M E M O R A N D U M

On December 12, 2002, members of staff of the Division of Corporation Finance staff met with representatives of the Securities Industry Association about, among other topics, the proposed disclosure in Management's Discussion and Analysis (MD&A) about companies' off-balance sheet arrangements. During the meeting, SIA members indicated that they would not be able to submit a comment letter. The SIA expressed concern about the increased potential for liability in connection with registered offerings. In particular, they are concerned about requiring financial statement-type information in the MD&A without the benefit of auditor expertisation. The SIA also expressed concerns about an underwriter's ability to conduct due diligence on the proposed disclosure.