-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, K22GL8NBKTxhoHzZG/4nFsYIFCXHElCNkruwZxpyd3GQCRStNs5aj+IcVW1VzSdb Xj8SgWDEXw0bYuEqOhFsMg== 0001477932-10-000134.txt : 20100422 0001477932-10-000134.hdr.sgml : 20100422 20100308141834 ACCESSION NUMBER: 0001477932-10-000134 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20091230 ITEM INFORMATION: Changes in Registrant's Certifying Accountant ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20100308 DATE AS OF CHANGE: 20100308 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RELIABILITY INC CENTRAL INDEX KEY: 0000034285 STANDARD INDUSTRIAL CLASSIFICATION: INSTRUMENTS FOR MEAS & TESTING OF ELECTRICITY & ELEC SIGNALS [3825] IRS NUMBER: 750868913 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-07092 FILM NUMBER: 10663213 BUSINESS ADDRESS: STREET 1: 16400 PARK ROW STREET 2: P O BOX 218370 CITY: HOUSTON STATE: TX ZIP: 77218-8370 BUSINESS PHONE: 281-492-0550 FORMER COMPANY: FORMER CONFORMED NAME: FAIRLANE INDUSTRIES INC DATE OF NAME CHANGE: 19800519 8-K/A 1 f8ka123009_reliability.htm FORM-8K/A f8ka123009_reliability.htm


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20459
 
FORM 8-K/ A
 
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 
Date of report (Date of Earliest Event Reported): December 30, 2009
 
 RELIABILITY INCORPORATED
 (Exact name of Registrant as specified in its charter)
 
 
Texas
 
0-7092
 
75-0868913
(State or other jurisdiction
of incorporation)
 
(Commission File
Number)
 
(IRS Employer
Identification No.)

 
410 Park Avenue--15th Floor   New York, New York    10022
(Address of principal corporate offices)                        (Zip Code)
 
Registrant’s telephone number, including area code: (212) 231-8359
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions ( see  General Instruction A.2. below):

o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 4.01      Changes in Registrant’s Certifying Accountant
 
On December 30, 2009, Reliability Incorporated (the “Company”) announced that the Board of Directors of the Company by mutual consent had terminated the appointment of Schumacher & Associates, Inc (“Schumacher”) as independent certifying accountants of the Company, and appointed the firm of Ramirez International Financial & Accounting Services, Inc. (“Ramirez International”) as the new independent certifying accountants of the Company.   In response to a February 22, 2010 Staff comment letter, this Form 8-K/A is being filed to upgrade the Company’s prior disclosure.
 
The Company stated in its December 30, 2009 Form 8-K that, during its two most recently completed fiscal quarters ended June 30 and September 30, 2009 and through the termination date of December 30, 2009, there was a single disagreement with Schumacher  relating to whether the Company should be filing as a development stage company.


Schumacher believed that the Company may be a development stage company and suggested contacting the  SEC for guidance. .  If this method had been followed, the effect on the financial statements would be the presentation of   cumulative balances from the date the Company would have become a development stage Company and footnote disclosure .    The issue arose during the Company’s third quarter, the period ended September 30, 2009. The Company became a shell when it sold its then primary business in 2008. The Company had concluded, in its Form 10 -K disclosure for the period ended December 31, 2008 that, “... it should sell the Company or identify a merger partner. There can be no assurances that the Company will be successful in completing such a transaction or be able to maintain sufficient liquidity over a period of time that will allow it to carry out this action, in which case the Company might be forced to dissolve or seek protection under the Federal bankruptcy statutes, or both...” Based on these circumstances and FASB pronouncements (as well as the advice of an outside consultant), the Board of Directors believed and continues to believe the Company is not a development stage company and no additional disclosures are necessary.

With respect to the above disagreement, the Board of Directors discussed the subject matter of the disagreement with the former accountants Schumacher and authorized them to respond fully to the inquires of the successor accountants concerning the subject matter of the disagreement.

The disagreement was considered by the Company’s Board of Directors and, as part of that consideration, provided Schumacher with a copy of this amended disclosure and requested that it furnish the Company with a letter addressed to the Securities and Exchange Commission stating whether or not it agrees with the above statements.  A copy of such updated letter is attached hereto as Exhibit 16.1 to this Current Report on Form 8-K/A.
Item 9.01.     Financial Statements and Exhibits.
 
