US audit quality body defends Sarbox

A US audit quality body has defended Sarbanes-Oxley and warned against
changing the rules, saying it has brought about improved efficiency.

Cindy Fornelli, executive director for the Centre of Audit Quality said that
the gains are ‘too significant to ignore, and too valuable to the American

‘Any adjustments to the rules mandated by the Act must carefully weigh
efficiency and effectiveness against the Center for Audit Quality’s twin goals
of protecting investors and the markets,’ she said. ‘For the scale to dip too
low in either direction would risk a return to rock bottom.’

The Centre recently conducted a nationwide survey, which showed that four out
of five US investors have confidence in their market, the FT reported.

‘Additionally, 80 per cent expressed confidence in the audited financial
information released by publicly traded American companies,’ said Fornelli.
‘That is a marked rise since before the [Sarbanes-Oxley] bill was signed, when
only 31% of investors reported confidence in the markets.’

Fornelli said the Act is an even better example of how good public policy can
bolster investor confidence, which is central to economic growth.

Further reading:

for Audit Quality Survey Finds Majority of Nation’s Investors Support
Sarbanes-Oxley, Believe Rules Mandated By Act Should Not Be Eased

Related reading

Fiona Westwood of Smith and Williamson.