WASHINGTON, Aug. 9 /PRNewswire/ -- Jim Greenwood, the president and CEO
of the Biotechnology Industry Organization (BIO), today commended the
Securities and Exchange Commission (SEC) for proposing to extend the
deadline for smaller public companies to comply with Section 404 (internal
controls) of the Sarbanes-Oxley Act.
"The proposal demonstrates that the SEC is considering the full weight
of Section 404 on smaller public companies," said Greenwood. "Section 404
is creating costly, unintended burdens on smaller firms that frequently
operate with limited or no revenues."
Under the proposal, non-accelerated filers (companies with less than
$75 million in market capitalization) would not be required to comply with
the costly external auditor attestation requirements in Section 404 until
Dec. 15, 2008. The SEC also proposed a transition period for new public
companies which would delay Section 404 compliance requirements to the date
of a company's second annual report.
"Four years after enactment of the Sarbanes-Oxley Act, it is necessary
to correct sections that are having unforeseen and detrimental effects on
smaller public companies. BIO will continue to work with other affected
industries and the SEC to ensure that emerging companies remain competitive
and are not forced to divert valuable research and development dollars to
administrative tasks," Greenwood said.
Today's release follows the July 11 publication of a Concept Release on
guidance for management designed to assist companies in assessing their
internal controls over financial reporting.
BIO intends to submit comments on the Concept Release as well as
today's proposals. In its comments, BIO will provide a detailed reform
framework that takes a risk-based, cost-effective approach to internal
controls. Section 404 should be based on the level of product revenues,
which defines the complexity of corporate structures and the need for
increased controls.
BIO represents more than 1,100 biotechnology companies, academic
institutions, state biotechnology centers and related organizations across
the United States and 31 other nations. BIO members are involved in the
research and development of healthcare, agricultural, industrial and
environmental biotechnology products.
SOURCE Biotechnology Industry Organization
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Related links:
http://www.bio.org
CONTACT:
Kim Coghill of Biotechnology Industry
Organization, +1-202-962-9232
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