Date:    9/1/98  10:08 AM

Subject: File No. S7-16-98

File No. S7-16-98
     
This email provides comment on the SEC's proposed amendment to Rule 102(e) 
of its Rules of Practice.
     
I oppose the proposal as currently drafted.  While I support the need for 
clarification of Rule 102(e), I would like to see the proposed rule modified 
to be consistent with the AICPA's proposed definition.
     
The accounting profession is currently suffering from an inability to 
recruit the best and brightest for a variety of reasons.  One of the reasons 
the accounting profession is disadvantaged is that accounting professionals 
must work in an environment that exposes them to substantial risk of 
liability for non-compliance with professional accounting standards.  While 
compliance with accounting standards is a cornerstone of our profession that 
I support, I believe accountants are unreasonably exposed in our litigious 
society.  I believe the proposed amendment to Rule 102(e), as currently 
drafted, will exacerbate this issue.
     
The proposed amendment is drafted very broadly and gives the SEC an 
unreasonable amount of discretion in sanctioning accountants for improper 
professional conduct.  It is unreasonable to think that an environment in 
which the SEC has a license to sanction an accountant on matters of judgment 
regarding the preparation of financial statements will benefit the public 
interest.  Additionally, it is inappropriate for the SEC to hold accounting 
professionals to a higher standard of conduct when practicing before the SEC 
than those standards applied to an attorney or non-financial corporate 
officer or director.
     
I urge the SEC to reconsider the proposed rule drafted by the AICPA, as the 
SEC proposal is not consistent with the interests of the accounting 
profession and, most importantly, the interests of the investing public.
     
Thank you for the opportunity to comment and for your consideration of these 
comments.
     
Thomas Arnold
Vice President and Corporate Controller 
Storage Technology Corporation