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VIA
EDGAR

April 22, 2009

United
States Securities and Exchange Commission

100
F Street, NE

Washington,
D.C. 20549-4561

  Attn:

  Ms. Kathleen Collins

  Ms. Melissa Feider

  Mr. Kevin
  Dougherty

  Mr. Mark
  P. Shuman

  RE:

  Innovative
  Solutions and Support, Inc.

  Form 10-K
  and Form 10-K/A for Fiscal Year Ended

  September 30,
  2008

  Filed
  December 11, 2008 and December 19, 2008

  Form 10-Q
  for the Fiscal Quarter Ended December 31, 2008

  Filed
  on February 6, 2009

  File
  No. 000-31157

Dear
Ms. Collins and Ms. Feider:

On
behalf of Innovative Solutions and Support, Inc. (the “Company”), we
respond to the written comments of the staff (the “Staff”) of the Securities
and Exchange Commission (the “Commission”) contained in your letter dated April 10,
2009 to John C. Long (the “Comment Letter”), with respect to Form 10-K and
Form 10-K/A for Fiscal Year Ended September 30, 2008, filed with the
Commission by the Company on December 11, 2008 and December 19, 2008,
respectively, and Form 10-Q for the Fiscal Quarter Ended December 31,
2008, filed with the Commission by the Company on February 6, 2009 (File No. 000-31157).

The
headings and numbered items of this letter correspond to the headings and
numbered items contained in the Comment Letter. For the convenience of the
Staff, each of the comments from the Comment Letter is restated in bold italics
prior to the Company’s response.

General

1.             We
note from your response to prior comment 1 that the “typographical errors” did
not result in a mathematical mistake based on your consideration of the
definition of an error pursuant to SFAS 154.
However, the typographical error of using the wrong net loss figure
resulted in an error in the presentation of the cash flow statement and caused
the mathematical calculations of “net cash provided by (used in) operating
activities”, “net decrease in cash and cash equivalents”, and “cash and cash
equivalents, end of year” to be incorrect.
As a result, it appears that the typographical errors would meet the
definition of an error and, assuming these errors are considered

material, the Company should have filed an Item
4.02 8-K and labeled the related cash flow information as restated[.]  In this regard, please provide the Company’s
SAB 99 analysis in determining whether these errors were considered to be
material.

Response:

The
Company notes the Staff’s comment but respectfully disagrees with the Staff’s
conclusion that “it appears that the typographical errors would meet the
definition of an error” as defined in Statement of Financial Accounting
Standards No. 154 (“SFAS No. 154”), which superseded Accounting
Principles Board Opinion No. 20 (“APB No. 20”).  As explained in our March 27, 2009
letter, the Company believes that the errors in presentation that occurred in
the consolidated statement of cash flows for the year ended September 30,
2008 were the result of a mis-key of a cell reference on an Excel spreadsheet,
which caused the incorrect net income amount to be included on the consolidated
statement of cash flows in the Company’s Form 10-K that was filed on December 11,
2008.  The mathematical calculations of “net
cash provided by (used in) operating activities,” “net decrease in cash and
cash equivalents,” and “cash and cash equivalents, end of year” were also
presented incorrectly on the consolidated statement of cash flows in the Form 10-K,
solely because the incorrect net income amount was improperly included.

SFAS
No. 154 defines an “error in previously issued financial statements” as “an
error in the recognition, measurement, presentation, or disclosure in the
financial statements resulting from
mathematical mistakes, mistakes in the application of GAAP, or oversight or
misuse of facts that existed at the time the financial statements were
prepared.” (emphasis added).  Since there was no mistake in the application
of GAAP or oversight or misuse of facts that existed at the time the financial
statements were prepared, to conclude that an error occurred as defined under
SFAS No. 154 and therefore determine that a Form 8-K was required to
be filed under Item 4.02(a), the errors in presentation in the financial
statements must have resulted from a
mathematical mistake.   In his book SOX 404 for Small, Publicly Held Companies:  Internal Control Assessment and Reporting
Under Sarbanes-Oxley Robert Sonnelitter when discussing SFAS 154
states that mathematical mistakes occur when “a specified mathematical
operation is not correct” or “the specified mathematical operation is not
correctly performed.”  As a result of the
typographical error in the net loss line item described above, the other line
items also became misstated, but this was not due to a specified mathematical
operation not being correct or not being correctly performed.  Instead, it was because once the incorrect
net loss number was inserted into the statement, the specified mathematical
procedures were correctly performed, resulting in an incorrect presentation for
the three additional line items.  Because
mathematical calculations determined the line items in question that were
ultimately incorrect does not necessarily mean that the errors in those line
items resulted from a mathematical mistake.

