August 14, 2002

Jonathan G. Katz, Secretary U.S. Securities and Exchange Commission 450 Fifth Street, NW Washington, DC 20549-0609

Re:	File No. S7-16-02; Proposed Rule: Disclosure in Management's Discussion and Analysis about the Application of Critical Accounting Policies

Dear Mr. Katz:

We appreciate the opportunity to comment on the Commission's proposed rule on disclosure in Management's Discussion and Analysis about the application of critical accounting policies (the Proposed Rule). We support the Commission's objective of providing information to enhance financial statement users' understanding of companies' critical accounting policies.

Through our membership in the Securities Industry Association (the SIA), we participated in the development of its comment letter to the Commission on this matter dated August 8, 2002. The SIA's letter thoroughly addresses the many complex and unique issues that will confront companies in the securities industry if they are required to implement the Proposed Rule as written. The letter suggests several ways the Proposed Rule could be changed to enhance financial statement users' understanding of information about, among other matters, the fair value accounting estimates unique to the securities industry.

We support the SIA's comment letter and urge the Commission to give careful consideration to the complex implementation issues and recommendations for enhancement contained in that letter.

Sincerely,

/s/ Sarah G. Smith

Sarah G. Smith
Chief Accounting Officer

Cc: Robert K. Herdman, Chief Accountant