Since Sarbanes-Oxley was enacted in 2002, companies have been complaining that its costs outweigh its benefits, and different groups have been lobbying for its reform for just about as long. Earlier this month, the Securities and Exchange Commission took the first steps toward that reform when it proposed relaxed audit requirements for smaller companies, among other changes.
In spite of it all, however, foreign governments model their own corporate reform laws after Sarbox. For example, Japan's version, called J-SOX, will be effective in fiscal year 2008, according to The Japan Times.
A quick read of the story and the FAQ that follows reveals that the law will require approximately 3,800 public companies in Japan to shore up their internal financial controls and then certify the effectiveness of those controls, among other things. Like their counterparts in the U.S., Japanese executives are concerned about the cost of meeting the new requirements -- both in terms of money and manpower.
Thankfully, though, Japanese regulators have also been paying attention to the headaches that Sarbox has caused U.S. businesses and have done what they can to avoid those same headaches from the start. The rules are not as broad as those in the U.S., and requirements differ according to the size of the business, the story says.