release concerning “footnote 172 shells” that a start-up company does not necessarily fit the definition of a “shell company”. When a publicly traded OTCBB company files with the SEC as a “shell company” or subsequently checks the box as a shell company on its 10Q or 10K filings then [...]

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The SEC has further extended the SOX Section 404 compliance dates for non-accelerated filers and newly public companies. The extensions are intended to reduce compliance burdens by giving the SEC and PCAOB time to pursue ongoing initiatives to streamline SOX Section 404 requirements, in particular for smaller public companies. Absent this latest extension, non-accelerated filers [...]

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The Treasury Secretary’s stance on internal-controls compliance seems to represent a subtle shift away from a strong preference for rolling back Sarbox.
David M. Katz, CFO.com
June 20, 2007
Pushed by a Congressman to stretch the deadline for small-company compliance with the Sarbanes-Oxley Act’s internal-controls provision, Treasury Secretary Henry Paulson held firm on Wednesday to the current filing [...]

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As I outlined in my previous Blog there are five contributing factors that changed the IPO marketplace for small emerging growth companies.
1. The crash of IPO markets in late 2000.
The IPO markets were fueled by one thing in the late 90’s – The Internet.  From 1997 through the end of 1999 just about anyone who [...]

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Since the introduction of Sarbanes Oxley (“SOX”) the opportunities for emerging growth companies to go public via the traditional IPO route has come to a screeching halt.
If you have any doubts look at the charts covering IPO’s from 1999 through the first six months of 2007 as provided by www.ipohome.com.

The reduced number of traditional IPO’s [...]

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On May 23rd the SEC is going to consider approving certain proposals recommended by the SEC Advisory Committee on Smaller Public Companies. The proposals are intended to ease some of the burden under Section 404 of SOX.
The actual agenda from the SEC website:
“The Commission will consider a number of rule proposals addressing the [...]

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SEC Votes to Propose Interpretive Guidance for Management to Improve Sarbanes-Oxley 404 Implementation
FOR IMMEDIATE RELEASE
2006-206
The SEC has finally softened its approach to interpretation of SOX Rule 404.  This is great news for small companies with revenues under $75 million per year who have been dreading this for the past five years.  The SEC has postponed [...]

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SEC compliance, governance and risk management spending is projected to reach almost $30 billion in 2007, according to a recent survey performed by AMR.
AMR research is predicting that public corporations will spend $6 billion in 2007 to comply with Sarbanes-Oxley (SOX) accounting legislation. Sarbanes-Oxley spending will likely account for about 20 percent of overall compliance [...]

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Former Fed Chairman Alan Greenspan was in rare form Monday night when he shocked a Boston business audience by stating that the Sarbanes Oxley rule enacted in 2002 had become a “nightmare” and should be scrapped as soon as possible. Greenspan stated that “the Sarbanes Oxley ruling hampered business, discouraged risk-taking and were driving foreign [...]

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