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Long, but you failed to cover the consequences for the single most critical point of this Act: rollback of independent accounting requirements.

No other developed nation in the world would even consider such a fundamental change to public offerings. In the financial world, i.e. financial startups, this would be a direct invitation for fraud, guaranteed.

Also, given how much you have quoted from history, you all of all people must recognise the opportunity cost and consequences from bad legislation is irrecoverable and it itself sets off a chain of other events that in turn are irrecoverable. That is, entropy applies to all systems and that this sentence, "nothing will stop Congress from pulling back" is completely missing the point in terms of damage potential. You do not just "try" new laws, you learn from your mistakes and make sure you put into place only that which causes least harm at the minimum.

Be sure that if this classic Anglo-American capitalist, short-termist legislation is applied, it will do at least as much harm to the startup scene (of all types, not just technology) as the previous boom-and-bust did. It is precisely the kind of legislation and groupthink that creates enormous financial bubbles and will eventually have an impact on completely ordinary people, but not the sharpest of investers, bankers and most of all, lawyers - "just" the rest of us.

Note. None of the large or most powerful technology companies that exist today were formed during such periods of destructive wealth creation.




I was amazed that they may have removed the requirement for an independent audit of the accounting, but after looking into the changes it looks like it absolutely doesn't remove the requirement for an audit. Based on the summary that I read it looks like the main change with respect to an audit is that it only goes back two years from the IPO instead of five, and the auditor doesn't have to do a test of the internal controls. In practice this doesn't diminish the value of the audited financials nearly as much as your post would suggest.

[0] http://auditorsopinion.com/2012/04/04/the-jobs-act-debate/


You are indeed correct, thank you.

The article is highly misleading on that particular point. Given how extraordinary a claim it was (enough for me to take the time to write a response to it), I should have double-checked it from an alternate source!


This is a recurring problem with Matt Taibbi's writing, which is worth knowing, because any time Taibbi writes something that remotely bears on startups, technology, or the finance industry, it's sure to be plastered to the front page on HN.




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