Mail Stop 4561
July 19, 2005
C. Kyle Ranson
President and Chief Executive Officer
Infocus Corporation
27700B SW Parkway Avenue
Wilsonville, Oregon 97070
Re: Form 10-K for Fiscal Year Ended December 31, 2004
Form 10-Q for Fiscal Quarter Ended March 31, 2005
File No. 000-18908
Dear Mr. Ranson:
We have reviewed the above referenced filings and have the
following comments. Please note that we have limited our review
to
the matters addressed in the comments below. We may ask you to
provide us with supplemental information so we may better
understand
your disclosure. Please be as detailed as necessary in your
explanation. After reviewing this information, we may 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 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 Fiscal Year Ended December 31, 2004
Management`s Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations, page 17
Other Income (Expense), page 22
1. We note that $2.4 million of your income before taxes for 2004
related to your share of the profitability of Motif, your 50/50
joint
venture with Motorola. Explain how you considered the disclosure
requirements of Rule 4-08(g) of Regulation S-X.
2. We note that "Motif license fees are recognized when licensees
report sales and resultant royalties, which are currently only
contractually required on a semi-annual basis." Explain why there
is
a significant time delay for Motif`s licensees to report sales and
resultant royalties. Explain if and whether Motif`s management
has
the ability to estimate the license revenues prior to receiving
the
royalty reports. Refer to SAB Topic 13A (1).
Notes to Consolidated Financial Statements
Note 1. Summary of Significant Accounting Policies, Revenue
Recognition, page F-11
3. We note disclosure on page 17 that revenues in 2004 grew, in
part,
as a result of increased royalty revenues. Please tell us your
revenue recognition policy for your royalty revenues and explain
why
you have not disclosed this policy in your revenue recognition
accounting policy.
Note 7. Income Taxes, page F-19
4. We note your reconciliation between the effective tax rate and
the
statutory federal income tax rate. Explain to us the history and
nature of the reconciling items labeled "Resolution of tax
authority
items" and "Reduction of tax reserves for resolved items."
Additionally, explain how you treated these items, for accounting
purposes, in previous periods and explain why these items impacted
your results for fiscal year 2004 only. Tell us why you did not
provide this information in your MD&A given the material impact
these
items have on your effective tax rate.
Schedule II - Valuation and Qualifying Accounts, page F-29
5. We note your allowance for uncollectible accounts and sales
allowances of $11.8 million and $10.8 million for fiscal years
ending
December 31, 2003 and 2004, respectively. Reconcile these amounts
for each fiscal year to the sum of the allowance for uncollectible
accounts listed on page F-7 and the reserve for sales returns,
price
protection and other rebates on page F-11. Furthermore, tell us
about the contributing factors that led to the $4.8 million (55%)
decline in your allowance for uncollectible accounts between
fiscal
year 2003 and 2004, as disclosed at the tope of page F-7.
Please respond to these comments within 10 business days or
tell us when you will provide us with a response. Please submit
all
correspondence and supplemental materials on EDGAR as required by
Rule 101 of Regulation S-T. You may wish to provide us with
marked
copies of any amendment to expedite our review. Please furnish a
cover letter with any amendment that keys your response to our
comments and provides any requested information. Detailed cover
letters greatly facilitate our review. Please understand that we
may
have additional comments after reviewing any amendment and your
response to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing includes all information required under the Securities
Exchange Act of 1934 and that they have provided all information
investors require for an informed investment 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 Jason Niethamer at 202-551-3855, Lisa
Mitrovich
(Assistant Chief Accountant) at 202-551-3453 or me at 202-551-3730
if
you have questions regarding the above comments.
Sincerely,
Stephen G. Krikorian
Accounting Branch Chief
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C. Kyle Ranson
Infocus Corporation
July 19, 2005
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