Abercrombie & Fitch 2011 Annual Report Download - page 27

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Compliance with changing regulations and standards for accounting, corporate governance and
public disclosure could adversely affect our business, results of operations and reported financial
results.
Changing regulatory requirements for corporate governance and public disclosure, including SEC
regulations and the Financial Accounting Standards Board’s accounting standards requirements are
creating additional complexities for public companies. For example, in July 2010, the Dodd-Frank Wall
Street Reform and Consumer Protection Act, or the Dodd-Frank Act, was enacted. There are significant
corporate governance and executive compensation related provisions in the Dodd-Frank Act that require
the SEC to adopt additional rules and regulations in these areas such as “say on pay” and proxy access.
Stockholder activism, the current political environment, financial reform legislation and the current high
level of government intervention and regulatory reform may lead to substantial new regulations and
disclosure obligations. In addition, the expected future requirement to transition to, or converge with,
international financial reporting standards is creating uncertainty and additional complexities. These
changing regulatory requirements may lead to additional compliance costs, as well as the diversion of our
management’s time and attention from strategic business activities and could have a significant effect on
our reported results for the affected periods.
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