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CORRESP
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March 17, 2005

VIA FACSIMILE and EDGAR

Mr. Thomas A. Jones

Ms. Mary Beth Breslin

Division of Corporation Finance

Securities and Exchange Commission

450 Fifth Street, N.W.

Washington, D.C.  20549

Re:          Ault Incorporated  (File No. 0-12611)

                Annual Report on Form 10-K for the year ended May 30,
2004

                Filed August 25, 2004

Dear Mr. Jones and Ms. Breslin:

                This letter is
submitted on behalf of Ault Incorporated in response to your letter dated
January 14, 2005.  The responses are
numbered in response to your comments.

Form
10-K for year ended May 30, 2004

Item 1.  Business — Page 2

1.     In
future filings, please include a discussion of your practices relating to
working capital items pursuant to Item 10l(c)(1)(vi) of Regulation S-K.  We note your disclosure on page 10 that you
carry an increased level of inventory of certain items.

RESPONSE:

                The Company will include in its future filings a
discussion of its practices related to working capital pursuant to Item
101(c)(1)(vi) of Regulation S-K and increases in inventory.

2.     We
note you have significant manufacturing operations located abroad, particularly
in China and South Korea.  Please expand
your discussion in future filings to describe more fully the impact of foreign
regulation on your business.  Also expand
your discussion of the risks involved with operating internationally.

7105 Northland Terrace Minneapolis, MN 55428-1028
USA Tel:763.592.1900
FAX:763.592.1911 WEB:www.aultinc.com

RESPONSE:

                The Company will discuss the impact of foreign
regulation on the Company’s business, and the risks of operating
internationally in future filings.

Manufacturing
and Sources of Supply — Page 8

3.     In
future filings, please describe the material terms of the arrangements with
your subcontractors, such as their scope, duration and termination
provisions.  Also discuss the importance
of these agreements to your business, including the extent to which your
business depends on such agreements.

RESPONSE:

                In future filings, the Company will describe the material
terms of arrangements with the Company’s subcontractors including disclosure of
the scope, duration and termination provisions of such arrangements.  Future filings will also discuss the
importance and the extent of the Company’s dependence on these arrangements to
the Company’s business.

Item 7.  Management’s Discussion & Analysis of
Financial Condition…— Page 14

        Liquidity and Capital Resources —
Page 15

4.     We
note your disclosure on page 15 that you “took steps to reduce expenses,
improve cash flow and return to profitability,” including the consolidation of
manufacturing operations, and that you attributed part of your increase in
gross margin in fiscal 2004 to cost reductions related to the
consolidation.  In future filings, please
expand to describe more specifically management’s expense reduction efforts
beyond the consolidation, and quantify the known savings that have resulted
from these other efforts for each period for which financial statements are
presented.  Also indicate whether any charge
was taken in connection with any of these activities.

RESPONSE:

                The Company will expand its disclosure in future
filings to describe management’s expense reduction efforts beyond consolidation
and will quantify known savings that have resulted from these efforts in
applicable financial periods, and discuss whether any charges were taken.

5.     We
note your statement that management believes your available cash, borrowings
and amounts generated from operations will be sufficient to meet your cash requirements
for

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                the next twelve months.  In future filings, please discuss your
liquidity on a long-term basis as well. See         instruction
5 to paragraph 303(a) of Regulation S-K.

RESPONSE:

                In future filings the Company will discuss liquidity
on a long-term and short-term basis.

6.     We
note your disclosure that your credit facility with Wells Fargo contains
financial covenants requiring you to maintain a minimum capital base and
imposing limitations on capital expenditures and payment of dividends.  In future filings, quantify the thresholds
that you must maintain.  Also ensure that
your liquidity and capital resources discussion includes a brief description of
all material terms of the
agreement, such as the fact that the availability of the line of credit is
based on your outstanding receivables.
Clarify which assets secure the facility, or if all assets secure the
facility, so state.  Finally, please file
the agreement as an exhibit.

RESPONSE:

                The Company’s future filings will provide more disclosure
concerning the Company’s credit facility with Wells Fargo.  The Company will describe quantitatively the
threshold financial covenants that the Company must maintain.  The Company’s future filings will also
describe the material terms of the credit facility including the fact that the
line is based on outstanding receivables.
The Company will also disclose the assets that secure the facility and
include the agreement as an exhibit.

