SEC May Delay Accounting Rules

The U.S. Securities and Exchange Commission may hold back on new accounting rules to give companies time to comply, an official said Wednesday.

“We're trying to restrain ourselves in the number of new initiatives that we would put in place,” SEC chief accountant Donald T. Nicolaisen said in an interview.

A major corporate governance rule requiring companies to report on the effectiveness of their internal controls is set to go into effect as early as November for companies with fiscal years ending in that month.

That report is considered by some regulators to be essential to improving the accuracy of financial statements.

Meanwhile, under new accounting rules that go into effect in December, companies must file annual reports within 60 days after the end of a fiscal year.

“We want to stress that importance and really encourage preparers, audit committees, and auditors to make sure that they're all in agreement,” Nicolaisen said.

One way to help companies do that would be to delay the accounting rule requirement. Currently, companies must file annual reports within 75 days, down from 90 days previously.

The agency is considering delaying the effective date of the change to Dec. 15, 2005.

“We've been receiving requests to consider” delaying the 60-day filing requirement, Nicolaisen said.

Separately, Nicolaisen said the SEC's Office of Chief Accountant has almost filled all of the job openings that were created after Congress increased the agency's budget.

“I'm probably less than 30 days away from having everything filled,” he said. The office will have 64 employees, mostly accountants. That is up from about 30 employees in September 2003, when Nicolaisen became chief accountant.

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