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(REYNOLDS AND REYNOLDS LOGO)

August 5, 2005

Craig Wilson
Senior Assistant Chief Accountant
U.S. Securities and Exchange Commission
Division of Corporation Finance
100 F Street Northeast
Washington, D.C. 20549

Re:   The Reynolds and Reynolds Company
      Form 10-K for the Fiscal Year Ended September 30, 2004
      Form 10-Q for the Fiscal Quarter Ended December 31, 2004
      Form 10-Q for the Fiscal Quarter Ended March 31, 2005
      File No. 001-10147

Dear Mr. Wilson,

The following comments are in response to the staff's comment letter dated June
30, 2005. For convenience of reference, our responses are organized using the
same headings and numbered captions as your letter.

Annual Report on Form 10-K for the Year Ended September 30, 2004

Note 1.  Summary of Significant Accounting Policies

Revenue Recognition, page 40

Prior Comment number 4

1.    Comment

      We note you have concluded that based on the criteria of EITF 03-05,
      software is not essential to the functionality of hardware installation
      services and therefore, the hardware installation services are not
      considered software-related and are excluded from the scope of SOP 97-2.
      Further, you have concluded that since you do not meet the criteria in
      paragraph 9 of EITF 00-21 to account for your hardware installation
      services as a separate unit of accounting, you combine the hardware
      installation services with the software and software training services and
      account for the combined unit of accounting as a SOP 97-2 deliverable.

P.O. Box 1824
Dayton, Ohio 45401
937.485.2000                           1
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      If our understanding is correct, tell us why you have determined that SOP
      97-2 is the appropriate revenue recognition principle to apply to the
      combined unit of accounting since the hardware installation services do
      not fall within the scope of SOP 97-2. Tell us your consideration for
      recognizing the combined unit of accounting pursuant to SAB Topic 13.

      Management's Response

      The company did review EITF 03-5 and determine that software is not
      essential to the functionality of hardware or hardware installation
      services. The company also does not have vendor specific objective
      evidence (VSOE) of fair value for software licenses, software training
      services and hardware installation services and can not account for each
      of these items as separate units of accounting according to paragraph 9 of
      EITF 00-21. Therefore software licenses, software training services and
      hardware installation services must be accounted for as one unit of
      accounting. There is no specific accounting guidance that addresses the
      recognition of revenue related to a combined unit of accounting consisting
      of deliverables that are subject to different authoritative literature. In
      this situation the hardware installation services would be subject to the
      guidance in SAB Topic 13 while the software license and software training
      would be subject to SOP 97-2. The company reviewed SAB Topic 13 which
      states, if a transaction is within the scope of specific authoritative
      literature that provides revenue recognition guidance, that literature
      should be applied. Because the key elements of the combined unit of
      accounting in question are software and software training, the company
      applied the provisions of SOP 97-2 rather than the provisions of SAB Topic
      13. The hardware installation effort is relatively insignificant in
      comparison to the software training effort. Further, customers value the
      software and related software training more so than hardware installation.
      Because the only undelivered element of the combined unit of accounting is
      services, software revenue and services revenues are recognized as the
      services are performed according to paragraph 12 of SOP 97-2, which
      states, in part:

            If the only undelivered element is services that do not involve
            significant production, modification, or customization of software
            (for example training or installation), the entire fee should be
            recognized over the period during which the services are expected to
            be performed. [Emphasis added.]

Prior Comment number 5

2.    Comment

      Your response states that your leases are classified as direct financing.
      We note your revised revenue recognition disclosure provided in Appendix A
      to your response which states, "the accounting for these direct financing
      leases is governed by SFAS 13, which requires hardware revenue equal to
      the fair value of the hardware to be recognized as revenue upon shipment
      to customers." Further, we note per your Business Segment disclosure in
      Note 8 to your Form 10-Q for the quarter ended March 31, 2005 that you
      have recognized revenue from hardware product sales. Tell us the amount of
      revenue recognized based on hardware shipped in your direct financing
      lease transactions for the years ended September 30, 2004, 2003 and 2002
      and the six months ended March 31, 2005. Clarify how your policy for
      recording revenue for hardware in a direct financing lease arrangement
      complies with paragraph 18 of SFAS 13.

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      Management's Response

      The company's leases are classified as direct financing leases for
      separate reporting of its wholly-owned financing subsidiary. On a
      consolidated basis, these same leases are classified as sales-type leases.
      In its prior response, the company stated incorrectly that its leases were
      not sales-type leases. We apologize for any confusion resulting from this
      response.

      The company is a dealer in computer hardware. Paragraph 6.b.i of SFAS 13
      states in part, sales-type leases will arise when manufacturers or dealers
      use leasing as a means of marketing their products. The company does use
      leasing as a means to market its computer systems. The company also
      generates profits on its software arrangements, which include hardware.
      Hardware selling prices to customers also exceed the company's cost to
      purchase the hardware from its vendors (i.e. fair value of the leased
      property at the inception of the lease is greater than cost or carrying
      amount). Hardware selling prices may vary from customer to customer.
      Paragraph 5.c.i states in part, when the lessor is a dealer, the fair
      value of the property at the inception of the lease will ordinarily be its
      normal selling price. However, as stated previously, the company does not
      have VSOE of fair value of each element (hardware, software, hardware
      installation, software training) of its software arrangements. Because the
      selling price of the hardware does not represent VSOE of fair value, the
      company does not believe it is appropriate to use this price as fair value
      in recording hardware sales. However, because the hardware is leased under
      a sales-type lease it is appropriate to record revenue at the time of
      hardware delivery. Therefore, the company chose to only recognize hardware
      revenue to the extent of cost at the time of delivery. The balance of the
      hardware revenue is recorded over the implementation period along with the
      other elements, which are accounted for under SOP 97-2. The company
      determined that using fair value equal to cost in recording its hardware
      revenues had the following benefits:

            -     Revenue recognition could not be accelerated by arbitrarily
                  allocating more of the selling price to hardware and less to
                  the other elements.

