-----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,
 U1ypG89+cAKflzq5VWsI9Oel2p5myN/+wKPs8ldDW/924KZzZj/TSlgYgeplHVOS
 5xO4OXc8anW+QEELw2zYbw==

<SEC-DOCUMENT>0001019056-08-000036.txt : 20080306
<SEC-HEADER>0001019056-08-000036.hdr.sgml : 20080306
<ACCEPTANCE-DATETIME>20080108154230
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0001019056-08-000036
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20080108

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ESCALADE INC
		CENTRAL INDEX KEY:			0000033488
		STANDARD INDUSTRIAL CLASSIFICATION:	 [3949]
		IRS NUMBER:				132739290
		STATE OF INCORPORATION:			IN
		FISCAL YEAR END:			1230

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		817 MAXWELL AVE.
		CITY:			EVANSVILLE
		STATE:			IN
		ZIP:			47711
		BUSINESS PHONE:		812-467-4449

	MAIL ADDRESS:	
		STREET 1:		817 MAXWELL AVE.
		CITY:			EVANSVILLE
		STATE:			IN
		ZIP:			47711

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	MARTIN YALE BUSINESS MACHINES CORP
		DATE OF NAME CHANGE:	19820310

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	MARTIN YALE INDUSTRIES INC
		DATE OF NAME CHANGE:	19720306

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	WILLIAMS MANUFACTURING CO
		DATE OF NAME CHANGE:	19710504
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.htm
<TEXT>
<html>
    <head>
        <title></title>
    </head>

    <body>
        <!-- MARKER FORMAT-SHEET="Para (List) Hang " FSL="Default" -->

        <table cellspacing="0" cellpadding="0" width="100%">
            <tr valign="top">
                <td align="left" width="40%">
                <font face="Times New Roman, Times, Serif" size="3"><b>ESCALADE</b><sup>&reg;</sup></font>
                <font face="Times New Roman, Times, Serif" size="2">inc.<br>
                www.escaladeinc.com</font> </td>

                <td width="60%">
                    <p align="left"><font face="Times New Roman, Times, Serif" size="2">P.O. Box
                    889&nbsp;&nbsp;&nbsp; Evansville, IN 47706-0889<br>
                    817 Maxwell Avenue&nbsp;&nbsp;&nbsp; Evansville, IN 47711<br>
                    T: 812-467-4449 &nbsp;&nbsp; F: 812-467-1303</font></p>
                </td>
            </tr>
        </table>
        <br>
        <!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" --><a name="A002"></a>

        <p align="center"><font face="Times New Roman, Times, Serif" size="2">January 8,
        2008</font></p>
        <!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" --><a name="A003"></a>

        <h1 align="left"><font face="Times New Roman, Times, Serif" size="2"><b><u>Via EDGAR
        &ndash; CORRESP</u></b></font></h1>
        <!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" --><a name="A004"></a>

        <p align="left"><font face="Times New Roman, Times, Serif" size="2">Securities and Exchange
        Commission<br>
        100 F St., N.E., Mail Stop 3561<br>
        Washington, D.C. 20549<br>
        Attention: Mr. David R. Humphrey,<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Branch
        Chief</font></p>
        <!-- MARKER FORMAT-SHEET="Head Sub 2 Left" FSL="Default" -->

        <table cellspacing="0" cellpadding="0" width="100%" border="0">
            <tr valign="top">
                <td align="left" width="1%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>

                <td align="left" width="4%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>

                <td align="left" width="5%"><font face="Times New Roman" size="2">Re:</font></td>

                <td align="left" width="2%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>

                <td align="left" width="85%"><font face="Times New Roman" size="2">Escalade,
                Incorporated, File No. 000-06966,<br>
                <u>Form 10-K for Fiscal Year Ended December 30, 2006</u></font></td>

                <td align="left" width="1%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>

                <td align="left" width="1%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>
            </tr>
        </table>
        <!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" --><a name="A009"></a>

        <p align="left"><font face="Times New Roman, Times, Serif" size="2">Dear Mr.
        Humphrey:</font></p>
        <!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->

