SecProbe.io

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Mail Stop 0306

January 18, 2005

VIA U.S. MAIL AND FAX (734) 414-4840

Mr. John J. Garber
Vice President and Chief Financial Officer
Perceptron, Inc.
47827 Halyard Drive
Plymouth, Michigan 48170

	Re:	Perceptron, Inc.
		Form 10-K for the year ended June 30, 2004

Dear Mr. Garber:

      We have reviewed your filings and have the following
comments.
We have limited our review to only your financial statements and
related disclosures and will make no further review of your
documents. Where indicated, we think you should revise your
documents
in future filings in response to these comments.  If you disagree,
we
will consider your explanation as to why our comment is
inapplicable
or a revision is unnecessary.  Please be as detailed as necessary
in
your explanation.  In some of our comments, we may ask you to
provide
us with supplemental information so we may better understand your
disclosure.  After reviewing this information, we may or may not
raise additional comments.

      Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your
filings.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or on any other
aspect
of our review.  Feel free to call us at the telephone numbers
listed
at the end of this letter.

Form 10-K for the year ended June 30, 2004

Item 7. Management`s Discussion and Analysis of Financial
Condition
and Results of Operations

General

1. We noted that you included a brief Overview section as an
introduction to your MD&A. Consider enhancing your Overview
section
in future filings to address current events, including the
following:
* the most important themes or other significant matters with
which
management is concerned primarily in evaluating the company`s
current
financial condition;
* further insight into current material opportunities, challenges
and
risks; and
* a business analysis of the company`s current approach to
specific
challenges and opportunities that lie ahead.

      Refer to SEC Release Nos. 33-8350, 34-48960, and FR-72.

Results of Operations - Page 9

2. In future filings, where changes in financial statement line
items
are the result of several factors; each significant factor should
be
separately quantified and discussed.  For example, you state that
the
decrease in selling, general and administrative expenses
"primarily
reflected lower bad debt, Michigan single business tax, and legal
expenses that were partially offset by salary and benefit
increases
and the impact of the strong Euro,"  However, you do not quantify
the
impact of each of these factors.

Critical Accounting Policies - Page 14

3. Please tell us why you do not believe revenue recognition to be
one of the company`s critical accounting policies.

Market Risk Information

Foreign Currency Risk - Page 15

4. Please revise future filings to provide the potential loss in
future earnings of market risk sensitive instruments resulting
from
one or more selected hypothetical changes in foreign currency
exchange rates over a selected period of time.  You should select
hypothetical changes in market rates or prices that are expected
to
reflect reasonably possible near-term changes in those rates and
prices.  Reference is made to Item 305 of Regulation S-K.  For
examples, see Appendix to Item 305 of Regulation S-K - Tabular
disclosures.

Note 1. Summary of Significant Accounting Policies

Revenue Recognition - Page 22

5. We noted you sell your products to original equipment
manufacturer`s, value-added resellers, system integrators, and
directly to end users. Tell us and expand your revenue recognition
policy to explain whether any of your product sales include price
protection agreements or any obligations to buy back inventory
from
original equipment manufacturers or value-added resellers.   If
you
have price protection agreements or are required to potentially
buy
back inventory tell us how you recognize revenue and cite the
specific accounting literature that you have relied upon.

6. We also noted that you sell multiple element arrangements to
your
customers. Please tell us, and investors in future filings, if
each
delivered item has value to the customer on a stand-alone basis
and
whether the delivered items include general rights of return. In
addition, please tell us the nature of your sales agreements and
whether any delivered items are contingent upon the delivery of
any
undelivered additional items and the company`s related revenue
recognition policy.

7. Please also tell us and expand your revenue recognition
policies
related to product returns, including the company`s policy and
related accounting.

8. We noted your discussion regarding software products that you
license to customers pursuant to license agreements in the
business
section. However, we did not note any discussion of such
agreements
in the footnotes to the financial statements. Please tell us, and
investors in future filings, the nature of these agreements and
the
related accounting. Please also cite the related accounting
guidance
on which you based your accounting.

Foreign Currency - Page 22

9. In future filings please disclose the aggregate transaction
gain
or loss included in determining net income for the period in the
financial statements or footnotes to the financial statements.
See
paragraph 30 of SFAS 52.

Inventories - Page 23

10. We noted that the company provides a reserve for obsolescence.
Please provide us, and investors in future filings, with more
information with regards to management`s policy for reviewing
inventory for obsolescence. Specifically, please provide more
details
of the "other matters" and discuss the frequency with which
management reviews the reserve.

Warranty - Page 24

11. Please revise future filings to provide the disclosures
required
by paragraph 14 of FIN 45. Alternatively, tell us why you believe
such disclosures are not required.

Stock-Based Employee Compensation - Page 24

12. In future filings please present the table illustrating the
pro
forma effect on net income and earnings per share in accordance
with
paragraph 2.e.c of SFAS 148.

Note 6. Commitments and Other - Page 26

13. We noted your discussion of the contingent royalty payments on
sales using the Sonic technology through October 2004. We also
noted
that you prepaid certain of these royalty payments. Please tell us
the status of the activity as of June 30, 2004. Is there a prepaid
asset included in your balance sheet or a liability as of June 30,
2004? What is the company`s remaining commitment under this
agreement?

14. We noted the company`s use of foreign currency cash flow
hedges.
Supplementally, and in future filings tell us the amount of the
gain/loss recognized in earnings during the reporting period as
well
as a description of the transactions that will result in the
reclassification into earnings of gains/losses that are reported
in
other comprehensive income. See paragraphs 44 and 45 of SFAS 133
as
amended.

*    *    *    *

      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 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.

      We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require.
Since the company and its management are in possession of all
facts
relating to a company`s disclosure, they are responsible for the
accuracy and adequacy of the disclosures they have made.

      In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that

?	the company is responsible for the adequacy and accuracy of
the
disclosure in the filings;
?	staff comments or changes to disclosure in response to staff
comments in the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the filing; and
?	the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

      In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.

      You may contact Julie Sherman, Staff Accountant, at (202)
824-
5506 or me at (202) 942-2813 if you have questions.  In this
regard,
do not hesitate to contact Martin James, the Senior Assistant
Chief
Accountant, at (202) 942-1984.

							Sincerely,

							Daniel Gordon
							Branch Chief
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Mr. John J. Garber
Perceptron, Inc.
January 18, 2005
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