16.1 
Updated Letter from Auditors 
 
2

 
 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
RELIABILITY INCORPORATED
 
       
Dated: March 8 , 2010
By:
/s/ Jay Gottlieb
 
   
Jay Gottlieb
 
   
Chairman of the Board, Secretary and Treasurer
 
       

 
3

 
EX-16.1 2 ex16_1.htm CERTIFICATE ex16_1.htm
 
EXHIBIT 16.1

 
 
 SCHUMACHER & ASSOCIATES, INC.
Certified Public Accountants
7931 S. Broadway, #314
Littleton, CO 80122
(303) 480-5037 FAX (303) 379-5394
 
March 5, 2010
 
United States Securities and Exchange Commission Mail Stop 11-3
450 Fifth Street, N. W.
Washington D.C. 20549
 
Re:            Reliability Incorporated Dear Sirs/Madams:
The undersigned Schumacher & Associates, Inc. previously acted as independent accountants to audit the financial statements of Reliability Incorporated. We are no longer acting as independent accountants to the Company.
 
This letter will confirm that we have read Reliability Incorporated's statements included under Item 4 of its Form 8-K filed on or about March 5, 2010, and we agree with such statements as they relate to us, except that we have no basis to agree or disagree with the statement regarding the board's approval to dismiss our firm, and with the other statements of the Company in the remainder of the Current Report on Form 8-K.
 
We hereby consent to the filing of this letter as an exhibit to the foregoing report on Form 8-K.
 
 
 
Very truly,  
   
 
Schumacher & Associates, Inc.  
   
 
 
 
 



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CARL N. DUNCAN, ESQ., LLC
ATTORNEY AT LAW
cduncan@cnduncanlaw.com

5718 Tanglewood Drive  (301) 263-0200
Bethesda, Maryland  20817  Fax (301) 576-5193
 
March 8, 2010

VIA MESSENGER AND EDGAR FILING AS CORRESPONDENCE

David Burton, Staff Accountant
U.S. Securities and Exchange Commission
Division of Corporation Finance
Mail Stop 3030
Washington, D.C. 20549

Re:           Reliability Incorporated (“REAL”); File No. 0-07902 REAL Form 8-K/A Filed February 19, 2010 Relating to Item 4.01

Dear Mr. Burton:

This letter is in response to the comments of the Division of Corporation Finance staff (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”) with respect to the above-referenced filing of Reliability Incorporated (“REAL” or the “Company”) as set forth in your comment letter dated February 22, 2010 (the “Comment Letter”).  The Company hereby responds to each of the Staff’s outstanding Comments.

For the convenience of the Staff, we have reproduced the Staff’s comments from the Comment Letter in Italics.  The responses to those Comments immediately follow the reproduced Staff comments.  The Form 8-K/A referred to herein is being filed concurrently on EDGAR.  By way of background (and as reflected in the prior auditor’s letter dated December 30, 2009 and February 19, 2010 and appended to REAL’s respective Form 8-K/A), there were no further disagreements with Schumacher on accounting principle or practice, financial statement disclosure, auditing scope or procedure.

Form 8-K/A dated December 30, 2009

Item 4-01.  Changes in Registrant’s Certifying Accountant

1.
We note the additional language provided in the third paragraph in response to prior comment 1.  However, such information does not address the disclosure requirements of Item 304(a)(1)(iv) of Regulation S-K for statements (B) and (C).  Specifically, state whether your board of directors discussed the subject matter of the disagreements with the former accountant: and state whether you authorized the former accountant to respond fully to the inquiries of the successor accountant concerning the subject matter of the disagreement and if not, describe the nature of any limitation thereon and the reason therefore.  Please amend your report to include these disclosures.
 
1


David Burton
United States Securities and Exchange Commission
Division of Corporation Finance
Page 2  
March 8, 2010
 
Response to Comment 1: The requested revisions have been incorporated into the REAL Form 8-K/A being filed concurrently.
 
2.
Please refer to prior comment 2.  Although you state the existence and nature of the disagreement, there was no statement made as to the effect on the financial statements if the method had been followed which the former accountant apparently would have concluded was required.  Please refer to Item 304(b) of Regulation S-K and amend your report to include this disclosure.

Response to Comment 2:  The requested revisions have been incorporated into the REAL Form 8-K/A being filed concurrently.

3.
To the extent that you amend the Form 8-K to comply with our comments, pleaser obtain and file an Exhibit 16 letter from the former accountant stating whether the accountant agrees with your Item 304 disclosures, or the extent to which the accountant does not agree.

Response to Comment 3:   The updated Accountant’s Letter is appended to this Form 8-K/A as Exhibit 16.1.

We appreciate your consideration of this matter and trust the Staff has no further comments, believing as we do that this response and the associated Form 8-K/A are fully responsive to the issues posed.  We, of course, stand ready to respond to any further questions you may have and/or if you require additional information.
 
 
Sincerely,

/s/ Carl N. Duncan

Carl N. Duncan
 
cc:           Jay Gottlieb
Gregg Schneider
Michael C. Pearce
Dave Sherwood
Mick Schumacher/Lois Huston

2



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