7.     Additionally,
supplementally and in future filings, discuss what would happen if you were
unable to obtain a waiver or amendment from your lender on reasonable terms?
What kind of interest rate increases could be imposed?

RESPONSE:

If the Company were unable to obtain a waiver or amendment
from the lender on its credit facility on reasonable terms, the credit facility
could be accelerated and the entire balance could be due.  The default interest rate would rise to prime
plus 5%.  Availability under the facility
is based on the Company’s accounts receivables.
Historically, the balance has fluctuated between $2.3 and $2.6
million.  If the balance were accelerated
and the interest rate rose to the default rate, the Company would be required
to secure an alternative credit facility or capital.  There can be no assurance that a replacement
for the revolving credit facility could be obtained at all, or on terms
favorable to the Company.  A failure to
obtain a replacement facility would have a material adverse effect on the
Company.  The Company’s future filings
will include this discussion.

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8.     We
note your disclosure that in July 2004, you obtained a waiver and amended the
credit facility since you did not meet the net book worth and income before
taxes thresholds set forth in the credit agreement.  If in the future there is a material risk of
triggering terms of your indebtedness that result in making a credit facility
unavailable or accelerating a balance due:

•       Discuss
with greater specificity how near you are to violating each such term.

•       Quantify
wherever possible.

•       Quantify
the amount that will be accelerated.

                RESPONSE:

                In future filings if there is a material risk of
triggering terms the credit facility or accelerating the balance due, the
Company will discuss with specificity the violation of any such terms and
quantify the amount accelerated.

9.     In
future filings expand to describe the reasons for the increases and
decreases in the various components of working capital cited as impacting cash
flow from operations.  In general, when
you describe the effects of changes in working capital on cash flow from
operations, the reasons for these changes should also be described.

RESPONSE:

                The Company’s future filings will describe the
reasons for increases and decreases in components of working capital that affect
cash flow from operations.

Results of Operation —
Page 16

10.   Please
note that in future filings, you should include detailed disclosures regarding
the expected effects of your exit plans on future earnings and cash flows, and
actual savings achieved in later periods should be quantified and described.
Significant variances between anticipated impact actual savings should be disclosed
and the reasons for (and anticipated impact of) these variances discussed.  Please revise future filings accordingly.

RESPONSE:

                In future filings, the Company will provide more
detailed disclosures concerning the effects of exit plans on future earnings
and cash flows and will quantify savings achieved, and discuss variances
between expected and actual savings and the reasons for such variances.

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11.   Due
to the significance of the exit charges of $2.1 million in fiscal 2004, we
would expect a significantly more detailed discussion of the nature, timing and
measurement of and reasons for the charges.
Please provide this information in future filings.

RESPONSE:

                The Company will provide a more detailed discussion
of the nature, timing, measurement and reason for the $2.1 million exit
charges.

12.   Supplementally
tell us more about the $1.2 million of additional bad debt expense recorded in
fiscal year 2002.  Did this relate to a
particular customer or product?  Please
advise and revise future filings to clarify.

RESPONSE:

In
fiscal year 2002, the Company recorded $1.2 million additional bad debt
expense.  This related to three customers
that filed chapter 11 that year.  Two of
the three customers were contract manufacturers in the telecommunications
industry.  In 2001 and 2002, that industry
experienced a significant downturn in business causing these customers to file
for Chapter 11. The third customer also filed Chapter 11.  This customer was a videogame card
manufacturer.  This industry also was
subject to extreme distress along with other players in the technology
field.  The Company had done business
with each of these customers for several years.
The Company had no relationship or affiliation with these customers
other than a standard customer arrangement, and the Company did not provide any
preferential terms to these customers prior to their default on obligations to
the Company.

Item 8.  Financial Statements and Supplemental Data —
Page 21

Consolidated Balance
Sheets — Page 26

13.   In
future filings please present the liquidation preferences of the convertible
preferred stock on the face of the balance sheet and include a description in
the footnotes in accordance with paragraphs 6 and 7 of SFAS 129.

RESPONSE:

                In future filings, the liquidation preferences of the
Company’s convertible preferred stock will be shown on the face of the balance
sheet, and the notes will include a description in accordance with paragraphs 6
and 7 of SFAS 129.

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14.   We
note the classification of your redeemable convertible preferred stock in the
mezzanine section.  Please tell why the
classification is appropriate.  Refer to
EITF D-98 and SFAS 150 in your response.

