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Christmas Comes Early in Washington
December 20, 2005

When we offered our last comment regarding the need for relief for smaller companies from Sarbanes-Oxley filing requirements,�we had no idea the SEC would act within hours of our publication. Christmas comes early in Washington for smaller companies.

Under the SEC's concession, non-accelerated filers will continue to file annual reports on Form 10-K or 10-KSB under the 90-day deadline and quarterly reports on Form 10-Q or 10-QSB under the 45-day deadline. The amendments also will not impact Form 20-F or Form 40-F filing deadlines applicable to foreign private issuers.

For fiscal years ending on or after December 15, 2006, however, large accelerated filers will be subject to the shortened 60-day deadline. Form 10-Q filing deadlines indefinitely will remain 40 days for all large cap companies that comprise the accelerated filers. Look for additional signs of dispensation from Washington for business and consumers alike as the next election cycle draws to a conclusion in the US.� While nearly a hundred larger firms requested a filing extension from the SEC in the past quarter, this according to Glass, Lewis & Co., there may be no extension available for the Republican political majority in the US Congress, which over the past five years has delivered big for large business.

It is not the increasingly successful Iraq war, but stupidity and corruption in Washington, which most threatens the GOP as 2006 begins. Many members of the accelerated filer community begin to worry, and with reason, that the age of Republican hegemony may be following indicted lobbyist Jack Abramoff and indicted Rep. Tom Delay (R-TX) into the history books. As the holiday season commences at the end of 2005, companies large and small are wondering how to get that unique provision or special favor pushed through Washington before Americans go to the polls next year.

Bankruptcy and litigation reform, and four years of negative real interest rates, are only some of the goodies which corporate America has garnered under Bush II, but the party may be nearing its end. Rising interest rates and bank loan defaults, and the growing possibility of�bankruptcy filings by General Motors (NYSE:GM) and/or Ford Motor (NYSE:F), will all weigh on the financial markets during 2006, but for American business, the end of the era of Republican political monopoly in Washington is the big risk looming on the horizon.

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