Instead,
as noted in our March 27 letter, all of the errors in presentation on the
statement of cash flows resulted from what we would consider to be one “typographical
error” in the input of the net loss line item.
According to the Free On-line Dictionary of
Computing, a typographical error is defined as an “error while
inputting text via keyboard, made despite the fact that the user knows exactly
what to type in. This usually results from the operator’s inexperience at
keyboarding, rushing, not paying attention, or carelessness.”  Therefore, because the error in the
presentation of the line items on the cash flow statement resulted
from a typographical error and not a mathematical mistake, the error
in presentation is not considered an error within the plain meaning of the term
under SFAS No. 154, and therefore no Item 4.02 Form 8-K is required,
no SAB 99 analysis is required to be performed and the cash flow statement need
not be labeled as restated.

Item 5.
Market for the Registrant’s Common Equity, Related Stockholder Matters and
Issuer Repurchase of Equity Securities

Comparison
of the Five Year Total Return, page 20

2.             Your
response to prior comment 4 states that you do not use a published industry or
line-of-business index because you are not aware of any such index made of
companies that are comparable to you and that would be accessible to your
security holders or is widely recognized and used.  However, we note that other companies in the
aerospace and aviation industry, under such SIC codes as 3721, 3728, 3812, and
3823, which appear to be comparable to you have identified and used such
indices for comparison in their performance graphs; including the SPADES
Defense index, the Dow Jones US Aerospace Index, or the S&P Aerospace and
Defense Index.  Please advise as to why
identification and use of such industry or line-of-business indices are not
feasible or appropriate; or alternatively why you are unable to construct an
index of peer issuer(s), which need not be limited to direct competitors.

Response:

The
Company accepts the Staff’s comment and will include the Dow Jones US Aerospace &
Defense Index on the stock performance table in its Proxy Statement for the
2010 annual meeting of shareholders based on its determination that including
the Dow Jones US Aerospace & Defense Index would comply with the
requirements of Item 201(e)(1)(ii) of Regulation S-K.

Note 3.
Summary of Significant Accounting Policies, Revenue Recognition, page 39

3.             You
state in your response to prior comment 6 that the Company has not recognized
any revenue under SOP 97-2 in the historical financial statements.  However, from your response to prior comment
4 of your letter dated March 2, 2007, it appears that revenue from some of
your arrangements was recognized pursuant to SOP 97-2.  Please clarify this discrepancy and tell us
whether you subsequently concluded that the arrangements discussed in your March 2,
2007 response letter should have been accounted for pursuant to SAB 104 from
inception.  Also, tell us the percentage
of revenue recognized pursuant to SOP 97¬2 for each period presented and if
applying SAB 104 would have resulted in different revenue recognition.  Additionally, tell us when and if there was a
specific event that caused the Company to change its determination that SAB 104
was the appropriate guidance for revenue recognition.

Response:

The
Company notes the Staff’s comment and the Staff’s reference to our letter dated
March 2, 2007.  In the March 2,
2007 letter we stated:

 “Based on the considerations of the above
guidance, the Company’s product sales (non-long term) should be accounted for
under the guidance of SOP 97-2. Per SOP 97-2 revenue is recognized when all of
the following criteria are met:

·                  Persuasive evidence of an arrangement exists;

·                  Delivery has occurred or services have been
rendered;

·                  The seller’s price to the buyer is fixed or
determinable; and

·                  Collectibility is reasonably assured.

The
requirements of SOP 97-2 are consistent with the general requirements of SAB
104 noted above. As noted in SOP 97-2, software contracts may include post
contract support and other related services. Although the Company’s product
sales fall within the scope of SOP 97-2, the current product sales transactions
do not include post contract support and other related services. As such, these
portions of SOP 97-2 are not applicable to the Company.”

