May 22, 2002 Securities and Exchange Commission 450 Fifth Street, N.W. Washington, D.C. 20549 Attention: Jonathan G. Katz, Secretary File No. S7-08-02 Re: Acceleration of Periodic Report Filing Dates and Disclosure Concerning Website Access to Reports Release Nos. 33-8089; 34-45741 Mr. Katz: SBC Communications Inc. (SBC) appreciates the opportunity to comment on the Commission's proposed rules regarding accelerated filing of Forms 10-K and 10-Q. We are a large, international corporation with an equity market capitalization in excess of $100 billion and our securities are actively traded on the New York and other domestic stock exchanges. Our public financing activities primarily consist of offering investment-grade debt off of shelf registration statements and investment-grade commercial paper. In proposing the accelerated filing dates, the Commission notes the deadlines have not changed in 30 years. The Commission also states that there have been numerous improvements in financial information systems in that time, suggesting that a shortened filing period should be a natural by-product. However, during that same time, there have been other factors that have added to the time required to prepare filings that adequately meet investor needs. Most businesses have become significantly more complex during the 30-year period cited in the proposal. Accounting and financial reporting requirements have similarly expanded and become more complicated; Statement of Financial Accounting Standards No. 1 was not even issued until December 1973 and the first Emerging Issues Task Force Consensus was issued in 1984. This increase in complexity is demonstrated by the continual increase in the degree of disclosure both in the footnotes to the financial statements and in management's discussion and analysis of operations. As an example, the financial section of our printed annual report has more than doubled in the last decade. The Commission has also emphasized that Boards of Directors of public companies, and especially Audit Committees of those Boards, should become more involved with review and oversight of a company's financial statements. The Commission has also stated that more discussion, rather than less, of a company's operations and accounting policies should be included in filings. Additionally, independent auditors are expected to take greater responsibility associated with all aspects of a company's filings. We agree with, support and have complied with all of these Commission efforts. Finally, an additional factor affecting the timing of filing is the EDGAR process. We were an EDGAR pilot filer and continue to be a strong supporter of the Commission's EDGAR concept. Nonetheless, the need to convert documents from readily accessible word processing, spreadsheet or Adobe acrobat files for filing with the Commission is a time consuming process. Our most recent Form 10-K filing and exhibits took well in excess of a week to convert, and our Form 10-Q filing approximately half a week. Were EDGAR able to accept standard file formats, the filing process could be shortened. We have historically filed our Form 10-K approximately 70-75 days after the end of our fiscal year, and our Form 10-Q closer to 40 days after the quarter's close. There have been occasions, however, when significant events have occurred after the close of a quarter, or significant analysis is needed and, in order to include such information, it has taken us up to 44 days to file. With the Commission's proposals in mind, we accelerated our filing schedules this year, filing our Form 10-K in 59 days and our 1st Quarter Form 10-Q in 33 days. Both of these schedules were very tight. While we were able to complete the type of management review with which we feel comfortable and were able to review our documents with our Audit Committee before filing, the timing leaves little margin for flexibility to respond to unforeseen events or questions. While we recognize that a Form 8-K could be filed at a later date to report any changes to the Form 10-Q, we believe that frequent use of that Form to supplement a hastily prepared Form 10-Q could damage our credibility with the investment community. We support the Commission's efforts to accelerate the timing of filings, but believe the proposed rules advance the process too far, especially for the quarterly reports. While we believe 60 days would normally be achievable for an annual filing, we respectfully submit that 70 days would provide a margin of flexibility to companies, especially considering the current EDGARization process. We do not support the proposed change in the quarterly filing deadlines to 30 days. We believe this accelerates the process to the point where some level of internal management review will be compromised, affecting the quality of disclosure. Many companies do not release earnings in that timeframe or much in advance of it. Accordingly, we do not believe that an acceleration of the quarterly filing deadlines is necessary. If the Commission believes the deadlines still need to be advanced, we believe 40 days would be a more reasonable deadline and that anything less than 35 days significantly raises the risks of compromising the quality of disclosure. We also note that the Commission's proposal only addressed domestic companies, not foreign filers who are already given a significantly lengthened filing schedule. One of the major changes in the 30-year timeframe noted by the Commission has been the globalization of the nation's economy and the dramatic increase in foreign filers. We believe that should the Commission make changes to filing requirements for domestic companies, there should also be similar changes to deadlines for foreign filers to narrow or eliminate this timing gap. The Commission is also proposing that all companies with a website be required to post their public filings on their websites on the same day as the filings are made. We have historically posted our annual report on our website on the day we file. Additionally, we provide links to the Commission's website so that all of our filings on EDGAR are readily available. Our filings are therefore available on the internet as soon as the Commission posts them to its website. We find it ironic, however, that our actions would not be in compliance with the proposed regulation as the Commission does not post filings on its website on the day they are filed. Accordingly, we do not support the rule as proposed. While we support the concept of making it easy for investors to access our filings, we believe that is best achieved by providing a seamless link to the Commission's website where all our official filings are contained. We do not believe that a company should be held at fault if there is a delay in posting its filing in the Commission's database. In conclusion, while we support the Commission's desire to place information in investors' hands in a more timely manner, we do not want to see this desire conflict with the more basic tenant of providing meaningful disclosure in an understandable format. While we believe the 60-day timeframe proposed by the Commission is achievable, 70 days would allow for greater flexibility. We do not believe that an acceleration of the deadline for filing quarterly reports is necessary and that a 30-day filing deadline for quarterly reports could compromise the overall quality of disclosure. Finally, we encourage the Commission to continue to enhance the EDGAR process to allow for filing of more common files and posting of those files in a more timely manner. We would be pleased to discuss our comments with the Commission or its staff at your convenience. Very truly yours, SBC Communications Inc. Randall Stephenson Senior Executive Vice President and Chief Financial Officer