SEC Refuses to Exempt Small Companies From Reporting Rule

The Securities and Exchange Commission has decided that all companies, including smaller public ones, must comply with the Sarbanes-Oxley Act, MarketWatch reports.

Many smaller firms are not happy with the outcome.

"I think people are waiting to see what happens," said Marie Lee, an attorney with the American Electronics Association, which actively pushed for relief for smaller companies. "But I am still disappointed."

"We are disappointed that the SEC rejected proposed relief for smaller public companies from the excessive burdens of Section 404 of the Sarbanes-Oxley Act," said Wayne Abernathy, the AEA's director for financial institutions policy. "However, we are encouraged that the SEC is looking at some other key relief elements recommended by its advisory committee on smaller public companies," he said.

When the SEC made its decision, it went against the advice of its own advisory panel.