What impact has the Sarbanes-Oxley Act had on compliance costs for public companies? Substantial, it turns out, even five years after it became law.

The Sarbanes-Oxley Act was enacted in mid-2002 to improve corporate financial reporting after the Enron, WorldCom and other accounting scandals. Opinions vary widely on its success in preventing fraud and increasing investor confidence, as well as on whether its benefits justify the costs. But virtually everyone agrees that the compliance costs associated with Sarbanes-Oxley have been, and continue to be, extraordinarily high — even five years after Congress passed the sweeping law.