SEC Comment Letter for INTERNATIONAL BROADCASTING — Nov 8, 2005
INTERNATIONAL BROADCASTING CORP /NV/ (CIK 0001156390)
Date: Nov. 8, 2005 · CIK: 0001156390 · Accession: 0000000000-05-056828
AI Filing Summary & Sentiment
File numbers found in text: 333-67484
Referenced dates: July 27, 2005
Letter
November 4, 2005 Via U.S. Mail and Facsimile Daryn P. Fleming Chief Executive Officer, President, Treasur er, and Principal Executive Financial and Accounting Officer International Broadcasting Corporation 5100 N. 27th Street, Suite A-2 Lincoln, NE 68521
RE: International Broadcasting Corporation Form 10-KSB for the Fiscal Year Ended December 31, 2004 Form10-QSB for the quarterly period ended March 31, 2005 Form10-QSB for the quarterly period ended June 30, 2005 File No. 333-67484
Dear Mr. Fleming:
We have reviewed your response letter dated July 27, 2005 and have the following comments. Where indicated, we think you should revise your document in response to these comments and comply with the remaining comments in all future filings. If you disagree, we will consider your explanation as to why our comment is inapplicable or a revision is unnecessary. Pl ease be as detailed as necessary in your explanation. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure. After reviewing this information, we may raise additional comments.
We look forward to working with you in these respects. We welcome any questions you may have about our comments or any other aspect of our review. Feel free to call us at the telephone numbers lis ted at the end of this letter.
Daryn P. Flem ing International Broadcasting Corporation November 4, 2005 Page 2
Form 10-KSB for the Fiscal Year Ended December 31, 2004
Note 2. Summary of Significant Accounting Policies
G. Loss per Common Share, page F-7
1. We note your response to our prior comme nt 3. Your statement that “the Company does not have any outstanding secu rities that could pot entially be anti- dilutive to basic EPS in the future” is in consistent with your disclosure in Note 2.G and with the fact that you have out standing warrants as described in your response to our prior comment 8. As suc h, as requested in our prior comment 3 revise future filings to disclose those securities (including those issuable upon exercise of options or warrants) that could potentially dilute basic EPS in the future that were note included in the com putation of diluted EPS (as disclosed in your Note 2.G) because to due so would have been anti-dilutive for the periods presented. Please refer to the requirem ents in paragraph 40 of SFAS No. 128.
H. Marketable Securities, page F-7
2. We note your response to our prior comme nt 4 and your revised disclosure in your Form 10-QSB for the quarterly period ended June 30, 2005. Along with those disclosures, please include in one f ootnote the aggregate fair value, the total gain for securities with net gains in accumulated other comprehensive income, and the total losses for securities with net losses in accumulated other comprehensive income, by major type of security as required by paragraph 19 of SFAS No.115. Additionally, in the same footnote disclose the information required by paragraph 21(a), (b) and (d ) of SFAS No. 115. Also if applicable, provide in the same footnote the disclosu re requirements in paragraph 20 of SFAS No. 115.
