<SEC-DOCUMENT>0001144204-18-001918.txt : 20180214
<SEC-HEADER>0001144204-18-001918.hdr.sgml : 20180214
<ACCEPTANCE-DATETIME>20180111162137
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0001144204-18-001918
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20180111

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			Consolidated Water Co. Ltd.
		CENTRAL INDEX KEY:			0000928340
		STANDARD INDUSTRIAL CLASSIFICATION:	WATER SUPPLY [4941]
		IRS NUMBER:				000000000
		STATE OF INCORPORATION:			E9
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		REGATTA OFFICE PARK, WINDWARD THREE,
		STREET 2:		4TH FLOOR, WEST BAY ROAD, P.O. BOX 1114
		CITY:			GRAND CAYMAN
		STATE:			E9
		ZIP:			KY1-1102
		BUSINESS PHONE:		345-945-4277

	MAIL ADDRESS:	
		STREET 1:		REGATTA OFFICE PARK, WINDWARD THREE,
		STREET 2:		4TH FLOOR, WEST BAY ROAD, P.O. BOX 1114
		CITY:			GRAND CAYMAN
		STATE:			E9
		ZIP:			KY1-1102

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CONSOLIDATED WATER CO LTD
		DATE OF NAME CHANGE:	19990330

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CAYMAN WATER CO LTD
		DATE OF NAME CHANGE:	19941212
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>CONSOLIDATED WATER CO. LTD.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">The Regatta Office Park</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">Windward Three, 4<SUP>th</SUP> Floor</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">West Bay Road, P.O. Box 1114</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">Grand Cayman, KY1-1102</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">Cayman Islands</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">(345) 945-4277</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">January 11, 2018</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I><U>VIA EDGAR AND FAX (202-772-9361)</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">United States Securities and Exchange Commission</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Division of Corporation Finance</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">100 F Street, N.E.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Washington, DC 20549-0405</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Attention: Mr. William H. Thompson, Accounting Branch Chief</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left"><B>Re:</B></TD><TD STYLE="text-align: justify"><B>Consolidated Water Co. Ltd.</B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; margin-left: 1in; text-indent: 0in; text-align: justify"><B>Form
10-Q for the Quarterly period Ended June 30, 2017</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; margin-left: 1in; text-indent: 0in; text-align: justify"><B>Response
Dated December 5, 2017</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; margin-left: 1in; text-indent: 0in; text-align: justify"><B>File
No. 0-25248</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Ladies and Gentlemen:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We are responding to
the comment of the staff (the &ldquo;Staff&rdquo;) of the U.S. Securities and Exchange Commission (the &ldquo;Commission&rdquo;)
to the above referenced filings as set forth in the Staff&rsquo;s letter dated December 13, 2017 (the &ldquo;Letter&rdquo;). For
your reference, we have included the comment in the Letter followed by our response.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><U>Financial Statements</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><U>3. Discontinued operations &ndash; CW
Bali, page 9</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">1.</TD><TD STYLE="text-align: justify">We read your response to comment two and also note you
recorded an additional impairment loss on CW-Bali&rsquo;s long-lived assets of $578,480 during the quarter ended September 30,
2017. Please explain why you have reflected an allowance for cumulative translation adjustment, representing the impairment loss
on long-lived assets, in other liabilities, on page 9 to your Form 10-Q for the quarter ended September 30, 2017. Please include
in your response the basis supporting your accounting.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Response:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Through early September
2017, we were negotiating the sale of CW-Bali to its sole remaining customer and we believed such sale would be consummated on
terms that would allow us to realize the net carrying value of our investment in CW-Bali as of June 30, 2017. However, in mid-September
2017, this customer communicated that it was no longer interested in purchasing either CW-Bali or its assets. During October 2017,
this customer filed a lawsuit in civil court in the city of Denpasar in Bali, Indonesia against CW-Bali, its President, and our
Chief Financial Officer in his capacity as the President of CW-Bali&rsquo;s Board of Commissioners (i.e. Directors). Until this
lawsuit is resolved we are legally prohibited from disposing of our investment in CW-Bali or any of CW-Bali&rsquo;s assets.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Given the change in
circumstances with respect to the possible disposition of CW-Bali, we deemed it appropriate to update our testing of further possible
impairment of our net investment in CW-Bali as part of our financial reporting process for the three months ended September 30,
2017. Such net investment consisted of the following components as of September 30, 2017:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 65%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 81%; font-size: 10pt; text-align: left">Cash and accounts receivable</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 15%; font-size: 10pt; text-align: right">171,205</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Plant equipment and related consumables inventories</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">249,638</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Cumulative translation adjustment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">578,480</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Current liabilities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(43,214</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">With respect to these
