M E M O R A N D U M

TO:	Rule-Comments
FROM:	Anita T. Klein
DATE:	June 11, 2002
RE:	Release Nos. 33-8098; 34-45907; International Series Release No. 1258 File No. S7-16-02

On February 22, 2002, Bob Herdman of the Office of the Chief Accountant and other members of the Office of the Chief Accountant and the Division of Corporation Finance staff met with representatives of the Financial Executives International (FEI) about, among other topics, disclosure of critical accounting policies in Management's Discussion and Analysis (MD&A) under the Commission's FR-60. They asked about the timing and status of any upcoming rulemaking that would relate to disclosure about accounting policies. During the meeting, FEI members indicated that they agreed with the intent of the disclosure about critical accounting policies reflected in FR-60 but that the general guidance was difficult to apply in practice. They agreed that it was appropriate to send investors the message that estimation is implicit and normal in financial reporting. The FEI members offered to assist the Commission in improving the disclosure.