Dodd-Frank Financial Reform Act

In reviewing the recently enacted Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act), we found two very different sections worthy of brief note.

Small Issuers exempted from auditor certificates as to accounting controls.

Section 989G of the Dodd-Frank Act, eliminated immediately, the need for an auditor's certification as to management's assessment of the adequacy of an issuer's accounting controls for issuers that are categorized as non-accelerated filers or smaller reporting companies. This costly residuum of Section 404 of Sarbanes-Oxley was scheduled to be effective for the upcoming fiscal year after several years of extensions by SEC rule making. Smaller issuers were anticipating the additional audit fees associated with such certification and had incurred substantial fees in enhancing accounting controls to satisfy such audit. A small benefit conferred to some issuers by Congress.