Europe Must 'Pull its SOX Up'
European companies listed on US stock exchanges are facing a 35% increase in audit fees as a result of mandatory compliance with the Sarbanes Oxley Act (SOX), according to new research by from HandySoft. This equates to an additional annual burden of some 370 million Euros per year, or 1.35 million Euros per company per year. The report also questions how effectively and cost-efficiently these companies will harness technology to help implement SOX without costs escalating. The report also said the average external audit cost for a US-listed European company from 2005 onwards will be 5.19 million Euros as a result of SOX, an increase of some 1.35m Euros over current average audit costs. Across the whole community of these companies, this represents an extra annual burden of around 370 million Euros, according to HandySoft. Furthermore, said the company, by the (European) deadline of 2005, only around three quarters of these companies are expected to implement systems and procedures that effectively establish internal financial controls and that are able to swiftly identify and resolve financial anomalies.