            -     As a result, revenue would be recognized in the same amount
                  for each hardware sale.

            -     Revenue and profit recognition would be conservative because
                  the profit from the hardware sales (hardware selling price
                  minus cost) would be recognized over the implementation period
                  (typically 90 days) with the other elements of the software
                  arrangement and not upon delivery of the hardware.

            -     Profit recognition would be consistent for all other elements
                  included in the arrangement which are accounted for under SOP
                  97-2

      The company does publicly disclose the total amount of hardware revenues.
      The company is unable to provide the amount of hardware revenues related
      to its leases for the periods requested. This information is available at
      the inception of the lease, however, once the lease is recorded by the
      company's wholly-owned financing subsidiary, the information is no longer
      tracked separately. The company records all hardware revenues to the same
      account and internal financial statement page. Because the company records
      all hardware sales, whether subject to a lease or not, in the same general
      ledger account, the company is unable to readily distinguish hardware
      sales subject to leases from other hardware sales.

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      As noted above, the company's leases are classified as sales-type leases
      on a consolidated basis. Accordingly, these leases are subject to
      paragraph 17 of SFAS 13, not paragraph 18. The company complies with
      paragraph 17 of SFAS 13 in recording its lease transactions, as follows:

            -     The company determines the gross investment by adding the sum
                  of the minimum lease payments, net of executory costs, and the
                  unguaranteed residual value estimated at the inception of the
                  lease.

            -     The difference between the gross investment and present value
                  of the minimum lease payments and the present value of the
                  unguaranteed residual value of the leased property is recorded
                  as unearned income.

            -     As stated above, upon delivery, the company records as revenue
                  an amount equal to the cost of the hardware. Such amount is
                  less than the present value of the minimum lease payments.

            -     The carrying amount of the leased property is charged against
                  income in the same period as revenue is recognized.

            -     The company's estimated residual values are reviewed annually.

            -     The company's leases do not contain a residual guarantee or
                  penalty for failure to renew the lease at the end of the lease
                  term.

3.    Comment

      We note you have included leasing activity disclosures in your Financial
      Services footnote, Note 6. Explain how you have considered the
      significance of your direct financing leasing activity to determine
      whether this activity should be disclosed separately from other financing
      activity; see SFAS 13, paragraph 23. If you determine that your direct
      financing lease activity is significant, tell us how you plan to comply
      with the disclosure requirements of paragraph 23 of SFAS 13.

      Management's Response

      The company is unable to provide disclosures of hardware leases separately
      from other financing activities. As noted above, this information is
      available at the inception of the lease, however, once the lease is
      recorded by the company's wholly-owned financing subsidiary, the
      information is no longer tracked separately. The company prepares one
      lease document with its customers. This document includes the amounts
      invoiced for computer hardware equipment, hardware installation services,
      software licenses and software training services. One amount is recorded
      in the leasing sub ledger. The customer makes one payment each month and
      the company applies this payment to the one outstanding receivable
      balance. The company does not have separate receivable balances for each
      of hardware, installation, software and training. The company is
      disclosing all items required by paragraph 23 of SFAS 13 consistent with
      how management operates the business.

            -     The company discloses the amounts of minimum lease payments
                  (product financing receivables), allowance for doubtful
                  accounts, unguaranteed residual values, initial direct costs
                  (under the caption "other") and unearned interest income.

            -     The company discloses the future minimum lease payments
                  (product financing receivables) to be received for each of the
                  five succeeding years as of the latest balance sheet date.

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            -     The company's financing arrangements do not include contingent
                  rentals.

      The company believes that its disclosures are in compliance with generally
      accepted accounting principles, informative to investors and consistent
      with how management operates the business.

Prior Comment number 5

4.    Comment

      We note you referenced the second bullet of paragraph 12 of SOP 97-2 to
      support your revenue recognition policy for software license, hardware
      installation and software training. Clarify why you exclude PCS when
      recognizing the entire arrangement fee over the period during which the
      services are expected to be performed. Tell us how you considered
      recognizing the arrangement fee over the longer of the expected hardware
      installation and software training or the PCS term.

      Management's Response

      As the company evaluated whether it could account for software training
      and hardware installation services separately, it considered paragraph 65
      of SOP 97-2 which states, in order to account separately for the service
      element of an arrangement that includes both software and services,
      sufficient VSOE of fair value must exist to permit allocation of the
      revenue to the various elements of the arrangement. Additionally, the
      services (a) must not be essential to the functionality of any other
      element of the transaction and (b) must be described in the contract such
      that the total price of the arrangement would be expected to vary as the
      result of the inclusion or exclusion of the services. Because VSOE does
      not exist for software training or hardware installation services, a
      single unit of accounting exits for software licenses and the related
      installation and training services. Revenue is recognized for this
      combined unit of accounting using contract accounting in accordance with
      paragraph 64 of SOP 97-2 which states, if the nature of the services is
      such that the service element does not qualify for separate accounting as
      a service, contract accounting must be applied to both the software and
      service elements included in the arrangement. Therefore, the software
      license fee revenues and the installation and training services revenues
      were combined and recognized as a combined unit of accounting over the
      implementation period. The Company has established VSOE for the PCS
      element of its software arrangements through its renewal rate. In
      accordance with TPA 5100.49, the Company accounts for the PCS services
      separately from the balance of the arrangement to which contract
      accounting is being applied.

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