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CORRESP
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MAXIMUS

11419 Sunset Hills Road

Reston VA 20190

June 18, 2010

United
States Securities and Exchange Commission

Division
of Corporate Finance — Mail Stop 3010

Washington
DC 20549

Dear
Ms. Monick,

In
response to your letter of June 3, 2010, our responses are below.

In
addition, we acknowledge that:

  ·

  The Company is responsible
  for the adequacy and accuracy of the disclosure in the filing;

  ·

  Staff comments or changes
  to disclosure in response to staff comments do not foreclose the Securities
  and Exchange Commission from taking any action with respect to the filing;

  ·

  The Company may not assert
  staff comments as a defense in any proceeding initiated by the Securities and
  Exchange Commission or any person under the federal securities laws of the
  United States.

Note
13, Shareholders’ Equity

We
note you corrected an error related to stock-based compensation expense.  Please tell us how you have complied with ASC
250.

We
note your response to prior comment three and request that you provide us with
a more robust analysis of materiality related to the $2.2 million stock-based
compensation charge recorded during the first quarter of fiscal 2008.  In your response, please provide us with a
thorough materiality analysis which is performed at the segment level and which
addresses the impact to both income from continuing operations and net
income.  Additionally, help us to
understand what you, your investors and analysts were focusing on during the
earnings calls during 2007 and 2008.
Please tell us if the focus was on earnings including or excluding these
“unusual and infrequently occurring items.”
Your response should include excerpts from your earnings calls.  Finally, provide us with samples of analysts’
reports for 2007, 2008 and 2009 and be sure to provide samples from quarters
that were most relevant to the $2.2 million adjustment.

1

Analysis of materiality

In
providing a more robust analysis of the materiality of the charge, we will
provide certain information from our previous submission for ease of review.

In
correcting the stock based compensation in 2008, management considered the
effect of the Stock-Based Compensation Adjustments (“SBC Adjustments”) on the
financial results for 2006, 2007 and 2008, as well as the effects of the SBC
Adjustments on the trend of earnings and other factors.  In performing this evaluation, management
also considered the effects of the SBC Adjustments on the results as stated for
the business as a whole.    The SBC
Adjustments were recorded in the first quarter of fiscal year 2008.  The Company’s Systems segment was
discontinued in the fourth quarter of fiscal 2008.  Since the correction occurred prior to the
discontinued operations of the Systems segment, management based its judgment
on materiality upon the financial information that existed prior to the
financials being recast for discontinued operations.  Appendix 1 shows the SBC Adjustments by
segment both before and after the discontinued operations recast the financial
results.  In the appendices to this
letter, we provide financial and segment analysis relative to the SBC
Adjustments as if the Systems segment was not discontinued.  We have also provided the SBC Adjustments
relative to continuing operations, which reflects the SBC Adjustments and
segment information after the financials were recast for the discontinued
operations.

In
performing the evaluation, management concluded that the SBC Adjustments were
not material to any of the periods affected.
This is true with or without the decision in fiscal year 2008 to
discontinue the systems segment.

That
evaluation included consideration of the guidance related to materiality
included in ASC 250-10-S99 (SAB Topic 1.M).
In conjunction with that guidance, we considered both the quantitative
and qualitative factors in concluding that the amounts were not material.

Quantitatively,
we considered the following when reviewing the SBC Adjustments relative to
consolidated results:

·                  We compared the
SBC Adjustments to the revenue and income to determine materiality.  During the years affected by the SBC
Adjustments, management and industry analysts adjusted income for certain
unusual and infrequently occurring items.
Appendix 6 provides the components of these unusual and infrequent
adjustments and operating income trends without these items.  The primary driver for the adjustments was
the economic impact of an unfavorable contract with Accenture to provide
services to the Texas HHSC.  This subcontract
generated large losses and a write-off of deferred contract costs.  The Accenture subcontract was terminated
during the second quarter of fiscal 2007 and became a legal matter.  The work performed under this subcontract was
replaced with a new contract that the Company entered into directly with the
State of Texas, which returned the operations to profitability in the third
quarter of fiscal 2007.    The Accenture
subcontract was a major driver of the legal and settlement expense.  The subcontract and its related litigation
represented a significant contingency to the Company and was a major focus of
industry analysis aside from the

2

Company’s
core business operations.  In addition,
during these years, the Company reached a large settlement with the Department
of Justice and realized a gain on the sale of an owned office building.  These items were separately identified in
their relevant periods, with their effects on operating income and EPS
communicated to the public.  When
management and industry analysts evaluated the Company’s performance and
assessed its future prospects, it was done by adjusting income for these
unusual and infrequently occurring items and then separately identifying and
evaluating the Texas subcontract contingency.
Accordingly, in our analysis, we have adjusted income from continuing
operations in each period to reflect these items.

