SEC Company Response from DEFAULT PROOF CREDIT CARD SYSTEM — Jul 29, 2005
DEFAULT PROOF CREDIT CARD SYSTEM INC /FL/ (CIK 0000803260)
Date: July 29, 2005 · CIK: 0000803260 · Accession: 0001091818-05-000247
AI Filing Summary & Sentiment
File numbers found in text: 000-24444
Referenced dates: July 18, 2005
Letter
July 28, 2005 VIA EDGAR Cicely Luckey Division of Corporate Finance United States Securities and Exchange Commission 450 Fifth Street, N. W. Mail Stop 04-09 Washington, D.C.
Re: Default Proof Credit Card System, Inc. Form 10KSB/A File No. 000-24444
Dear Ms. Luckey:
At the request of the Securities and Exchange Commission we are providing this letter in response to certain comments made in the Commission's letter dated July 18, 2005 regarding our 10-KSB/A file No. 000-24444. 2005. We are providing the following letter containing our responses.
COMMENT 1: Report of Independent Registered Public Accounting Firm.
We noted that your report of the independent registered public accounting firm was not signed. Tell us how you considered Item 302 of Regulation S-T. Confirm that a manually signed audit opinion has been received from the independent registered public accounting firm.
RESPONSE: A manually signed audit opinion had been received from our independent registered public accounting firm. In the future a /s/ will be included on the electronically filed versions on the audit opinion to denote a signed copy. A form 10KSB/A (Amendment #3) has been filed to denote the /s/.
COMMENT 2: Note 10- Due to Related Party
We have read and considered your response to comment 3 and remain unclear how your accounting treatment complies with the guidance in APB 26 footnote 1. Accordingly, it appears that you should have shown forgiveness of debt by the related party as a reduction of equity.
RESPONSE: FAS 140 paragraph 16 provides for the extinguishment of debt if the creditor is relieved of its obligation to pay the liability, with payment in the form of other financial assets. The company transferred the rights to one patent application pending in exchange for a $20,000 reduction in the amount owed to the CEO. Since the "patent rights" that were transferred had no value on the balance sheet, the full $20,000 profit was classified as "Other Income".
If you should have any questions, please feel free to contact me.
Sincerely,
/s/ Charles Menendez
---------------------
Charles Menendez
President and Chief Financial Officer.
Show Raw Text
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[LETTERHEAD]
Default Proof Credit Card System, Inc.
1545 Miller Road
Coral Gables, FL 33146
#305-666-1460, #305-665-3462
July 28, 2005
VIA EDGAR
Cicely Luckey
Division of Corporate Finance
United States Securities and Exchange Commission
450 Fifth Street, N. W.
Mail Stop 04-09
Washington, D.C.
20549
Re: Default Proof Credit Card System, Inc. Form 10KSB/A File No. 000-24444
Dear Ms. Luckey:
At the request of the Securities and Exchange Commission we are providing this
letter in response to certain comments made in the Commission's letter dated
July 18, 2005 regarding our 10-KSB/A file No. 000-24444. 2005. We are
providing the following letter containing our responses.
COMMENT 1: Report of Independent Registered Public Accounting Firm.
We noted that your report of the independent registered public
accounting firm was not signed. Tell us how you considered
Item 302 of Regulation S-T. Confirm that a manually signed
audit opinion has been received from the independent
registered public accounting firm.
RESPONSE: A manually signed audit opinion had been received from
our independent registered public accounting firm. In the
future a /s/ will be included on the electronically filed
versions on the audit opinion to denote a signed copy. A
form 10KSB/A (Amendment #3) has been filed to denote the /s/.
COMMENT 2: Note 10- Due to Related Party
We have read and considered your response to comment 3 and
remain unclear how your accounting treatment complies with the
guidance in APB 26 footnote 1. Accordingly, it appears that
you should have shown forgiveness of debt by the related party
as a reduction of equity.
RESPONSE: FAS 140 paragraph 16 provides for the extinguishment of debt if
the creditor is relieved of its obligation to pay the liability,
with payment in the form of other financial assets. The
company transferred the rights to one patent application pending
in exchange for a $20,000 reduction in the amount owed to the
CEO. Since the "patent rights" that were transferred had no
value on the balance sheet, the full $20,000 profit was classified
as "Other Income".
If you should have any questions, please feel free to contact me.
Sincerely,
/s/ Charles Menendez
---------------------
Charles Menendez
President and Chief Financial Officer.
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