Read this article in full here:  http://www.corporatefinancialweeklydigest.com/2010/11/articles/seccorporate-1/sox-404-a-sixthyear-evaluation/

Here is a snippet:

The SOX 404 Dashboard - Year Six Update, published in October, reports that in year six of SOX 404, only 2.4% of filings contained adverse auditor attestation disclosures. This represents a more than 50% drop since year five, in which the adverse disclosure rate came in at 5%, and an even more significant drop since year one, in which the adverse disclosure rate was 16.9%. The study shows a steady decline in adverse auditor attestations throughout the six years of SOX 404’s existence and suggests that auditor involvement in the evaluation process may have led to the improvement of companies’ ICFRs. However, the study also shows that adverse disclosure rate for management-only assessments continues to be high—27.8% in 2010. Nonetheless, the year six figure reflects a drop from 32.3% in year five, 32.0% in year four, and 32.8% in year three. The study suggests that the high percentage of adverse management assessments indicates that non-accelerated filers fail to maintain ICFRs that are as reliable as ICFRs maintained by accelerated filers.

It is not surprising to us that non-accelerated filers controls are not as reliable as accelerated filers controls.  As one person put it, if you knew there were no cops, would you obey the speed limit?  The lack of auditor review has a direct correlation to the lack of control quality and hence, the lack of financial statement reliability.  And yet, investors are still eager to believe what they read...