·                  Prior to the
problems under the Texas subcontract, the Company had never recorded a loss as
a public company and had recorded net income in excess of $35 million in each
of the five fiscal years prior to 2006.
Similarly, the Company returned to its previous high levels of
profitability in fiscal 2009 and YTD fiscal 2010.  The SBC Adjustments as a percentage of
historical results would also not be material.
Management’s adjustments for unusual and infrequent events, when
adjusted out from net income, would show the Company recording levels of income
consistent with those both prior to fiscal 2006 and subsequent to fiscal
2008.   For this reason, management
considers this adjusted income to be a more appropriate basis for measuring
materiality, based upon the focus of the analysts and investor community on the
adjusted results.

·                  We compared the
SBC Adjustments to the revenue and income of the business as recorded in 2006
and 2007 prior to the discontinued operations and to the 2008 financial results
as they would have been stated if we did not recast our financials for
discontinued operations. As noted above, at the time of the correction, these
were the basis for management’s assessment of materiality.  This analysis of SBC Adjustments compared to
financial results prior to recasting for the discontinued operations is
provided in Appendix 2.  In no year do
the SBC Adjustments exceed 0.3% of revenue, or 3.5% of adjusted income. Based
upon this analysis, we do not consider the SBC Adjustments to be material.

·                  Management
compared the SBC Adjustments to revenue, income from continuing operations and
net income based upon the financial results of the business following
discontinued operations at the end of 2008.
Those financial results were disclosed in our Annual Report on Form 10-K
for the year ended September 30, 2008, filed with the SEC on December 15,
2008.  The analysis is summarized on
Appendix 3.  In no year do the SBC
Adjustments exceed 0.3% of revenue, or 3% of adjusted income from continuing
operations.  In addition, the
tax-effected SBC Adjustments never exceed 5% of net income. Based upon this
analysis, we do not consider the SBC Adjustments to be material.

Quantitatively,
we considered the following when reviewing the SBC Adjustments relative to segment
results:

3

·                  The segment
analysis at Appendix 4 is prepared as if we did not recast our financials for
discontinued operations, consistent with the analysis provided at Appendix
2.  The segment analysis provided at
Appendix 5 is prepared consistent with fiscal 2008 year-end financials that
treat the systems segment as discontinued.
Appendix 5 is prepared on a basis consistent with Appendix 3.  When evaluating segment information,
management concluded that the SBC Adjustments were not material to any of the
periods affected.  This is true with or
without the decision in fiscal year 2008 to discontinue the Systems segment.

·                  For all
segments, relative to all years, the effects of the SBC Adjustments are less
than 1% of revenue.  This calculation is
shown at Appendixes 4 and 5.  Based upon
this segment analysis, we do not consider the SBC Adjustments to be material.

·                  The Operations
Segment is the dominant segment by either revenue or operating income
measures.  The SBC Adjustments for this
segment range between 1.0% and 2.1% of operating income adjusted for the Texas
subcontract.  Based upon this segment
analysis, we do not consider the SBC Adjustments to be material to the
operating income for the Operations segment.

·                  In all years,
the Systems segment recorded a loss and in certain periods operated at
near-breakeven.  Accordingly, it would be
inappropriate to use operating profit as a measure of materiality.  In no year do the SBC Adjustments change the
loss to profit.  Based upon this segment
analysis, we do not consider the SBC Adjustments to be material to the
operating income for the Systems segment.
The Systems segment was discontinued in the fiscal year in which the
correction was made.  Accordingly, it is
included in discontinued operations and had no impact to continuing operations.

·      The impact the SBC Adjustments had on the Consulting segment in
fiscal year 2007 was less than 5% of operating income and was immaterial.  For fiscal year 2006, prior to the recast
detailed on Appendix 4, the effect of the SBC Adjustments would have been less
than 5% of operating income.  Similarly,
fiscal year 2008, prior to the recast, had an operating loss and is an
inappropriate measure for materiality and the adjustment would not change the
perception held by shareholders or the investment community that the segment
results were marginal. Since the correction occurred prior to the discontinued
operations of the Systems segment, management based its judgment on materiality
upon financial information prior to the financials being recast.  The effect of the SBC Adjustments on
Consulting segment profit margin after discontinuing the Systems segment would
be to reduce fiscal 2006 margin by 0.3% to 3.9% and increase the fiscal 2008 margin
by 0.6% to 1.8%.  Management believes
that a reader of the financial statements will still view the SBC Adjustments
as immaterial to the Consulting segment.
Based upon this segment analysis, we do not consider the SBC Adjustments
to be material to the operating income for the Consulting segment.

