Patrick Mannion's piece, "Accountability's fear factor" asks, "Do you believe U.S. technological and corporate competitiveness in the global community has been handicapped by Sarbanes-Oxley and the SEC?"
It is hard to prove cause and effect, but it is also hard to imagine how Sarbanes-Oxley would not have an effect, especially from a pre-IPO company perspective. Now, suddenly you have to face the fact that if you try to get access to a capital market, you would have to invest at least a couple of million dollars in compliance. The oxygen of small companies-that is, time and money-can't be drained toward building massive systems for compliance.
What should be done about it? Mannion asked. From a narrow viewpoint of a smaller company, at the very least, Congress should allow an aggressively relaxed set of rules for smaller companies. These rules should take into consideration or put greater weight on the management representation aspects of Sarbanes-Oxley. Less emphasis should be placed on inefficient and overly burdensome compliance aspects of an annual audit.
Sanjay K. Srivastava
President and CEO
Denali Software Inc.
Palo Alto, Calif.