Subject: File No. S7-32-04
From: Paul Allen, CPA
Affiliation: SVP-Audit, Planning Budget

August 27, 2004

With regard to the proposed postponement of the final phase-in of the acceration of periodic reporting deadlines, I wish to comment that the SEC should consider a similar one-year postponement of the Section 404 requirements. In fact, I believe those requirements are more important to postpone than the accelerated filing deadlines. It appears to me that most companies are struggling to implement the significant requirements of Section 404, especially considering that the important guidance included in the PCAOB Auditing Standard No. 2 was only approved by the SEC in June 2004. And the PCAOBs Staff Questions and Answers on that Standard was only released in June 2004. Companies and their auditors are being driven to extensive use of outside consultants, due to the complexity of the Section 404 documentation and the short implementation timeframe. While this may improve the consultants understanding of a companys controls and the consultants future value for follow-up consulting engagements, I am doubtful that this outsourced and, rushed approach will improve the Companys internal control environment or add much value to managements own understanding and appreciation of the respective organizations internal controls structure. I am deeply appreciative of the SECs strong leadership in increasing the transparency of financial reportings, and value the underlying concepts of the Section 404 documentation and testing requirements, and therefore, I encourage the Commission to favorably consider the requests for a one-year postponement of the Section 404 requirements. This postponement should allow sufficient time for companies to adequately complete the minimum required documentation and testing, but also provide time to deeply analyze and, where necessary, undertake to improve the existing internal control structure. The SEC has rightly called for a high standard with respect to the responsibility for internal controls for reporting companies, and should allow a reasonably sufficient implementation period to ensure that this critically important process is properly and completely implemented.

In summary, please consider a one-year postponement of the Section 404 requirements.
Respectfully submitted,
Paul S. Allen, CPA