As
part of the qualitative analysis, we considered the following:

4

·                  The SBC
Adjustments do not significantly change, or mask changes, in earnings or other trends
at the consolidated or segment level.

·                  Analysts
historically review results adjusted for certain items discussed above and the
SBC Adjustments would not impact their assessments.

·                  The SBC
Adjustments would not move the Company between income or loss in any periods
affected.

·                  The SBC
Adjustments do not affect any compliance matters, including compliance with
debt covenants.

·                  The SBC
Adjustments do not affect management compensation and represent a non-cash
item.

·                  The SBC
Adjustments do not represent any unlawful or fraudulent transactions.

Upon
our conclusion that the amounts were not material, we considered the guidance
of ASC 250-10-S99-3 related to immaterial adjustments.  The example in SAB Topic 5.F. states that, if
an accounting change does not have a material impact in the financial
statements, the cumulative effect of the change should be included in the
income statement for the period in which the change is made.  In accordance with that guidance, the full
amount of the change is reflected in the period in which it was made.

Finally,
we note that the SBC Adjustments and their correction were fully and
appropriately disclosed in the footnotes to our financial statements allowing
the user of the statements complete transparency into our operating
results.  In our Annual Reports on Form 10-K,
the SBC Adjustments are disclosed in Note 13 (page 55 of the 2009 10-K and
page 51 of the 2008 10-K) as well as within the MD&A (page 21 in
2009, page 20 in 2008).  In our
Quarterly Reports on Form 10-Q for 2008, the SBC Adjustments are disclosed
in the MD&A on page 15 of Q1 and Q2 and page 18 of Q3.

The focus of 2007 and 2008 earnings calls

During
earnings calls and other communications to shareholders and analysts during
2007 and 2008, significant focus was placed upon the unusual and infrequently
occurring items.  This information is of
significant value to these parties in assessing the past performance of
management and assessing the likely future prospects of the Company.  The breakdown of these charges (after-tax)
was as follows:

5

  2006

  Q1

  Q2

  Q3

  Q4

  Total

  Texas
  Contract

  —

  1,392

  20,754

  7,742

  29,887

  Legal
  and Settlement Expense

  303

  439

  5,492

  (550

  )

  5,683

  2007

  Q1

  Q2

  Q3

  Q4

  Total

  Texas
  Contract

  16,940

  3,933

  —

  (5,627

  )

  15,246

  Legal
  and Settlement Expense

  1,815

  3,691

  19,965

  1,414

  26,885

  2008

  Q1

  Q2

  Q3

  Q4

  Total

  Legal
  and Settlement Expense

  —

  563

  423

  22,221

  23,207

  Gain on Sale
  of Building

  —

  —

  (2,382

  )

  —

  (2,382

  )

  Goodwill
  impairment charge

  —

  —

  —

  4,598

  4,598

  2009

  Q1

  Q2

  Q3

  Q4

  Total

  Legal
  and Settlement Expense

  —

  —

  (4,271

  )

  —

  (4,271

  )

·                  In all quarters
in 2007 and in the latter quarters of 2006 and 2008, the Company included an
analysis of “Supplemental Pro Forma Information” which adjusted the financial
results of the Company from GAAP to an adjusted result excluding the effects of
the Texas Project, Legal and Settlement Expense, the gain on sale of a Company
building, and a goodwill write-off.  This
was typically referred to as “adjusted” EPS or adjusted income before income
taxes.

·                  During 2007,
the Company frequently referred to “Base Operations” in press releases and
earnings calls.  Base Operations was
defined as the Company’s financial results, excluding losses on the Texas
Project and legal expenses.  This term is
also used by certain analysts in assessing the results of the business.

·                  A summary of
this supplemental information by fiscal year is provided at Appendix 6.

Specific
quarterly matters are noted below:

Second
Quarter 2006 (March 31, 2006)

·                  The company’s
earnings press release, issued on May 3, 2006  and filed as Exhibit 99.1 on Form 8-K
on May 5, 2006, mentions losses in Texas and British Columbia.  In addition, the transcript of the subsequent
conference call was filed as Exhibit 99.2 in the same Form 8-K.  The Texas subcontract is mentioned in both
the press release and the call (“In the current quarter our Texas