Mail Stop 4561
August 10, 2005
Mr. Herve Caen
Interim Chief Executive Officer
Interplay Entertainment Corp.
1682 Langley Avenue
Irvine, California 92606
Re: Interplay Entertainment Corp.
Form 10-K for the Fiscal Year Ended December 31, 2005
Form 10-Q for the Fiscal Quarter Ended March 31, 2005
File No. 000-27338
Dear Mr. Caen:
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 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
Item 9A. Controls and Procedures, page 38
1. We note that your Chief Executive Officer and interim Chief
Financial Officer concluded that the company`s disclosure controls
and procedures "were of limited effectiveness." Based on this
disclosure, it remains unclear whether your Chief Executive
Officer
and interim Chief Financial Officer concluded that your disclosure
controls and procedures are effective as of December 31, 2004.
Please revise your disclosure to state, in clear and unqualified
language, the conclusions reached by your Chief Executive Officer
and
interim Chief Financial Officer on the effectiveness of your
disclosure controls and procedures. For example, if true, you can
state that your disclosure controls and procedures are effective
including consideration of the identified matters, so long as you
provide appropriate disclosure explaining how the disclosure
controls
and procedures were determined to be effective in light of the
identified matters. Or, if true, you can state that given the
identified matters, your disclosure controls and procedures are
not
effective.
2. We note from your Form 8-K filed March 15, 2005 that in a
letter
received February 28, 2005 your former accountants, Squar Milner,
noted a material weakness in the Company`s internal control over
financial reporting related to the lack of sufficient accounting
department personnel. Please revise to disclose how management
considered this material weakness in its assessment of the
effectiveness of disclosure controls and procedures as of December
31, 2004 and March 31, 2005. Also disclose in greater detail the
specific steps the company has taken to remediate the material
weakness.
3. We note that your disclosure controls and procedures were of
limited effectiveness, at the reasonable assurance level, "in
timely
alerting him to material information required to be included in
this
report" in this filing and on page 23 of your Form 10-Q for the
quarterly period ended March 31, 2005. Revise to clarify, if
true,
that your officers concluded that your disclosure controls and
procedures are also effective in ensuring that information
required
to be disclosed is recorded, processed, summarized and reported
within the time periods specified in the Commissions rules and
forms.
We refer you to Exchange Act Rule 13a-15(e).
4. We note your statement in the last paragraph of this section
that
"there can be no absolute assurance that any design will succeed
in
achieving its stated goals under all potential future conditions"
in
this filing and on page 23 of your Form 10-Q for the quarterly
period
ended March 31, 2005. Please revise to state clearly, if true,
that
your disclosure controls and procedures are designed to provide
reasonable assurance of achieving their objectives. Please refer
to
Section II.F.4 of Management`s Reports on Internal Controls Over
Financial Reporting and Certification of Disclosure in Exchange
Act
Periodic Reports, SEC Release No. 33-8238.
*****
Please respond to this comment within 10 business days or
tell
us when you will provide us with a response. Please submit all
correspondence on EDGAR as required by Rule 101 of Regulation S-T.
Please understand that we may have additional comments after
reviewing 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 comment, 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 Christopher White, Staff Accountant, at (202)
551-3461, Melissa Walsh, at (202) 551-3224 or me at (202) 551-3488
if
you have any questions regarding our comment on the financial
statements and related matters.
Sincerely,
Stephen Krikorian
Accounting Branch Chief
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Mr. Herve Caen
Interplay Entertainment Corp.
August 10, 2005
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