As
noted in our March 2, 2007 letter, none of the product sales recognized at
the time of the response contained “post contract support and other related
services,” and revenue for those sales was therefore recognized at the time the
product was shipped.  The Company also
noted in its March 2007 response that the requirements of Statement of
Position 97-2, Software Revenue Recognition
(“SOP 97-2”) in the context of the product sales recognized at the time were
consistent with the requirements of Staff Accounting Bulletin No. 104, Revenue Recognition (“SAB 104”).   In the Company’s response letter dated March 27,
2009, it was stated that “The Company has not recognized any revenue under SOP
97-2 in its historical financial statements.”
This statement is accurate because although the Company believed at the
time of its March 2, 2007 response that its product sales should be
accounted for under SOP 97-2, the sales activity and the nature of the then
existing customer agreements under which the sales activity occurred resulted
in the Company recognizing product sales under SAB 104, which management has
concluded  was correct.  This statement is also accurate for revenue
recognized related to sales arrangements with multiple deliverables for which
the Company recognized revenue in accordance with EITF 00-21, Revenue Arrangements with Multiple Deliverables
(“EITF 00-21”).  This revenue recognition
policy was previously stated in our March 27, 2009 letter. The Company
does note, however, that the disclosure relating to the Company’s revenue
recognition policy (Note 3 in the Company’s financial statements as of September 30,
2008) references SOP 97-2, even though no revenue was recognized under such
guidance.  The Company will revise its
disclosure, as indicated in the March 27, 2009 letter, in its second
quarter 10-Q filing to be submitted on or before May 11, 2009 to remove
the references to SOP 97-2.

In
response to the Staff’s inquiry regarding whether there was a “specific event
that caused the Company to change its determination that SAB 104 was the
appropriate guidance for revenue recognition,” the Company notes that it is not
aware of any specific event that caused the change in its determination.  Current financial management has determined
that none of the Company’s contracts, nor any of its product sales, contained
provisions or products that would have required recognition under SOP 97-2
versus SAB 104 and /or under the guidance included in EITF 00-21, as
appropriate.  As noted in our March 27,
2009 letter, the Company’s products have included flat panel displays and air
data systems, and these products have remained relatively unchanged.  The Company has recognized revenue
appropriately and consistently under SAB 104 and EITF 00-21, as applicable,
since its March 2, 2007 response.

In
summary, current financial management has reviewed the sales arrangements and related
revenue recognized and has concluded, for the reasons discussed above and in
our March 27, 2009 letter, that the historical revenue recognition
policies it has utilized have been consistent with SAB 104 and/or EITF 00-21,
and that software is not more than incidental to the product.  Further, the Company concluded that it should
continue to recognize revenue under SAB 104 and /or EITF 00-21, as
applicable,  that revenue previously
recognized had not been misstated and that no errors occurred.   As noted in our March 27, 2009 letter,
in light of the constant evolution of the Company’s products as well as the
fact that they do include embedded software, the Company does plan to continue
to consider the applicability of SOP 97-2 (and any other potentially applicable
accounting guidance) to each new product and/or customer arrangement.

4.             Additionally,
explain in detail, how you determined whether or not the subsequent evaluation
of the Company’s products, which resulted in the change from SOP 97-2 to SAB
104, should be considered a correction of an error pursuant to SFAS 154.

Response:

The
Company notes the Staff’s comment and respectfully refers the Staff to our
response to comment #3 above.  The
Company, upon determining that the software utilized is not
more-than-incidental to the Company’s flat panel products and therefore not
subject to revenue recognition under SOP 97-2, considered whether revenue
recognized up to that time was appropriate and concluded, for the reasons
discussed above, that it was.  The
Company concluded that under SAB 104, any revenue recognized would be the same
as under SOP 97-2 for the activity that occurred.  As a result, the Company concluded that
revenue recognized had not been misstated, and that no errors occurred.

5.             Please
refer to prior comment 8.  Tell us how
you considered disclosing that your customer contracts include provisions “requiring
the payment of all revenue earned and costs incurred through the date of
contract termination” to make it clear that there is no risk with respect to
refundable fees associated with contract termination rights.

Response:

The
Company notes the Staff’s comment and respectfully submits that its customer
contracts do not provide the customer the right to any sort of refundable fee
associated with their contract termination rights.  Previously, the Company had not considered
the prospect of refundable fees associated with contract rights to be a
sufficient risk such that additional disclosure was required.  However, to provide further clarity, in
future filings the Company will provide additional disclosure to make it clear
there is no risk with respect to refundable fees associated with contract
rights because the customer has the obligation to pay for all revenue earned
and costs incurred through the date of termination.  Had this enhanced disclosure been provided in
the Company’s Form 10-K for the fiscal year ended September 30, 2008,
it would have read as follows:

Sales
to government contractors and agencies accounted for approximately 23%, 36% and
51% of total sales during fiscal years 2008, 2007 and 2006, respectively.  While under these contracts the gove