Mail Stop 0306
April 22, 2005
By U.S. Mail and facsimile to (908) 412-5989
Mr. Thomas C. Shields
Senior Vice President and Chief Financial Officer
Anadigics, Inc.
141 Mt. Bethel Road
Warren, New Jersey 07059
RE: Anadigics, Inc.
Form 10-K for the fiscal year ended December 31, 2004
File No. 000-25662
Dear Mr. Shields:
We have reviewed your filing and have the following
comments.
We have limited our review to only your financial statements and
related disclosures and will make no further review of your
documents. Where indicated, we think you should revise your
document
in future filings in response to these comments. If you disagree,
we
will consider your explanation as to why our comment is
inapplicable
or a revision is unnecessary. Please be as detailed as necessary
in
your explanation. In some of our comments, we may ask you to
provide
us with supplemental information so we may better understand your
disclosure. After reviewing this information, we may or may not
raise additional comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects. We welcome
any questions you may have about our comments or on any other
aspect
of our review. Feel free to call us at the telephone numbers
listed
at the end of this letter.
Form 10-KSB for the fiscal year December 31, 2004
Item 7. Management`s Discussion and Analysis of Financial
Condition
and Results of Operations - Page 16
Results of Operations - Page 20
Net Sales - Page 22
1. We see from your segment information on page 42 that you have
significant revenues from foreign operations. In future filings,
where significant, please quantify the impact of changes in
exchange
rates on reported revenues and expenses.
Gross Margin - Page 22
2. We note your discussion of the factors that caused the improved
gross margin of 15 percent in 2004 as compared to 2003. Factors
such
as lower depreciation expenses and lower product costs should be
quantified and discussed so that investors would understand why
they
were lower in 2004 as compared to 2003. Please apply in future
filings. Also, each significant factor that contributed to the
significant variances in expense amounts for each period presented
should also be quantified and discussed. Please apply throughout
MD&A to the extent practicable in future filings.
Financial Statements
Note 1: Summary of Significant Accounting Policies
Revenue Recognition - Page 37
3. Please revise future filings to expand your revenue recognition
policies to discuss the following:
a. Since you record revenue when products are shipped to customers
disclose when title transfers.
b. With respect to product sales, revise and expand future filings
to
describe customer acceptance provisions and the nature and extent
of
any post shipment obligations, such as installation and training,
and
how the obligations are considered in your revenue practices.
c. Provide details of whether your have multiple element
arrangements
as discussed in EITF 00-21.
4. As a related matter, we note on page 8 that you utilize
distributors to sell some of your products. In future filings,
revise to expand your revenue recognition policy to specifically
address transactions with distributors including payment, return,
exchange, price protection, discounts, sales incentives and other
significant matters.
5. If shipping and handling fees and/or costs are material, please
quantify these revenues and costs and explain in future filings
how
they are classified in the income statement.
Note 5 - Segments - Page 42
6. Please revise future filings to disclose the amount of long-
lived
assets by geographic area. See paragraph 38(b) of SFAS 131.
* * * *
As appropriate, please respond to these comments within 10
business days or tell us when you will provide us with a response.
Please furnish a cover letter with your response that keys your
responses to our comments and provides any requested supplemental
information. Detailed cover letters greatly facilitate our
review.
Please file
your cover letter on EDGAR. Please understand that we may have
additional comments after reviewing your responses to our
comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require.
Since the company and its management are in possession of all
facts
relating to a company`s disclosure, they are responsible for the
accuracy and adequacy of the disclosures they have made.
In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that
* the company is responsible for the adequacy and accuracy of the
disclosure in the filings;
* staff comments or changes to disclosure in response to staff
comments in the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the filing; and
* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.
You may contact Patrick Enunwaonye, Staff Accountant, at
(202)
824-5529 or me, at (202) 824-5264 if you have questions regarding
comments on the financial statements and related matters. In this
regard, do not hesitate to contact Brian Cascio, Accounting
Branch
Chief , at (202) 942-1791 with any other concerns.
Sincerely,
Lynn Dicker
Review Accountant
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Mr. Shields
Anadigics, Inc.
April 22, 2005
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