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Dodd-Frank Act permanently exempts smaller US issuers from SOX 404(b)

The Dodd-Frank Act has permanently exempted non-accelerated filers from the Sarbanes-Oxley auditor attestation requirement on internal controls.

The Dodd-Frank Wall Street Reform and Consumer Protection Act has today been signed into law in the United States, and section 989G permanently exempts non-accelerated filers from Sarbanes-Oxley section 404(b).

Key points

  • Smaller public companies no longer need an external auditor’s attestation on internal control over financial reporting.
  • Management must still assess and report on internal controls under section 404(a).
  • IT general controls, such as access management, change management and backup, remain central to that assessment.
  • Larger accelerated filers remain subject to full auditor attestation.

UK service providers supporting US-listed clients should continue to expect requests for SOC 1 reports and evidence of strong IT general controls.

Source: Dodd-Frank Wall Street Reform and Consumer Protection Act, H.R.4173 (congress.gov)

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