Good news for corporate finance officials: The cost of complying with Section 404 of the Sarbanes-Oxley Act — the provision that requires management to assess the effectiveness of their companies’ internal controls — is dropping.

That’s according to a new study from Finance Executives International. The study shows that compliance costs among “accelerated filers” — companies with market capitalizations above $75 million — fell 23 percent in 2006. The amount of staff time devoted to compliance also fell, according to the study.

“While there is still work to be done, we have come a long way, and total compliance costs have dropped about one-third since year one,” said FEI President and CEO Michael P. Cangemi. “This drop is largely attributed to increased efficiencies, a positive learning curve, and technical systems and software rollouts. We are hopeful that pending guidance from the SEC and PCAOB will further reduce 404 expenses.”

What do you think? Is complying with Section 404 becoming less burdensome? Are further revisions necessary? Click “Comments” below and let us know your thoughts.