SecProbe.io

CORRESP
1
filename1.htm

SIDLEY AUSTIN BROWN & WOOD LLP

  BEIJING

  1501 K STREET, N.W.

  LOS ANGELES

  WASHINGTON, D.C. 20005

  BRUSSELS

  TELEPHONE 202 736 8000

  NEW YORK

  FACSIMILE 202 736 8711

  CHICAGO

  www.sidley.com

  SAN FRANCISCO

  FOUNDED 1866

  DALLAS

  SHANGHAI

  GENEVA

  SINGAPORE

  HONG KONG

  TOKYO

  LONDON

  WASHINGTON, D.C.

  WRITER’S DIRECT NUMBER

  WRITER’S E-MAIL ADDRESS

  (202) 736-8660

  aghais@sidley.com

July 26, 2005

BY EDGAR

Larry Spirgel

Assistant Director

Division of Corporation Finance

United States Securities and
Exchange Commission

100 F Street, NE

Washington, DC  20549

  RE:

  ClearComm,
  L.P.

  Form 10-K/A
  for the fiscal year ended December 31, 2004

  Form 10-Q
  for the period ended March 31, 2005

  File No.
  0-28362

Dear Mr. Spirgel:

On behalf of
our client, ClearComm, L.P. (the “Partnership”), we are responding to the
comments of the staff of the Securities and Exchange Commission (the “Commission”)
as set forth in your letter dated July 12, 2005 to Mr. Javier O.
Lamoso, President of the Partnership’s general partner, with respect to (i) the
Partnership’s Form 10-K/A for the fiscal year ended December 31, 2004, (ii) the
Partnership’s Form 10-Q for the period ended March 31, 2005, and (iii) our
supplemental response letter dated June 1, 2005.  The original Form 10-K was filed with
the Commission on March 29, 2005, the Form 10-K/A was filed with the Commission
on June 1, 2005, and the Form 10-Q was filed with the Commission on
May 23, 2005.

In your letter
of July 12, 2005, you asked that the Partnership provide you with a
written response to the comments made in your letter and, in addition, that the
Partnership file a second amended Form 10-K (the “Form 10-K/A”) that
reflects changes made in response to your comments.  Accordingly, we have provided below each of
the comments made in your letter, and the Partnership’s responses to each such
comment.  The headings and numbered
paragraphs below correspond to the headings and numbered paragraphs in your
letter.  We will file the
Form 10-K/A concurrently with the submission of this letter to you.

Form 10-K/A
for the year ended December 31, 2004

Report of
independent public accountants, page 50

1.                                       Please
ask your auditors to revise their report for the following:

•                  to make reference to the Standards of the
Public Company Accounting Oversight Board in accordance with auditing standard
no. 1 of the PCAOB; and

•                  to include a signed audit report.

Partnership’s Response:  Our Auditors have revised their report in the
manner you have instructed, and the revised report will be included with the
Form 10-K/A to be filed today with the Commission.

Notes to
consolidated financial statements

Note 3 –
Significant accounting policies

(h)
Inventories, page 31

2.                                       Please
refer to your response to comment No. 6.
We believe that the change in accounting method for the loss on the sale
of handsets to customers is not appropriate.
The fact that you sell the handsets in connection with a service
contract at a loss does not mean that the handsets cannot be sold over the cost
of the unit.  It appears that the handset
subsidy is a marketing strategy to obtain new customers.  Therefore, we believe that you should
continue with your accounting policy before January 1, 2003 and recognize the
loss on the sale of the handsets at the time of the sale.  Please revise or advise.

Partnership’s Response:  The Partnership believes that the new method
for presenting inventory balances and the loss on the sale of handsets
accurately reflects the net realizable value of its inventory and complies with
matching principles for income and expenses and the concept of lower of cost or
market for valuing inventory, as required under Generally Accepted Accounting
Principles (GAAP), due to the following:

ARB 43 –
Inventory Pricing – states that “when
the utility of the goods in the ordinary course of business is no longer as
great as their cost, a departure from the cost principle of measuring the
inventory is required.  Whether the cause is obsolescence, physical
deterioration, changes in price level, or any other,
the difference should be recognized

2

by a charge to income in the current period.  This is accomplished by stating the
goods at a lower level designated as market” (emphasis added).

The Partnership believes that the utility of its inventory in the
ordinary course of business is no longer as great as its cost because the
selling price to the end customer is minimal due to industry practice in the
Caribbean region, where the Partnership’s business is conducted.  The use of the lower-of-cost-or-market approach
to pricing its inventory and the realization of a loss on the sales of handsets
in the current period rather that at the point of sale is not a marketing
strategy (as your letter indicates), but is instead a required practice pursuant
to GAAP and ARB 43.

The accounting policy adopted by the
Partnership is consistent with the general concept that inventory held for
resale must be valued at the lower of cost or market.  There is no market for these purchased
handsets.  The Partnership, through its
subsidiary NewComm Wireless Services, Inc. (“NewComm”), is not engaged in the
business of reselling handsets in the equipment market and, in fact, it would
not be possible to engage in that business except in the rare case that NewComm
decided to dispose of this inventory at give-away prices.  The Partnership believes the practice of
matching costs and revenues is inferior to the lower-of-cost-or-market practice
adopted by the Partnership, which practice is consistent with the theory of
anticipating losses but not profits.

In short, because the handsets could not be resold at purchase cost in
the ordinary course of business, the Partnership believes the practice of
providing for the loss inherent in the purchase price of handsets at the moment
of purchase by the Partnership is consistent with the correct accounting
principle and preferable to delaying the recognition of loss until the time of
sale and delivery to a new or existing subscriber.  For this reason, the Partnership believes its
practice is preferable to the alternative proposed by your accounting staff.

Form 10-Q for
the period ended March 31, 2005

Item 4,
Control and procedures, page 15

3.                                       Your
disclosure should state in future filings, whether there was any change in
internal control that materially affected, or were reasonably likely to
materially affect, your internal controls.
Please confirm in writing whether there was any change in your internal
controls over financial reporting identified in connection with an evaluation
thereof that occurred during the period covered by the above report that has
materially

3

affected, or
is reasonably likely to materially affect, your internal control over financial
reporting.  Please see Item 308(c) of
Regulation S-K.

Partnership’s Response:  The Partnership confirms that there has not
been any change in its internal control over financial reporting identified in
connection with an evaluation thereof that occurred during the period covered
by the Form 10-Q that has materially affected, or is reasonably likely to
materially affect, its internal control over financial reporting.  Pursuant to Item 308(c) of Regulation S-K,
and in response to your instructions, the Partnership’s future filings will
include disclosure consistent with the preceding sentence.

If you have any questions or comments regarding the Partnership’s
response to the staff’s comments or require additional information, please
contact me at the above phone number.

  Sincerely,

  /s/Aaron A.
  Ghais

  Aaron A.
  Ghais

cc:           Javier O. Lamoso

4