Despite the recommendation in your report, and in the Schumer-Bloomberg study, that Congress amend the Sarbanes-Oxley Act, I want to state clearly this morning that I disagree. While of course it's up to the Congress to determine its legislative priorities, both the House and the Senate have formally asked my advice on this point, in hearings on the subject of Sarbanes-Oxley, and I have repeatedly given it. We don't need to change the law, we need to change the way the law is implemented. It is the implementation of the law that has caused the excessive burden, not the law itself. That's an important distinction. I don't believe these important investor protections, which are even now only a few years old, should be opened up for amendment, or that they need to be.

The SEC has the power and the necessary flexibility to implement the law in a way that makes sense for investors and markets. And your input is a valuable tool in helping us make those changes so that Section 404 operates as intended. In particular, we've been able to phase in the application of the internal controls requirements of Section 404, with appropriate deferrals for public companies of different sizes – so that even today, nearly five years after the Act, smaller public companies are not yet required to comply with this provision.