Form 10-QSB for the Quarterly Period Ended March 31, 2005 Form 10-QSB for the Quarterly Period Ended June 30, 2005 Note 4. Barter Transactions
3. We note from your response to our prior co mment 7 and your disclosure that “the amount of barter revenue and expense is r ecorded at the estimated fair value of the services received or the service provided, whichever is more objectively determinable.” We remind you that pa ragraph 4 of EITF 99-17, states “that revenue and expense should be recognized at fair value from an advertising barter transaction only if the fair value of the advertising surrendered in the transaction is determinable based on the entity’s own historical practi ce of receiving cash, marketable securities, or consideration that is read ily convertible to a known amount of cash for similar advertising fr om buyers unrelated to the counterparty in the barter transaction.” In this regard, pl ease confirm to us that you follow all
Daryn P. Flem ing International Broadcasting Corporation November 4, 2005 Page 3
the criteria in EITF 99-17 when determin ing whether or not you should recognize revenue and expense as it rela tes to your advertising bart er transactions and revise your disclosure to reflect your policy in detail citied by the guidance in EITF 99- 17. If you recognized advertising barter revenue and expense on another basis that is not in compliance with paragra ph 4, 5, 6, and 7 of EITF 99-17(as currently disclosed in your Form 10-QSB for the quarterly period ended March 31, 2005 and June 30, 2005), please revise your fi nancial statements to comply with the guidance in EITF 99-17. Additionally, pleas e revise your disclosures to describe the methods and periods used to recognize the advertising revenue associated with your deferred barter revenue and the expens e associated with the deferred barter credits. Also we note from your revised disclosure that expenses incurred in generating barter revenue are an offset to barter revenue in your financial statements. In this regard, explain to us your basis for concluding that the expense incurred in generating barter re venue should be an offset to barter revenue, cited with supporting facts in EITF 99-17 and 99-19. Furthermore, as requested in our prior comment 7, please tell us if you engage in advertising barter transactions for which the fair valu e is not determinable within the limits of EITF 99-17. Please note that if you engage in such advertising barter transactions, information regarding the volume and t ype of advertising surrendered and received (such as the number of equivale nt pages, the number of minutes, or the overall percentage of advertising volu me) should be disclose for each period a statement of operations is presented. Finally, along with disclosing the amount of advertising barter revenue, please disclose in your financial statements the expense recognized from advertising barter transactions for each income statement period presented. In this re gard, you should disclose separately the expense associated with the amortization of your deferred bart er credits and your expense incurred in generating barter reve nue. As part of your response, please provide us with your proposed disclosure.
As appropriate, please amend your filing and respond to these comments within 20 business days or tell us when you will provid e us with a response. You may wish to provide us with marked copies of the amendm ent to expedite our review. Please furnish a cover letter with your amendment that keys your responses to our comments and provides any requested information. Detailed co ver letters greatly faci litate our review. Please understand that we may have addi tional comments after reviewing your amendment and responses to our comments.
You may contact Jeff Jaramillo at (202) 551-3212 or Linda Cvrkel, Branch Chief, at (202) 551-3813 if you have questions rega rding comments on the financial statements and related matters. Please contact Max Webb, Assistant Direct or, at (202) 551-3755 with any other questions.
Daryn P. Flem ing International Broadcasting Corporation November 4, 2005 Page 4
Sincerely,
Joe Foti
Senior Assistant Chief Accountant
Show Raw Text
Mail Stop 3561
November 4, 2005
Via U.S. Mail and Facsimile
Daryn P. Fleming
Chief Executive Officer, President, Treasur er, and Principal Executive Financial and
Accounting Officer
International Broadcasting Corporation
5100 N. 27th Street, Suite A-2
Lincoln, NE 68521
RE: International Broadcasting Corporation
Form 10-KSB for the Fiscal Year Ended December 31, 2004
Form10-QSB for the quarterly period ended March 31, 2005
Form10-QSB for the quarterly period ended June 30, 2005
File No. 333-67484
Dear Mr. Fleming:
We have reviewed your response letter dated July 27, 2005 and have the
following comments. Where indicated, we think you should revise your document in
response to these comments and comply with the remaining comments in all future
filings. If you disagree, we will consider your explanation as to why our comment is
inapplicable or a revision is unnecessary. Pl ease be as detailed as necessary in your
explanation. In some of our comments, we may ask you to provide us with information
so we may better understand your disclosure. After reviewing this information, we may
raise additional comments.
We look forward to working with you in these respects. We welcome any
questions you may have about our comments or any other aspect of our review. Feel free
to call us at the telephone numbers lis ted at the end of this letter.
Daryn P. Flem ing
International Broadcasting Corporation
November 4, 2005
Page 2
Form 10-KSB for the Fiscal Year Ended December 31, 2004
Note 2. Summary of Significant Accounting Policies
G. Loss per Common Share, page F-7
1. We note your response to our prior comme nt 3. Your statement that “the
Company does not have any outstanding secu rities that could pot entially be anti-
dilutive to basic EPS in the future” is in consistent with your disclosure in Note
2.G and with the fact that you have out standing warrants as described in your
response to our prior comment 8. As suc h, as requested in our prior comment 3
revise future filings to disclose those securities (including those issuable upon
exercise of options or warrants) that could potentially dilute basic EPS in the
future that were note included in the com putation of diluted EPS (as disclosed in
your Note 2.G) because to due so would have been anti-dilutive for the periods
presented. Please refer to the requirem ents in paragraph 40 of SFAS No. 128.
