SEC Company Response from UTAH MEDICAL PRODUCTS INC (UTMD) (CIK 0000706698) (UTMD) — Jul 19, 2005
UTAH MEDICAL PRODUCTS INC (UTMD) (CIK 0000706698)
Date: July 19, 2005 · CIK: 0000706698 · Accession: 0001096906-05-000379
AI Filing Summary & Sentiment
File numbers found in text: 001-12575
Referenced dates: June 15, 2005
Letter
Division of Corporation Finance VIA EDGAR Re: Utah Medical Products, Inc. File No. 001-12575 Confidential Treatment Request - Correspondence dated July 19, 2005
Dear Ms. Tillan:
UTMD respectfully requests that the portion identified below of our response to SEC comments dated June 15, 2005 be afforded confidential treatment under SEC Rule 83 (17 CFR 200.83). We request that the redacted portions of our response not be disclosed publicly, including in response to a request under the Freedom of Information Act.
We have prepared the attached correspondence in compliance with rules relating to confidential treatment requests. The portion redacted is:
o
UTMD’s response to Item 6, starting on line 103 of page UTSD 0003.
We are separately mailing to your attention an un-redacted hard copy of our response, highlighting the portions that have been redacted.
We appreciate your help in this important matter. Please contact me at 801-569-4015 if you are not able to comply with this request for any reason, or if you have questions.
Sincerely,
/s/
Greg
A. LeClaire
Show Raw Text
CORRESP
1
filename1.htm
Utah Medical Products Correspondence July 19, 2005
July
19,
2005
Kate
Tillan
Assistant
Chief Accountant/ Mail Stop 03-06
Division
of Corporation Finance
U.S.
Securities and Exchange Commission
Washington,
D.C. 20549-0306
VIA
EDGAR
Re:
Utah
Medical Products, Inc.
File
No.
001-12575
Confidential
Treatment Request - Correspondence dated July 19, 2005
Dear
Ms.
Tillan:
UTMD
respectfully requests that the portion identified below of our response to
SEC
comments dated June 15, 2005 be afforded confidential treatment under SEC Rule
83 (17 CFR 200.83). We request that the redacted portions of our response not
be
disclosed publicly, including in response to a request under the Freedom of
Information Act.
We
have
prepared the attached correspondence in compliance with rules relating to
confidential treatment requests. The portion redacted is:
o
UTMD’s
response to
Item 6, starting on line 103 of page UTSD
0003.
We
are
separately mailing to your attention an un-redacted hard copy of our response,
highlighting the portions that have been redacted.
We
appreciate your help in this important matter. Please contact me at 801-569-4015
if you are not able to comply with this request for any reason, or if you have
questions.
Sincerely,
/s/
Greg
A. LeClaire
Greg
A.
LeClaire
CFO
UTSD
0001
Confidential
Treatment Requested by Greg A. LeClaire
1
2
3
July
19, 2005
4
5
Kate
Tillan
6
Assistant Chief Accountant/ Mail Stop 6010
7
Division of Corporation Finance
8
U.S.
Securities and Exchange Commission
9
Washington, D.C. 20549-6010
10
11 VIA
EDGAR
12
13 Re:
Utah
Medical Products, Inc.
14 Form
10-K for
the fiscal year ended December 31, 2004
15 Filed
March
16, 2005
16 Form
10-Q for
the Fiscal Quarter Ended March 31, 2005
17 Forms
8-K
dated April 19, 2005, April 20, 2005 and May 6, 2005
18 File
No.
001-12575
19
20 Dear
Ms.
Tillan:
21 This
letter
is UTMD’s detailed response to SEC comments dated June 15, 2005, which will also
be filed on
22 EDGAR
as
private correspondence with the SEC. For ease of reference in the following,
I
have incorporated
23 the
June 15,
2005 comments in italics followed by UTMD’s responses.
24 Draft
Form
10-K/A for the Fiscal Year Ended December 31, 2004
25 Item
7.
Management’s Discussion and Analysis of Financial Condition and Results of
Operations, page 17
26 Critical
Accounting Policies and Estimates, page 23
27 1.
28
29
Please
refer to prior comment 7. We note that your critical accounting
policies
include an inventory
valuation
reserve. Please tell us and revise your filing to discuss the following
information related
to
this policy:
30
·
Include
information regarding how you arrive at these
estimates;
31
·
Discuss
how accurate the estimates or assumptions have been in the
past;
32
·
Discuss
whether the estimates or assumptions are reasonably likely to change
in
the future
33 UTMD
Response to Item 1.:
34 Please
refer
to the first sentence of the last paragraph on page 23 of the Draft 10-K/A
which
states how UTMD
35 arrived
at
its estimates; “Management bases its estimates and judgments on historical
experience, current
36 economic
and
industry conditions and on various other factors that are believed to be
reasonable under the
37 circumstances.”
UTMD
has also added the following disclosure to its Draft 10-K/A, “The
Company believes
38 its
method of
reviewing actual and projected demand for its existing inventory allows it
to
arrive at a fair
39 inventory
valuation reserve.”
40
41
42
43
44
45
·
Since
UTMD’s estimates have been accurate in the past, the following disclosure
has been added to
UTMD’s
Draft 10-K/A “While
the Company has historically not had significant inventory
write-offs,
the
possibility exists that one or more of its products may become
unexpectedly obsolete for which a
reserve
has not previously been created. The
Company’s historical write-offs have not been materially
different
from its estimates.”
