From: Fred Lawrence  
Sent: Monday, April 22, 2002 12:54 PM 
Subject: File Number S7-08-02 
 
In my opinion the speed in which the documents are provided 
is not the issue that needs to be addressed. The issue is 
accountability achievement, accuracy of information, and 
reporting that the general public can understand.  
 
In establishing rules for accountability, obviously you 
start with the Board of Directors. Too many times these 
positions are filled with individuals that do not have the 
expertise to be on a Board. Regulations should be put into 
place that establish a level of Standards for qualification 
to be on a Board. In addition, there should be very specific 
accounting knowledge for Board Members who set on the Audit 
Committee. The Board MUST be more active on a daily basis 
than what they are today. They only meet quarterly or in 
some cases sporadically. The entire Board should have to 
meet monthly. The Audit Committee should be a resident in 
the company meeting with the financial people on a regularly 
scheduled basis monthly. They should have to get involved 
deeply into the books of the company and have the power to 
override accounting decisions that in their mind is 
inappropriate. As to the accountability issue each Board 
Member should have a mandated minimum fine and prison 
sentence if there is the same situation as Enron. The audit 
committee should be held to a higher standard, with sever 
fines and prison sentences. 
 
Relating to accuracy of information, the rules of accounting 
should become simpler in nature. There should be a single 
set of rules as opposed to FASB, SAS, etc. All of these with 
different applications for the same situation. There is no 
defining boundaries between bending the rules and breaking 
them. This is the result of too many opinions in too many 
documents to follow. The research to reach a decision on how 
to record transactions is too difficult. I have had three 
different big audit firms audit the company. In each case I 
got a different answer on how revenue is to be recorded. One 
of these was negligence basing the issue on materiality 
(which was set way to high), the second followed the same 
pattern, the third was very strict. The first audit firm was 
changed due to the company recognizing a conflict of 
interest and terminating the engagement. The second was 
terminated because of just a poor audit. The third is still 
with us. 
 
When discussing the reporting issues the SEC has done a good 
job in requiring that the initial filings to go public be in 
plain English. The SEC stopped too soon. There should be 
rules that all filings and publications of results including 
the annual report should be in plain English. The footnotes 
on many occasions is too complicated to understand. This 
should be revised. I know I am a CPA and I can not 
understand the annual report of a Utility company with out 
pulling all regs and studying the documents carefully. If I 
have this kind of trouble and I am trained in the field, how 
can a small untrained individual possible comprehend the 
information. 
 
Fredric A. Lawrence  
Vice President of Finance & Administration (CFO)  
512-491-0550 ext 389  
e-mail: flawrence@advsol.com