NAICSOXJune02jc –75 lines
Section 404 Remains A Sticking Point
When state insurance regulators meet in mid-June to discuss incorporating elements of the Sarbanes-Oxley Act of 2002 in a model audit rule that is in place in 39 states, two of three pieces under discussion will be moving toward completion.
Recent discussions regarding Titles II and III potential changes, auditor independence and corporate governance, respectively, have resulted in changes that could be incorporated into draft revisions of the Model Regulation Requiring Annual Audited Financial Statements, also called the Model Audit Rule. MAR is a model of the National Association of Insurance Commissioners, Kansas City, Mo., which will be holding its summer national meeting June 11-14.
These two components of SOX changes will be held until work on Title IV which covers internal controls is finalized, says Doug Stolte, chair of the NAIC/AICPA working group and deputy commissioner of Virginia’s bureau of insurance. The goal is that all components will be advanced together through the NAIC and then be brought as one change to state legislatures, he explains.
Stolte has argued that recent events including restatement of financial statements at American International Group, New York, underscores the need for more stringent auditing requirements at the state level as well as the federal level.