Well, the Compliance Week 2010 conference is now done and fading into history. The event was excellent, and credit belongs to all the attendees, speakers and helpers who altogether made our 2010 conference the largest and most successful we’ve ever had. Anyone who didn’t make it to Washington this year can see what you missed on our home page, but let me also share a few wrap-up thoughts here.

Victory for non-accelerated filers? To my thinking, the most surprising news to come out of the conference happened on Tuesday morning while I was interviewing U.S. Rep. Barney Frank, chairman of the House Financial Services Committee, about what final regulatory reform legislation might come out of Congress this month. I posed a question to him about whether the bill will include a provision exempting small public companies from compliance with Section 404(b) of Sarbanes-Oxley. Right now, the House bill does include such a provision, but the Senate bill does not.

“Oh yes,” Frank said with an almost breezy understatement. “An exemption will be in the final bill.”

Um, wow. Perhaps non-accelerated filers will dodge the dreaded 404(b) compliance bullet after all. Frank admitted that he personally does not want an exemption in the bill, but he doesn’t have the votes to block it. At some point, that exemption language will still need to be inserted into the final Senate legislation, but the small business community has support from powerful senators such as John Kerry and Olympia Snowe, who serve on the Senate Small Business Committee. The political survival of the overall bill itself is now assured—I had worried about that earlier this year—so assuming the exemption language does get inserted into the bill, small filers can pop the champagne corks.

I still believe that exempting small filers from Section 404(b) is a dubious idea at best. Yes, compliance with it is a chore, but try telling that to investors at Koss Corp., a tiny company that still managed to defraud shareholders in a big way. Whether we like it or not, strong internal control over financial reporting is important for everyone.

The PCAOB time bomb. Sometime this month, the U.S. Supreme Court will rule on the question of whether the Public Company Accounting Oversight Board’s oversight structure is unconstitutional. It is entirely possible that the conservative majority on the court will side with the conservative activists who brought suit against the PCAOB, and invalidate its existence.

Nobody in Washington is talking about what to do after that.

I asked SEC Commissioner Luis Aguilar how the SEC might want to resolve the issue. He said the commissioners know the problem is out there and they have “Plans A, B and C” to respond, but declined to say what any of those plans might be. I asked Frank as well, and he essentially said his committee would work with the Senate Banking Committee to craft some legislative response, depending on exactly what the Supreme Court’s ruling says.

OK. I understand that the regulators and lawmakers who will have to clean up a damaging Supreme Court verdict must exercise some discretion in what they say before any actual ruling is made. Nevertheless, those answers are not particularly reassuring. We still have a political culture in Washington that foremost is one of paralysis, and the Supreme Court could potentially throw a huge monkey wrench into the corporate governance regime that’s been built in this country since 2002. Responses that tell Corporate America and investors alike, “Oh, we’ll cross that bridge when we come to it,” don’t pass muster. It would be nice if responsible voices in power at least floated some possible scenarios for a resolution to the PCAOB question. If nothing else, it would alleviate some of the uncertainty out there in Governance World, which has plenty enough already.

My prediction: The Supreme Court will rule the PCAOB an unconstitutional body, and ultimately the solution will be to peel away the appointed board and re-organize the rest of it as a Division of Public Accounting operating within the SEC.

The China Syndrome. Compliance officers are getting deeply spooked about doing business in China, and the many legal and security threats that come along with it. In several sessions about compliance with the Foreign Corrupt Practices Act, attendees asked regulators whether they would give extra consideration to companies doing business in risky nations like China. Answer: no.

At another session about export controls, one compliance officer from an electric utility told of how several of his company’s engineers went to China on a sales call. Their gracious hosts gave them flash drives as they were departing with some PowerPoint presentations on them… and computer viruses as well, to hack into their computers back home. This CCO is now forcing employees to use “burn phones” when visiting China and cheap, clean laptops they can leave behind—no company equipment goes into the country, and no Chinese equipment comes out of it. “I feel like I’m in an episode of ‘24’ or something,” he told me. “I mean, come on. I’m a compliance officer.”

Communication counts. We closed Compliance Week 2010 with a presentation from Second City Communications, the corporate training wing of famed comedy troupe Second City. The presentation included three improve actors trying to do sketch comedy on compliance issues (and you thought your job was hard), and in between their skits, the CEO of Second City Communications, Tom Yorton, offered his thoughts on how to communicate effectively with employees.

The word “effectively” has two shades of meaning for compliance officers. First is the practical, nuts-and-bolts chore of delivering a message to your workforce: By email, YouTube video, policy manual or Post-It note, have you stated your message to all your employees scattered around the world? That mechanical effort at communicating is important, yes, so you can demonstrate to regulators that your compliance program has done the best it can.

But as Yorton stressed, “effectively” also has a more subtle and important meaning: Do your employees understand what you’re telling them? Do they absorb that message and change their behavior somehow? Too often they don’t. Too often they merely receive the spoon-fed message you’re obligated to give them (see previous paragraph, above) without really digesting it. They pretend they care, we pretend we’ve reached them—and then sometime in the future when a compliance failure happens, we all wonder how things went wrong.

Well, it all comes down to communication that’s effective in the second sense of the word. And we cannot think about that often enough.