Forty-nine percent of the 100 CFOs surveyed identified Section 404 as the greatest challenge, 36 percent said FIN 48, and 12 percent cited 409A.

Although there has been much criticism of the difficulties involved in complying with Section 404 of Sarbanes-Oxley, 65 percent of the CFOs of tech businesses feel that 404 has led to improved processes, compared to 35 percent who feel 404 has curtailed innovation at their businesses. 

While 39 percent of these financial executives believe Section 404 has curtailed corporate risk-taking at their companies, a majority (59 percent) feel risk taking has not been impacted.

A majority (53 percent) of the CFOs believe their 404 compliance costs will stabilize this year, compared to 22 percent who anticipate costs to climb and twenty-four percent that expect a decline.

Over half (54 percent) of technology companies manage their Section 404 compliance functions in-house versus only 11 percent that outsource the function to an external provider. Just over one-third (35 percent) of the CFOs indicated they manage their 404 compliance through a co-sourcing relationship (a combination of in-house and outsourcing) with an external provider.

"Although technology companies were hesitant to adopt Section 404 of Sarbanes-Oxley, the majority have realized improved processes due to their compliance efforts and do not believe 404 has adversely impacted their level of risk-taking," said Hank Galligan, a partner in BDO Seidman's Technology Practice. "The CFOs at these technology companies are also very optimistic that 404 costs will stabilize this year."

Two-thirds (67 percent) of CFOs said their company's compensation plans have been impacted by legislative and regulatory changes, such as 409A and FAS 123R, focused on improved disclosure. Of those impacted, over one-quarter (27 percent) described the impact as high, 37 percent described the impact as moderate and 36 percent said low.