46
47
UTSD
0002
Confidential
Treatment Requested by Greg A. LeClaire
48 Item
9A.
Disclosure Controls and Procedures, page 25
49
50
51
52
2.
Please
refer to prior comment 8. The definition of disclosure controls
and
procedures is included in
Rule
13a-15(e) of the Exchange Act. The definition of internal controls
over
financial reporting is
included
in Rule 13-a-15(f) of the Exchange Act. Please revise your filing
to
include the correct
reference
to internal controls over financial reporting and disclosure controls
and
procedures.
53 UTMD
Response to Item 2.:
54 UTMD
has
adjusted its draft 10-K/A to reflect the correct reference.
55
56
57
3.
We
note that you did not include the certifications within this draft
amendment that were previously filed as
Exhibit
16 and 17 in your Form 10-K. Please include these certifications
with your
amended Form 10-K.
58 UTMD
Response to Item 3.:
59 Exhibits
16
and 17 are included in UTMD’s draft 10-K/A but were apparently not received by
you. UTMD will
60 be
sure to
include in its final amended filing.
61
62 Consolidated
Financial Statements, page F-1
63 Consolidated
Balance Sheet, page F-7
64
65
66
67
68
69
70
4.
Please
refer to prior comment 13. Please present the carrying value of
your
goodwill and do not show
the
accumulated amortization related to your goodwill that was previously
recognized prior to the
adoption
of SFAS 142. See paragraph 43 and Appendix C of SFAS 142. Please
also tell
us and disclose
whether
or not you perform a two-step impairment test of goodwill pursuant
to
paragraphs 18-41 of
SFAS
142. We note that your response only addresses paragraphs 23-25
of SFAS
142. Please tell us
and
disclose when you perform your annual testing and revise your footnotes
to
include your
accounting
policy associated with testing
goodwill.
71 UTMD
Response to Item 4.:
72 UTMD
has made
the requested corrections in the draft 10-K/A.
73
74
75
5.
Please
refer to prior comment 11. Please tell us and revise your filing
to
address the following related
to
your revenue recognition
policy:
76
77
·
Describe
how your revenue recognition policy considers whether persuasive
evidence
of an
arrangement
exists and the selling price to the buyer is fixed or
determinable.
78
79
80
81
·
Tell
us the nature and signification terms of the arrangements with
distributors, including any
post
shipment obligations, acceptance provisions and return provisions
that may
exist and
how
you account for such obligations. Please tell us why it is appropriate
to
recognize
revenue
upon shipment rather than resale to the ultimate
customer.
82 UTMD
Response to Item 5.:
83 The
following
has been added to UTMD’s draft 10-K/A: “Revenue recognized by UTMD is based
upon
84 documented
arrangements and fixed contracts in which the selling price is fixed prior
to
completion of an
85 order.”
86 UTMD
recognizes revenue upon shipment to distributors as this is when title of
the
product is transferred.
87 UTMD
does not
sell on consignment basis through distributors. Distributors do not have
at-will
return
88 privileges.
UTMD maintains a relatively small sales return allowance to account for the
possible, yet remote
89 chance,
of
non-resaleable returns.
90
UTSD
0003
Confidential
Treatment Requested by Greg A. LeClaire
91
92
93
94
95
96
97
98
99
100
6.
Please
refer to comment 11(d). We do not agree that a sale with shipping
terms of
FOB Destination is
the
same as a sale for which revenue recognition is appropriate due
to meeting
all of the criteria to
record
revenue based upon a bill and hold basis. For example, for a bill
and hold
sale, you would
continue
to hold the product because the buyer, and not you, requested that
due to
a substantial
business
purpose of the buyer they need to order the goods on a bill and
hold
basis. Please revise your
financial
statements for each period presented to properly consider when
title
transfers in your
recognition
of revenue for transactions where the shipping terms are FOB destination,
or tell us why it
is
appropriate to continue to record these sales upon shipment under
U.S.
GAAP, including SAB Topic
13.
Tell us the amount of revenue recognized in each period including
the
latest interim period upon
shipment
for transactions where the shipping terms are FOB
destination.
101
102 UTMD
Response to Item 6.:
103 [********UTMD’s
response to Item 6 is redacted********]
104
105
106
107
7.
Please
refer to prior comment 11(f). Please revise the notes to the consolidated
financial statements to
include
the amount of revenues from your external customers for each product
and
service or each group of
similar
products and services unless it is impracticable to do so. Refer
to
paragraph 37 of SFAS 131.
108 UTMD
Response to Item 7.:
109 UTMD
has
added “Revenues by Product Category” to its notes in its draft
10-K/A.
110
111 Note
3
Investments, page F-16
112
113
114
115
116
117
8.
Please
refer to prior comment 14. We note your revised disclosure consists
of the
aggregate fair value
of
your securities, classified as available-for-sale as well as the
gross
unrealized gains or losses for
your
equity securities. We also note your revised disclosure consists
of the
contractual maturities
related
to your debt securities. Please tell us and revise your filing
to clarify
the type of securities that
comprise
your investment balance as of December 31, 2003 and 2004. Please
explain
to us why you do
not
have any unrealized gains or losses related to your debt
securities.
118 UTMD
Response to Item 8:
119 UTMD
held
municipal debt securities, and has modified its draft 10-K/A to disclose
as
such. UTMD’s debt
120 securities
are held through equivalent mutual fund brokerage offerings which pay int