Mail Stop 7010
October 18, 2005
Mr. James B. Flaws
Vice Chairman and Chief Financial Officer
Corning, Incorporated
One Riverfront Plaza
Corning, New York 14831
RE: Form 10-K for the Fiscal Year ended December 31, 2004
Forms 10-Q for the Fiscal Quarters ended March 31, 2005 and June
30,
2005
File No. 1-3247
Dear Mr. Flaws:
We have reviewed these filings and have the following
comments. If you disagree with a comment, 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
information so we may better understand your disclosure. 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 year ended December 31, 2004
General
1. Where a comment below requests additional disclosures or other
revisions to be made, please show us in your response what the
revisions will look like. These revisions should be included in
your
future filings, including your interim filings where applicable.
2. Please disclose the types of expenses that you include in the
cost
of sales line item and the types of expenses that you include in
the
selling, general and administrative expenses line item. Please
also
tell us whether you include inbound freight charges, purchasing
and
receiving costs, inspection costs, warehousing costs, internal
transfer costs, and the other costs of your distribution network
in
the cost of sales line item. With the exception of warehousing
costs, if you currently exclude a portion of these costs from cost
of
sales, please disclose:
? in a footnote the line items that these excluded costs are
included in and the amounts included in each line item for each
period presented, and
? in MD&A that your gross profit margins may not be comparable
to
those of other entities, since some entities include all of the
costs
related to their distribution network in cost of sales and others
like you exclude a portion of them from gross profit margin,
including them instead in another line item, such as selling,
general
and administrative expenses.
Liquidity and Capital Resources
Contractual Obligations
3. Please revise the table of contractual obligations to include
estimated interest payments on your debt. Because the table is
aimed
at increasing transparency of cash flow, we believe these payments
should be included in the table. Please also disclose any
assumptions you made to derive these amounts.
Financial Statements
Note 1 - Summary of Significant Accounting Policies
Basis of Presentation and Principles of Consolidation
4. Please provide the disclosures required by paragraphs 23
through
26 of FIN 46(R), including those required for variable interest
entities for which you are the primary beneficiary.
Foreign Currency Translation and Transactions
5. Please tell us the significant changes in economic facts and
circumstances that led you to determine it was appropriate to
change
the functional currency of your Taiwanese subsidiary from the new
Taiwan dollar to the Japanese yen in accordance with paragraph 45
of
SFAS 52.
Property, Net of Accumulated Depreciation
6. Please separately disclose the range of useful lives for each
property category presented. For property categories that still
have
very broad useful lives, you should separately discuss the types
of
assets that fall in each part of the range.
Note 7 - Investments
7. Please tell us more about entities in which your direct
ownership
interest is greater than 50% and you account for using the equity
method. Specifically, please address the following:
* Tell us how you determined it is not appropriate to consolidate
these entities including the accounting literature which led you
to
this conclusion;
* Tell us the investment amounts recorded on your balance sheets
at
December 31, 2004 and June 30, 2005 related to these entities; and
* Tell us the amount of equity in earnings recorded during each of
the three years ended December 31, 2004 and the six months ended
June
30, 2005 related to these entities.
Note 13 - Commitments, Contingencies, Guarantees and Hedging
Activities
8. Please provide all of the disclosures required by paragraph 45
of
SFAS 133. These disclosures should include the following:
* the net gain or loss recognized in earnings from ineffective or
discontinued cash flow hedges and where the net gain or loss is
reported in your statements of operations; and
* the estimated amount of the unrealized gains and losses on cash
flow hedges at year-end that is expected to be reclassified into
earnings within the next twelve months.
Form 10-Q for the quarter ended June 30, 2005
9. Please address the comments above in your interim filings as
well.
* * * *
Please respond to these comments within 10 business
days, or tell us when you will provide us with a response. Please
provide us with a response letter that keys your responses to our
comments and provides any requested information. Detailed letters
greatly facilitate our review. Please file your response on EDGAR
as
a correspondence file. 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 required
under
the Securities Exchange Act of 1934 and 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 their filings;
* 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.
If you have any questions regarding these comments,
please
direct them to Gus Rodriguez, Staff Accountant, at (202) 551-3752
or,
in his absence, Nudrat Salik, Staff Accountant, at (202) 551-3692.
Sincerely,
Rufus Decker
Branch Chief
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James B. Flaws
Corning Incorporated
October 18, 2005
Page 1 of 4
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010
DIVISION OF
CORPORATION FINANCE