        <p>
        <font face="Times New Roman, Times, Serif" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Escalade,
        Incorporated has prepared this letter in response to the Staff&rsquo;s comment letter dated
        December 21, 2007 and received by the Company on that date regarding the Company&rsquo;s
        Form 10-K for its fiscal year ended December 30, 2006. Escalade&rsquo;s responses set forth
        below correspond to the applicable comment number as set forth in the Staff&rsquo;s comment
        letter.</font></p>
        <!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->

        <p><font face="Times New Roman, Times, Serif" size="2"><u>Comment 1</u>:&nbsp;&nbsp; During
        the fourth quarter of fiscal year 2006, Escalade&rsquo;s management engaged an independent
        registered public accounting firm not otherwise engaged in the audit of the financial
        statements of any of Escalade or its subsidiaries to assist management in determining the
        proper jurisdiction in which to recognize income. Due to continuing growth of the
        Company&rsquo;s business in various domestic and foreign locations, management recognized
        that income recognition was becoming increasingly complex and impacted the tax potentially
        due in such jurisdictions. In the course of such review as part of its year-end tax accrual
        process during the fourth quarter of fiscal year 2006, Escalade&rsquo;s management
        determined that the Company previously had over-accrued for taxes and identified
        misstatements in the income tax accruals for fiscal years 2005 and 2004. Based on this
        fact, management then modified its procedures during the fourth quarter of fiscal year 2006
        and put new controls in place at or before the end of fiscal year 2006 so that income
        recognition and tax accruals for fiscal year 2006 would be accurate, and Escalade&rsquo;s
        management determined that its internal controls were effective as of the end of fiscal
        year 2006. In the first quarter of fiscal year 2007, Escalade&rsquo;s management determined
        the extent of the misstatements in fiscal years 2005 and 2004 which then led to the Audit
        Committee&rsquo;s determination that such misstatements in prior years were material and
        that such prior period financial statements needed to be restated prior to the filing of
        Escalade&rsquo;s Form 10-K for its fiscal year ended December 30, 2006.</font></p>
        <!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->

        <p><font face="Times New Roman, Times, Serif" size="2">Accordingly, management then filed
        an amended Form 10-K for each of its fiscal years ended December 31, 2005 and December 25,
        2004, which in each case included management&rsquo;s amended report on internal control
        over financial reporting to conclude that the Company&rsquo;s internal control over
        financial reporting was ineffective as of December 31, 2005 and December 25, 2004 solely
        with respect to calculating the provision for income taxes. The Company&rsquo;s independent
        registered public accounting firm concurred with this assessment and revised its report on
        internal control over financial reporting as of December 31, 2005 and December 25, 2004,
        which revised report was included in the Company&rsquo;s amended Form 10-K for each of its
        respective fiscal years.</font></p>
        <hr align="center" width="100%" noshade size="2">

        <p style="PAGE-BREAK-BEFORE: always" align="left"></p>
        <PAGE><!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->

        <p><font face="Times New Roman, Times, Serif" size="2"><u>Comment 2</u>:&nbsp;&nbsp; In
        future filings, the Company will disclose its recognition policy regarding interest and
        late fees on accounts receivable. The Company believes that its recognition policy
        regarding interest and late fees on accounts receivable did not have a material effect on
        its previously filed financial statements and did not disclose such policy.</font></p>
        <!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->

        <p><font face="Times New Roman, Times, Serif" size="2"><u>Comment 3</u>:&nbsp;&nbsp; In
        future filings, the Company will revise its financial statements to classify all operating
        expenses as components of operating income including amortization of intangible assets,
        deferred compensation, and vendor charge-backs. At that time, prior year amounts will be
        reclassified accordingly.</font></p>
        <!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->

        <p><font face="Times New Roman, Times, Serif" size="2"><u>Comment 4</u>:&nbsp;&nbsp; Vendor
        charge-backs represent fees assessed suppliers for manufacturing deficiencies. Because of
        the infrequent nature and collection uncertainty associated with these assessments, such
        vendor charge-backs are not recognized until collected. As stated in response to Comment 3
        above, in future filings vendor charge-backs will be recorded as a component of operating
        income. Volume rebates and catalog allowances are specifically related to our customers and
        related revenues, while the vendor charge-backs are more closely aligned with our cost of
        products sold.</font></p>
        <!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->

