ARMA files comment with the SEC.

The Securities and Exchange Commission (SEC) recently released for comment the proposed rule for records retention under Section 802 of the Sarbanes-Oxley Act. This proposed rule addresses the five-year retention period and other criteria for audit workpapers and other documents. It also discusses the differences between this section's requirement and the seven-year retention requirement in Section 103, and poses questions for comment regarding specific document retention policies and requirements.

The U.S. Government Relations Committee (GRECO) of ARMA International submitted its official comment, excerpted below, regarding three questions from Proposed Rule: Retention of Records Relevant to Audits and Reviews per File No. S7-46-02:

Section 103 of the Sarbanes-Oxley Act directs the Public Company Accounting Oversight Board to adopt an auditing standard that requires each registered public accounting firm to retain for a period of not less than seven years audit workpapers and other information that support the conclusions in the auditor's report. Should the retention period in the proposed rules be extended to seven years to coincide with the retention period in Section 1037

"There is no rationale found in any commentary for the seven-year time period stated in 103. The rationale for Section 802 could be assumed to be five years due to the lengthening of the statute of limitations to five years. If there is no valid, substantive reason for a longer retention period, the five-year retention period should be recommended. If the shorter time period of five years under Section 802 cannot be used for Section 103, then it would (be) recommended to lengthen the retention period to seven years for uniformity."

Should the retention period be for some other appropriate period based on consideration of other...