balances:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left">a)</TD><TD STYLE="text-align: justify">The cash and accounts receivables and current liabilities
were recorded at amounts that approximate fair value and these assets will be used or realized and these liabilities will be paid
in the course of business.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left">b)</TD><TD STYLE="text-align: justify">The plant equipment and related consumables inventories
balance of $249,638 relates to the carrying value, after impairment losses recorded in prior periods, of two of CW-Bali&rsquo;s
three reverse osmosis units and their accompanying consumable inventories. These two units are in excellent condition and as such
had been designated during the second quarter of 2017 for transfer along with their inventories to Grand Cayman Island for use
in our Cayman retail operations. Such transfer was completed in October 2017. The fair value of these assets as of September 30,
2017 exceeded their carrying value as a result of the previously recorded impairment losses.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left">c)</TD><TD STYLE="text-align: justify">Other than the assets discussed in paragraph b) above,
the carrying value of all of CW-Bali&rsquo;s other long-term assets had been reduced to zero as a result of the cumulative impairment
losses recorded for CW-Bali as of June 30, 2017.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left">d)</TD><TD STYLE="text-align: justify">Although the filing of the lawsuit against CW-Bali
precludes the presentation of CW-Bali as discontinued operations or its assets as &ldquo;held-for-sale&rdquo; due to the inability
to the meet the &ldquo;probable sale within one year&rdquo; criteria set forth in ASC 205-20-45-1E, we have committed to a plan
to dispose of CW-Bali either through sale or, if necessary, abandonment and are therefore required under ASC 830-30-45-13 to include
its cumulative translation adjustment as part of CW-Bali&rsquo;s carrying amount when evaluating this investment for possible
impairment.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Due to the loss of
this customer as a purchaser for CW-Bali and the uncertainties associated with the litigation initiated by this customer, we cannot
determine for what amount, if any, we will ultimately be able to sell CW-Bali&rsquo;s assets. We believe it probable that either
(i) any funds received from the sale of CW-Bali or its assets will not be material or (ii) we will ultimately abandon CW-Bali and
its assets. Accordingly, we deemed it appropriate to record an impairment loss to reduce that remaining portion of the carrying
value of our investment in CW-Bali that is subject to impairment testing (which as a result of impairment losses recorded in previous
periods consisted only of the cumulative translation adjustment of $578,480) to zero as of September 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Based upon the circumstances
detailed in previous paragraphs a), b) and c) herein, reducing the carrying value of CW-Bali&rsquo;s remaining assets for this
impairment loss of $578,480 was not deemed appropriate. Based upon our research, the existing accounting guidance does not specifically
provide or clarify whether or not the recording of this impairment loss as a reduction of the debit balance of the cumulative translation
adjustment recorded in the equity section of the balance sheet is appropriate. After considering subparagraph a. of ASC 830-30-40-1,
we elected not to record the impairment loss against the cumulative translation adjustment reflected in the equity section of our
balance sheet as such accounting would remove (by reducing its balance to zero) this separate component of equity prior to the
sale or substantial completion of a liquidation of CW-Bali. We believe our treatment of this impairment loss as a deferred credit
reflected in other liabilities, to be offset against the related cumulative translation adjustment at the time CW-Bali is sold
or substantially liquidated, is appropriate. We also believe the $578,480 balance of this deferred credit is immaterial to our
consolidated balance sheet regardless of its classification in other liabilities or stockholders&rsquo; equity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>*&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We acknowledge that:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">We are responsible for the adequacy and accuracy of
the disclosure in the filing;</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Staff comments or changes to disclosure in response
to Staff comments do not foreclose the Commission from taking any action with respect to the filing; and</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">We 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.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If you require any
additional information, kindly contact our outside U.S. legal counsel, Driscoll R. Ugarte with Duane Morris LLP at 561-962-2139.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 4.5in; text-align: justify">Sincerely,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 4.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 4.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 4.5in; text-align: justify">/s/ Frederick W. McTaggart</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 4.5in; text-align: justify">Chief Executive Officer and President</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 3.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 3.5in; text-align: justify">&nbsp;</P>

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<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in; text-align: left">cc:</TD><TD STYLE="text-align: justify">David W. Sasnett, Chief Financial Officer and Executive
Vice President</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Driscoll R. Ugarte,
Esq.</P>

<P STYLE="margin: 0">&nbsp;</P>

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