H. Marketable Securities, page F-7
2. We note your response to our prior comme nt 4 and your revised disclosure in
your Form 10-QSB for the quarterly period ended June 30, 2005. Along with
those disclosures, please include in one f ootnote the aggregate fair value, the total
gain for securities with net gains in accumulated other comprehensive income,
and the total losses for securities with net losses in accumulated other
comprehensive income, by major type of security as required by paragraph 19 of
SFAS No.115. Additionally, in the same footnote disclose the information
required by paragraph 21(a), (b) and (d ) of SFAS No. 115. Also if applicable,
provide in the same footnote the disclosu re requirements in paragraph 20 of SFAS
No. 115.
Form 10-QSB for the Quarterly Period Ended March 31, 2005
Form 10-QSB for the Quarterly Period Ended June 30, 2005
Note 4. Barter Transactions
3. We note from your response to our prior co mment 7 and your disclosure that “the
amount of barter revenue and expense is r ecorded at the estimated fair value of
the services received or the service provided, whichever is more objectively
determinable.” We remind you that pa ragraph 4 of EITF 99-17, states “that
revenue and expense should be recognized at fair value from an advertising barter
transaction only if the fair value of the advertising surrendered in the transaction
is determinable based on the entity’s own historical practi ce of receiving cash,
marketable securities, or consideration that is read ily convertible to a known
amount of cash for similar advertising fr om buyers unrelated to the counterparty
in the barter transaction.” In this regard, pl ease confirm to us that you follow all
Daryn P. Flem ing
International Broadcasting Corporation
November 4, 2005
Page 3
the criteria in EITF 99-17 when determin ing whether or not you should recognize
revenue and expense as it rela tes to your advertising bart er transactions and revise
your disclosure to reflect your policy in detail citied by the guidance in EITF 99-
17. If you recognized advertising barter revenue and expense on another basis
that is not in compliance with paragra ph 4, 5, 6, and 7 of EITF 99-17(as currently
disclosed in your Form 10-QSB for the quarterly period ended March 31, 2005
and June 30, 2005), please revise your fi nancial statements to comply with the
guidance in EITF 99-17. Additionally, pleas e revise your disclosures to describe
the methods and periods used to recognize the advertising revenue associated with
your deferred barter revenue and the expens e associated with the deferred barter
credits. Also we note from your revised disclosure that expenses incurred in
generating barter revenue are an offset to barter revenue in your financial
statements. In this regard, explain to us your basis for concluding that the
expense incurred in generating barter re venue should be an offset to barter
revenue, cited with supporting facts in EITF 99-17 and 99-19. Furthermore, as
requested in our prior comment 7, please tell us if you engage in advertising
barter transactions for which the fair valu e is not determinable within the limits of
EITF 99-17. Please note that if you engage in such advertising barter transactions,
information regarding the volume and t ype of advertising surrendered and
received (such as the number of equivale nt pages, the number of minutes, or the
overall percentage of advertising volu me) should be disclose for each period a
statement of operations is presented. Finally, along with disclosing the amount
of advertising barter revenue, please disclose in your financial statements the
expense recognized from advertising barter transactions for each income
statement period presented. In this re gard, you should disclose separately the
expense associated with the amortization of your deferred bart er credits and your
expense incurred in generating barter reve nue. As part of your response, please
provide us with your proposed disclosure.
As appropriate, please amend your filing and respond to these comments within
20 business days or tell us when you will provid e us with a response. You may wish to
provide us with marked copies of the amendm ent to expedite our review. Please furnish
a cover letter with your amendment that keys your responses to our comments and
provides any requested information. Detailed co ver letters greatly faci litate our review.
Please understand that we may have addi tional comments after reviewing your
amendment and responses to our comments.
You may contact Jeff Jaramillo at (202) 551-3212 or Linda Cvrkel, Branch Chief,
at (202) 551-3813 if you have questions rega rding comments on the financial statements
and related matters. Please contact Max Webb, Assistant Direct or, at (202) 551-3755
with any other questions.
Daryn P. Flem ing
International Broadcasting Corporation
November 4, 2005
Page 4
Sincerely,
Joe Foti
Senior Assistant Chief Accountant
Via facsimile: Daryn P. Fleming, Chief Executive Officer
(509) 357-7111