SOX and US Competitiveness (The Bloomberg & Schumer Report)

The Mayor of New York City, Michael Bloomberg, and Senator Charles Schumer recently released a report prepared by McKinsey & Co., which focuses primarily on US Competitiveness in the securities and investment banking sectors.  The report addresses the impact of SOX on US competitiveness.  It does not take the position that the cost of implementation and compliance far outweighs its benefits.  The report does, however, recommend that small and foreign companies be allowed to opt out of the requirements of Section 404 (the provision that requires outside auditors to attest to management's assessment of the company) and that there be more comprehensive guidance with regard to Section 404.

The report has already stirred up some criticism in themedia, and attracted colorful commentary found onAAO Weblog and theSOX First blog.