Survey finds internal control assurance carries high price.

Compliance comes at a high cost, according to a Financial Executives International (FED survey of public companies' implementation costs of the Sarbanes-Oxley Act's (SOA's) internal controls requirements (Section 404). The cost of compliance estimates gathered from 321 respondent companies of

Section 404 requires a company's annual report to contain:

* A statement of management's responsibility for establishing and maintaining an adequate internal control structure and procedures for financial reporting

* Management's assessment, as of the end of the fiscal year, of the effectiveness of the company's internal control structure and procedures for financial reporting

In addition, the auditor must attest to and report on management's assessment of the effectiveness of the internal controls and financial reporting procedures.

Although it remains unclear the extent to which SOA will be applied to not-for-profit healthcare organizations, many of the standards are expected to be adopted by many not-for profits' boards.

To read the FEI Executive Summary, go to www.fei.org/news/404_survey.cfm.