RESPONSE:

The
Company believes that the redeemable convertible preferred stock is properly
classified in the mezzanine section of the balance sheet.  The preferred stock can be converted into a
fixed number of common shares at the option of the holder.  This makes the preferred stock conditionally
redeemable and as such outside the scope of SFAS 150.  However, when the conversion option expires,
the shares would become mandatorily redeemable and would be reclassified as a
liability per SFAS 150.  The Company has
made the determination using the guidance of EITF D-98 to classify the
preferred stock in the mezzanine section.
According to the guidance, the preferred stock does not fit the
classification of liability or permanent equity.

Note 1.  Nature of Business, Liquidity, and
Significant Accounting Policies _- Page 30

Goodwill — Page 31

15.   We
note that you recorded an impairment charge for goodwill in the fourth quarter
of fiscal year 2003.  Please revise the
notes to your financial statements in future filings as follows:

(a)
          Describe in more detail, the
facts and circumstances leading to the goodwill impairment.

RESPONSE:

The
Company’s future filings will include disclosure in the financial notes on the
facts and circumstances leading to the goodwill impairment charge.  This disclosure will also be included in the
financial footnotes.

(b)           Disclose in more detail the
method and significant assumptions used to determine the fair value under SFAS
142.

RESPONSE:

The
Company’s future filings will include disclosure in the financial notes on the
method and significant assumptions used to determine fair value under SFAS 142.

(c)           Disclose to explain why the charge
was recorded in the fourth quarter and not an earlier period. Refer to
paragraph 28 of SFAS 142 in your response.

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RESPONSE:

The
Company’s future filings will include disclosure in the financial notes why the
charge was recorded in the fourth quarter and will refer to paragraph 28 of
SFAS 142.

(d)           When an impairment charge is
significant, you should provide more detailed information about the nature,
timing, and measurement of and reasons for the impairment charge. You should
similarly revise your discussion in MD&A to provide more detailed
information.

RESPONSE:

The
Company’s future filings will provide more detailed information about the
nature, timing, measurement and reasons for any significant impairment
charge.  The Company’s MD&A will add
additional disclosure discussing the impairment charge.

Please
also supplementally provide this information. See paragraphs 46 and 47 of SFAS
142.

RESPONSE:

                    On December 1, 1998 the Company purchased certain operating assets of the power supply division of LZR Electronics, Inc., a closely held firm based in Gaithersburg, Maryland (“LZR”).  LZR had no affiliation to the Company or any of its affiliates at the time of the acquisition.  The assets purchased included inventory, fixed assets, contract and intellectual property rights and other operating assets.  The Company paid an aggregate purchase price of $3,660,879 consisting of a cash payment of $2,580,879, delivery of a one year 8.0% convertible promissory note for $500,000 and an assumption of approximately $580,000 of certain liabilities.  The convertible promissory note was converted at the option of the holder into 78,865 shares of the Company common stock.   The Company registered the resale of these shares on Form S-3.  (File No. 333-68959).  LZR’s revenues relating to its power supply division for its calendar year 1997 were approximately $6,400,000 and its estimated revenues for calendar year 1998 were $6,500,000.

                    During the fourth quarter of fiscal 2003, the Company performed its annual goodwill impairment test to determine the fair value of the assets of LZR and to determine if the goodwill carried on the Company’s financial statements was impaired, and if so the extent of such impairment.  In the fourth quarter of 2003, it became apparent that LZR’s product line was not selling as forecasted, and a significant increase in fourth quarter loss would be incurred.  The goodwill impairment analysis was done as a result of the decline in revenues for the fourth quarter compared to forecasted revenues, as well as a significant increase in the fourth quarter loss compared to forecast.  The Company did not perform an impairment test prior to the fourth quarter, as there was not an event that had occurred or circumstances had changed in such a manner to warrant an impairment test prior to the fourth quarter.  The Company recorded an

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impairment charge of $1,153,153 in the fourth quarter of fiscal 2003.  This amount reflected the remaining goodwill from the 1998 acquisition.  The goodwill was recorded as an operating expense under the heading of goodwill impairment.

Stock Compensation —
Page 33

16.   Revise
future filings to provide all disclosures specified in paragraph 2(e)(c) of
SFAS 148.  Specifically, revise the table
to include the stock-based employee compensation cost,