Mail Stop 4-7
March 31, 2005
Malcolm C. Persen
Chief Financial Officer
Radyne ComStream Inc.
3138 East Elwood Street
Phoenix, AZ 85034
Re: Radyne ComStream Inc.
Form 10-K for the fiscal year ended Dec. 31, 2004, filed March 16,
2005
File No. 0-11685
Dear Mr. Persen:
We have reviewed the referenced 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. As such, all persons who are responsible for the
adequacy and accuracy of the disclosure are urged to be certain
that
they have included all information required pursuant to the
Securities Exchange Act of 1934. Please amend your filing in
response to comment 5 below. Please address all remaining
comments
in future filings. If you disagree with any of these comments, 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
filings.
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-K for the fiscal year ended December 31, 2004, filed March
16, 2005
Item 8. Financial Statements, page 25
Consolidated Statements of Operations, page 28
1. We note that you derive revenue from the sale of products and
services. If revenue derived from services exceeds 10% of total
net
sales, revise to present revenue from the sale of products and
services separately on the face of your income statement,
consistent
with the requirements of Rule 5-03.1 of Regulation S-X. When
revenue
is presented separately, the related costs of sales for each type
of
revenue also should be presented separately on the face of the
income
statement.
Item 9A - Controls and Procedures, page 43
2. We note your disclosure that "our Chief Executive Officer and
Chief Financial Officer have concluded that our disclosure
controls
and procedures ... were sufficiently effective." Please confirm
that
your disclosure controls and procedures were effective as of the
end
of the period covered by this report and revise your future
filings
to remove this qualification. You must clearly state whether the
officers concluded that the company`s disclosure controls and
procedures were effective.
In future filings, if you indicate that your disclosure controls
and
procedures are designed to provide "reasonable assurance" of
achieving their objectives, then you should evaluate whether the
controls and procedures are, in fact, effective at the "reasonable
assurance" level. Alternatively, you may simply state, if true,
that
your Chief Executive Officer and Chief Financial Officer concluded
that your disclosure controls and procedures are effective. In
this
regard, please see Section II.F.4 of Securities Act Release No.
33-
8238 (June 5, 2003), which is available on our web site at
http://www.sec.gov/rules/final/33-8238.htm.
3. We note your disclosure that "our disclosure controls and
procedures ... were sufficiently effective to ensure that the
information required to be disclosed by us in this Annual Report
on
Form 10-K was recorded, processed, summarized and reported within
the
time periods specified in the SEC`s rules and instructions for
Form
10-K." Please confirm, if true, that your disclosure controls and
procedures are also designed to ensure that information required
to
be disclosed in the reports that you file or submit under the
Exchange Act is accumulated and communicated to your management,
including your principal executive and principal financial
officers,
to allow timely decisions regarding required disclosure. See Rule
13a-15(e) of the Securities Exchange Act. Please also comply with
this comment in future filings. Alternatively, in future filings,
you may simply state, if true, that your Chief Executive Officer
and
Chief Financial Officer concluded that your disclosure controls
and
procedures are effective.
4. We note your disclosure that "[t]here were no significant
changes
in our internal controls over financial reporting during our most
recently completed quarter that have materially affected, or are
reasonably likely to materially affect, our internal control over
financial reporting, or there factors that could significantly
affect
these controls subsequent to the date of their evaluation."
Please
confirm, if true, that there were no changes in your internal
control
over financial reporting that occurred during your last fiscal
quarter that have materially affected, or are reasonably likely to
materially affect, your internal control over financial reporting.
See Item 308(c) of Regulation S-K, which became effective on
August
14, 2003. Further, in future filings, please comply with Item
308(c)
of Regulation S-K. See also Section II.J. of Securities Act
Release
No. 33-8238 (June 5, 2003), which is available on our web site at
http://www.sec.gov/rules/final/33-8238.htm#iij.
Signatures, page 49
5. The Form 10-K must be signed by your principal accounting
officer.
If an individual who has already signed the Form 10-K acts in this
capacity, please revise to indicate each capacity in which that
individual signs the document. See Instruction D(2) to Form 10-K.
In response to this comment, you should file an amended Form 10-K
that includes: the cover page; Part IV, revised to reflect the
new
certifications that will be required as Exhibits 31.1 and 31.2;
and a
revised signature page. The amendment should also include new
Exhibits 31.1 and 31.2.
* * * * *
As appropriate, please amend your periodic report and
respond
to these comments within 10 business days or tell us when you will
provide us with a response. You may wish to provide us with
marked
copies of the amendment to expedite our review. Please furnish a
cover letter with your amendment that keys your responses to our
comments and provides any requested supplemental information.
Detailed cover letters greatly facilitate our review. Please
submit
your cover letter as correspondence on EDGAR. Please understand
that
we may have additional comments after reviewing your amendment and
responses to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision. 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 filing;
* staff comments or changes to disclosure in response to staff
comments 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 Christine Bashaw, Staff Accountant, at (202)
824-5422 if you have questions regarding comments on the financial
statements and related matters. Please contact Daniel Zimmerman,
Staff Attorney, at (202) 942-1933 or me at (202) 942-1990 with any
other questions.
Sincerely,
Larry Spirgel
Assistant Director