SEC Comment Letter for CANDELA — Mar 7, 2005
CANDELA CORP /DE/ (CIK 0000793279)
Date: March 7, 2005 · CIK: 0000793279 · Accession: 0000000000-05-010554
AI Filing Summary & Sentiment
Letter
Mail Stop 0306 March 7, 2005 Mr. F. Paul Broyer Chief Financial Officer Candela Corporation 530 Boston Post Road Wyland, Massachusetts 01778
Re: Candela Corporation Form 10-K for the fiscal year ended July 3, 2004 Filed 9/15/04 Form 10-Q for the Period Ending October 2, 2004 File No. 0-14742
Dear Mr. Broyer:
In connection with our financial statement only review of Candela Corporation`s 2004 Form 10-K and subsequent Exchange Act filings, we have the following additional accounting comments. Form 10-Q for the Period Ending October 2, 2004
Management`s Discussion and Analysis - Page 12
Discontinued Operations - Page 14
1. We recognize your response to our Comment 6 and reissue the first part of our comment. Supplementally, please indicate when Candela was notified by the landlord that a sublease for the property was secured during the first quarter fiscal 2005. Please indicate the terms of the sublease that were conveyed to you by the landlord. You indicate that prior to the events which occurred during the second quarter fiscal 2005, the Company could not estimate the amount of sublease income. What events are you referring to that occurred in the first quarter of fiscal 2005 that allowed you to estimate the amount of the sublease income? Please clarify why an estimate should not have been made in the first quarter of fiscal 2005, in light of the sublease being secured in the same quarter.
Form 8-K dated February 11, 2005
Exhibit 99.1 Press Release Announcing Decision of Arbitrator in Dispute with Regents of the University of California
2. We note that on February 17, 2005 the arbitrator reached an interim decision in the dispute concerning Candela`s royalty obligations in favor of the Regents. Candela had previously deposited $3.4 million in an escrow account with no charge to expense, pending the outcome of the arbitration. We refer to your response to our Comment 5. The press release indicates that Candela will take a charge for the related expense in the fiscal quarter in which the arbitrator issues his final decision. In light of the interim decision and the probability of the outcome, please clarify why the conditions had not been met to record the accrual in the earlier periods. Refer to SFAS 5.
As appropriate, please respond to these comments within 10 business days or tell us when you will provide us with a response. Please furnish a cover letter with your response that keys your responses to our comments and provides any requested supplemental information. Detailed cover letters greatly facilitate our review. Please file your cover letter on EDGAR. Please understand that we may have additional comments after reviewing your responses to our comments.
You may contact Dennis Hult, Staff Accountant, at (202) 942- 2812 or myself if you have questions regarding comments on the financial statements and related matters. Please contact me at (202) 942-1791 with any other questions
Sincerely,
Brian Cascio
Accounting Branch Chief
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<TEXT>
Mail Stop 0306
March 7, 2005
Mr. F. Paul Broyer
Chief Financial Officer
Candela Corporation
530 Boston Post Road
Wyland, Massachusetts 01778
Re: Candela Corporation
Form 10-K for the fiscal year ended July 3, 2004
Filed 9/15/04
Form 10-Q for the Period Ending October 2, 2004
File No. 0-14742
Dear Mr. Broyer:
In connection with our financial statement only review of Candela
Corporation`s 2004 Form 10-K and subsequent Exchange Act filings,
we
have the following additional accounting comments.
Form 10-Q for the Period Ending October 2, 2004
Management`s Discussion and Analysis - Page 12
Discontinued Operations - Page 14
1. We recognize your response to our Comment 6 and reissue the
first
part of our comment. Supplementally, please indicate when Candela
was notified by the landlord that a sublease for the property was
secured during the first quarter fiscal 2005. Please indicate the
terms of the sublease that were conveyed to you by the landlord.
You
indicate that prior to the events which occurred during the second
quarter fiscal 2005, the Company could not estimate the amount of
sublease income. What events are you referring to that occurred
in
the first quarter of fiscal 2005 that allowed you to estimate the
amount of the sublease income? Please clarify why an estimate
should
not have been made in the first quarter of fiscal 2005, in light
of
the sublease being secured in the same quarter.
Form 8-K dated February 11, 2005
Exhibit 99.1 Press Release Announcing Decision of Arbitrator in
Dispute with Regents of the University of California
2. We note that on February 17, 2005 the arbitrator reached an
interim decision in the dispute concerning Candela`s royalty
obligations in favor of the Regents. Candela had previously
deposited $3.4 million in an escrow account with no charge to
expense, pending the outcome of the arbitration. We refer to your
response to our Comment 5. The press release indicates that
Candela
will take a charge for the related expense in the fiscal quarter
in
which the arbitrator issues his final decision. In light of the
interim decision and the probability of the outcome, please
clarify
why the conditions had not been met to record the accrual in the
earlier periods. Refer to SFAS 5.
As appropriate, please respond to these comments within 10
business days or tell us when you will provide us with a response.
Please furnish a cover letter with your response that keys your
responses to our comments and provides any requested supplemental
information. Detailed cover letters greatly facilitate our
review.
Please file your cover letter on EDGAR. Please understand that we
may have additional comments after reviewing your responses to our
comments.
You may contact Dennis Hult, Staff Accountant, at (202) 942-
2812 or myself if you have questions regarding comments on the
financial statements and related matters. Please contact me at
(202)
942-1791 with any other questions
Sincerely,
Brian Cascio
Accounting Branch Chief
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F. Paul Broyer
Candela Corporation
March 7, 2005
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