SecProbe.io

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-4631

       DIVISION OF
CORPORATION FINANCE

Mail Stop 4631
January 13, 2010

via U.S. mail and facsimile

Betty Lam, Chief Financial Officer,   Deswell Industries, Inc. 17B, Edificio Comercial Rodrigues,  599 Avenida da Praia Grande, Macao Special Administrative Region, PRC
 RE: Deswell Industries, Inc.
  Form 20-F for the Fiscal  Year Ended March 31, 2009
  Filed August 14, 2009   File No. 001-33900
Dear Ms. Lam:

We have reviewed the above referenced filings and have the following comments.
Where indicated, we think you should revise your  disclosures in future filings in response
to these comments. If you disagree, we w ill consider your explanation as to why our
comment is inapplicable or a revision is unneces sary.  Please be as detailed as necessary
in your explanation.  In some of our comme nts, 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 re view process is to assist you in your
compliance with the applicable disclosure  requirements and to  enhance the overall
disclosure in your filing.  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.

Betty Lam, Chief Financial Officer
Deswell Industries, Inc. January 13, 2010 Page 2   Form 20-F for the Fiscal Year Ended March 31, 2009

 Note 2 – Summary of Significant Accounting Policies, page F-6

 Foreign Currency Tr anslation, page F-8

1. We note effective January 1, 2009, your s ubsidiaries change d their functional
currencies to the U.S. dollar because you cons idered the U.S. dollar to be the most
appropriate functional currencies of the your  subsidiaries.  We have the following
comments regarding your acc ounting and disclosures.

• With reference to salient economic fact ors set forth in Appendix A of SFAS 52,
please provide us a comprehensive analysis  regarding the appr opriateness of this
change.
• As indicated in paragraph 46 of SFAS 52, if the functional currency of a foreign
entity changes from the currency of its country to the currency of its parent
company's country, the translation adjustme nts that apply to the entity and that
have been accumulated in other comprehe nsive income in prior years should be
retained in that account.   Nonmonetary a ssets that the entity owned at the end of
the period immediately before the change should be translated in subsequent
periods at the exchange rate that was cu rrent at the end of that period.  Please
confirm, and revise future filings to clarify, that this is how the company
accounted for this change.  In this rega rd, please clarify why as of January 1,
2009, the company re-measured its  subsidiaries’ assets a nd liabilities and expense
items which related to non-monetary asse ts and liabilities to U.S. dollars and
recorded the resulting net gain in other comprehensive income.
• Please confirm, and expand your disclosures in future filings, that subsequent to
January 1, 2009 you appropriately applied the remeasurement guidance set forth
in paragraph 47 of SFAS 52.  Otherwise address the appropriateness of your
accounting.
• In future filings please disclose in Ma nagement’s Discussion and Analysis the
actual and reasonably likely effects of the change in your functional currency,
including its impact on your results of  operations, liquidity, and cash flows.
 Item 6. Directors, Senior Mana gement and Employees, page 36

2. In future filings, if shares remain av ailable for future issuance under your 1995
Stock Option Plan, please file  or incorporate by reference this plan as an exhibit
to your Form 20-F.  Please refer to Instru ction 4(c) as to exhibits on Form 20-F.

Betty Lam, Chief Financial Officer
Deswell Industries, Inc. January 13, 2010 Page 3  Item 7. Major Shareholders and Re lated Party Transactions, page 39

3. We note from the beneficial ownership tables on pages 39 and 40 that different
ownership percentages are attributed to Richard Pui Hon Lau as of June 30, 2009.
Please explain to us the reason for this apparent inconsistency and, in future
filings, please ensure that your  beneficial ownership tabl es are consistent.  Please
refer to Item 7.A of Form 20-F.

Item 10. Additional Information, page 42
4. In future filings, please provide the disc losure regarding “documents on display”
as required by Item 10.H of Form 20-F.

Item 15. Controls and Procedures, page 50
 Disclosure Controls and Procedures, page 50

5. In future filings, please revise your discus sion under this heading to reflect that
the evaluation of your disclosure controls  and procedures is required by paragraph
(b) of Rule 13a-15 and 15d-15 of the Exchange Act.

*    *    *    *

As appropriate, please respond to these co mments within 10 business days or tell
us when you will provide us with a response.  Please furnish a letter that keys your
responses to our comments and provides any requested supplemental information.
Detailed response letters  greatly facilitate our  review.  Please file your response letter on
EDGAR.  Please understand that we may ha ve additional comments after reviewing
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 sta ff to be certain that they have provided all
information investors require.  Since the co mpany 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 their
filings;
• staff comments or changes to disclosure  in response to staff comments do not
foreclose the Commission from taking any action with respect to the filing; and

Betty Lam, Chief Financial Officer
Deswell Industries, Inc. January 13, 2010 Page 4
• the company may not assert staff comments as a defense in any proceeding
initiated by the Commission or any person under the federal secu rities laws of the
United States.
  In addition, please be advi sed that the Division of En forcement has access to all
information you provide to the staff of the Divi sion of Corporation Fi nance in our review
of your filing or in response to our comments on your filing.   You may contact Tracey McKoy, Staff A ccountant, at (202) 551-3772 or, in her
absence Jeanne Baker at (202) 551-3691 or th e undersigned Accounting Branch Chief at
(202) 551-3355 if you have questions regard ing comments on the financial statements
and related matters. Please c ontact Hagen Ganem, Staff A ttorney, at (202) 551-3330 or
Dieter King, Staff Attorney, at (202) 551-3338 with any legal related questions.

Sincerely,
           T e r e n c e  O ’ B r i e n          A c c o u n t i n g  B r a n c h  C h i e f