Today's scoop: costs are rising. Not exactly a new revelation but an issue that is growing more prominent as electronic data proliferates.
Morgan O'Rourke of Risk Management magazine reviews the high cost of litigation costs for American businesses. As if that is not enough, John Roberts (no, not that John Roberts) weighs in on the topic of the costs of federal regulatory compliance, which he reports reached over one trillion dollars in 2004. Last but not least, David M. Katz of CFO.com reports on a recently-filed lawsuit that raises the possibility of invalidating Sarbanes Oxley. That sounds like a very long shot, at best, to us, but we have seen stranger outcomes in court.
By Morgan O'Rourke
Litigation costs are a pernicious hidden tax for American businesses, as almost 90% of companies are currently engaged in lawsuits, according to international law firm Fulbright & Jaworski’s 2005 Litigation Trends Survey of in-house corporate counsel. The average company faces 37 lawsuits at any given time, and for those companies with $1 billion or more in revenue, that number jumps to 147 cases.
Read the rest of the article on the Risk and Insurance Management Society website at http://cataphora.com/out.php?go=xl68g
By John Roberts
The annual cost of federal regulatory compliance for businesses and private citizens reached $1.1 trillion in 2004, up 16 percent since 2000, according to a study by the Small Business Administration.
On the corporate side, small businesses defined in the SBA study as those with fewer than 20 employees bear the largest burden. The average per-employee cost of complying with federal regulatory requirements for small businesses amounted to $7,647 in 2004. This was 45 percent higher than for large businesses, defined as those with 500 or more employees.
You can find the rest of this piece at http://www.crn.com/sections/columnist/columnist.jhtml?articleId=181502686
David M. Katz
By challenging the constitutionality of the Public Company Accounting Oversight Board, plaintiffs in a lawsuit filed last week believe that they can spur the courts and Congress to undo the entire Sarbanes-Oxley Act.
More details on CFO.com at http://www.cfo.com/article.cfm/5516686/c_2984311/?f=archives
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