In a report released Tuesday, ratings agency Fitch outlined its support for the creation of a formal regulation of not-for-profit healthcare providers that mirrors the Sarbanes-Oxley Act of 2002, including the controversial section on auditing, Section 404. Even though not-for-profits are not legally bound by Sarbanes-Oxley, Fitch executives believe the law's accountability and reporting requirements represent best practices "that should be embraced by hospitals and healthcare systems (or providers)," according to the report. Although the costs of complying with Section 404 of the law can be costly, not-for-profits should at least evaluate the quality of their internal auditing function, said John Wells, senior director and author of the report. In the report, Sarbanes-Oxley and Not-for-Profit Hospitals: Increased Transparency and Improved Accountability, Fitch also describes the nine sections of Sarbanes-Oxley that are most important for healthcare providers and to Fitch's ratings process. -- by Paul Barr
Fitch: Sarbanes-Oxley valuable for not-for-profits, too
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