In 2006, there will be key differences in how budgets are spent. Budgets allocated to internal headcount are expected to fall by eight percent while the technology allocation will grow by more than 13 percent in real dollars over 2005 numbers. External consulting activities, which do not include audit fees, are expected to hold steady in 2006.

• $2.3 billion (39%) - Internal labor / headcount
• $1.9 billion (32%) - Technology
• $1.8 billion (29%) - External consulting

Technology is playing an increasingly significant role in the integration of SOX compliance initiatives into business processes. Throughout 2005,
companies reported that they were refining existing business and IT controls in preparation for automation efforts using technology.

"These spending predications support a long-term approach to SOX compliance," said John Hagerty, vice president of research at AMR Research.
"Budgets are shifting from headcount to technology so that compliance can become repeatable, sustainable, and cost-effective."

AMR Research also found that 39 percent of companies currently have an operational SOX solution, while 37 percent are implementing one in 2005. Even so, over 80 percent of companies plan to add to or improve on what they have in place in 2006.