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Mail Stop 6010
October 7, 2005
Mr. Martin B. Bloch
President and Chief Executive Officer
Frequency Electronics, Inc.
55 Charles Lindbergh Boulevard
Mitchel Field, New York 11553
RE: Frequency Electronics, Inc.
Form 10-K for the fiscal year ended April 30, 2005
Filed July 28, 2005
File No. 1-08061
Dear Mr. Bloch:
We have reviewed your filing and have the following
comments.
We have limited our review of your filing to those issues we have
addressed in our comments. Where indicated, we think you should
revise your document 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 information so we may better understand
your
disclosure. After reviewing this information, we may 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 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.
FORM 10-K for the period ending April 30, 2005
Consolidated Statement of Operations - page 30
1. In future filings, please present the compensation charges in
cost
of sales, selling and administrative expenses and other major line
items, after appropriate allocation. We would not object if you
show
a parenthetical inclusion. Refer to SAB Topic 14(F).
Notes to Financial Statements - page 34
Note 4 Inventories - page 38
2. In future filings, please disaggregate Work in Progress from
Finished Goods in your inventory footnote disclosure. Refer to
Rule
5-02(6)(a) of Regulation S-X.
Note 6 Property, Plant and Equipment - page 39
3. We refer to the sale of the Long Island building to Reckson
Associates Realty Corp in exchange for approximately 513,000
participation units of Reckson Operating Partnership, L.P. Please
tell us in detail the accounting for all aspects of this
transaction,
including the conversion of the REIT units and recognition of the
deferred gain. In your response please show your calculations and
tell us how you determined the fair market value. Please cite
appropriate GAAP literature to support your accounting.
Note 10 Investment in Morion, Inc. - page 41
4. Since it appears in 2004 your equity in the income from your
investment in Morion exceeded 20% of your 2004 income from
continuing
operations before taxes, extraordinary items and cumulative effect
of
a change in accounting principle, it appears to us you are
required
to include Rule 3-09 of Regulation S-X financial statements for
this
investee in your Form 10-K. Please file an amended 2005 Form 10-K
with all required financial statements or tell us why you believe
no
such amendment is necessary. Also, note that your future Form 10-
Q`s
should include the disclosure required by Item 4-08(g) of
Regulation
S-X for any significant equity investees.
Note 13 Employee Benefit Plans - page 42
Deferred Compensation Plan - page 45
5. During the year 2005, the Company recorded a $327,000 change in
accounting estimate reflecting the use of updated actuarial
mortality
tables to determine its deferred compensation liability. Please
tell
us in detail the circumstances surrounding this adjustment.
Specifically, discuss the facts and circumstances that support the
timing of the referenced change in estimate.
General Comment
6. Please comply with our futures comments in any amendment
required
in response to this comment letter.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing 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.
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 with your response that keys your
responses to our comments and provides any requested 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.
You may contact Dennis Hult, Staff Accountant, at (202) 551-
3618 or myself if you have questions regarding comments on the
financial statements and related matters. Please contact me at
(202)
551-3603 with any other questions. In this regard, do not
hesitate
to contact Angela J. Crane, Accounting Branch Chief, at (202) 551-
3554.
Sincerely,
Jay Webb
Reviewing Accountant
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Martin B. Bloch
Frequency Electronics, Inc.
October 7, 2005
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