        <p><font face="Times New Roman, Times, Serif" size="2"><u>Comment 5</u>:&nbsp;&nbsp;
        Product warranty costs are recorded as a component of net revenue, although not broken out
        separately in the Company&rsquo;s previously filed financial statements as the Company
        believes that such costs were not material. In future filings, the Company will disclose
        the classification of its warranty expense within its statements of income.</font></p>
        <!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->

        <p><font face="Times New Roman, Times, Serif" size="2">Warranty expense in fiscal years
        2005 and 2006 were materially lower than in fiscal year 2004 because beginning in fiscal
        year 2005 Escalade&rsquo;s management revised its liability assessments and related
        warranty liability relating to product lines purchased in fiscal year 2003 based on
        historical experience that the Company gained with respect to those product lines
        subsequent to their acquisition.</font></p>
        <!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->

        <p><font face="Times New Roman, Times, Serif" size="2"><u>Comment 6</u>:&nbsp;&nbsp; In
        future filings, the Company will disclose total rent expense. The Company believes that
        rent expense for leases less than one year would not have had a material effect on its
        previously filed financial statements.</font></p>
        <!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->

        <p><font face="Times New Roman, Times, Serif" size="2"><u>Comment 7</u>:&nbsp;&nbsp; In
        future filings, the Company will disclose the remaining borrowing capacity on credit lines
        restricted by underlying collateral.</font></p>
        <!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->

        <p>
        <font face="Times New Roman, Times, Serif" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
        connection with responding to the Staff&rsquo;s comments, the Company hereby acknowledges
        that (i) the Company is responsible for the adequacy and accuracy of the disclosures in its
        Form 10-K for the fiscal year ended December 30, 2006, (ii) Staff comments or changes to
        disclosures in response to Staff comments do not foreclose the Commission from taking any
        action with respect to the Company&rsquo;s Form 10-K, and (iii) 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.</font></p>

        <p align="center"><font face="Times New Roman, Times, Serif" size="2">2</font></p>
        <hr align="center" width="100%" noshade size="2">

        <p style="PAGE-BREAK-BEFORE: always" align="left"></p>
        <PAGE>
        <!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->

        <p>
        <font face="Times New Roman, Times, Serif" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
        believe that the Staff will find this letter to be fully responsive to the Staff&rsquo;s
        December 21, 2007 comment letter. Thank you in advance for your consideration of our
        responses. In the event that the Staff would have any additional questions or comments,
        please contact me at (812) 467-1334 or by fax at (812) 467-1303.</font></p>
        <!-- MARKER FORMAT-SHEET="Head Left" FSL="Default" -->

        <table cellspacing="0" cellpadding="0" width="100%">
            <tr valign="top">
                <td align="left" width="40%">
                <font face="Times New Roman, Times, Serif" size="2">&nbsp;</font> </td>

                <td width="60%">
                    <p align="left">
                    <font face="Times New Roman, Times, Serif" size="2">Respectfully,</font></p>
                </td>
            </tr>

            <tr valign="top">
                <td align="left" width="40%">
                <font face="Times New Roman, Times, Serif" size="2">&nbsp;</font> </td>

                <td width="60%">
                    <p align="left">&nbsp;</p>
                </td>
            </tr>

            <tr valign="top">
                <td align="left" width="40%">
                <font face="Times New Roman, Times, Serif" size="2">&nbsp;</font> </td>

                <td width="60%">
                    <p align="left">
                    <font face="Times New Roman, Times, Serif" size="2"><b>ESCALADE,
                    INCORPORATED</b></font></p>
                </td>
            </tr>

            <tr valign="top">
                <td align="left" width="40%">
                <font face="Times New Roman, Times, Serif" size="2">&nbsp;</font> </td>

                <td width="60%">
                    <p align="left">&nbsp;</p>
                </td>
            </tr>

            <tr valign="top">
                <td align="left" width="40%">
                <font face="Times New Roman, Times, Serif" size="2">&nbsp;</font> </td>

                <td width="60%">
                    <p align="left"><font face="Times New Roman, Times, Serif" size="2">/s/ Terry
                    D. Frandsen</font></p>
                </td>
            </tr>

            <tr valign="top">
                <td align="left" width="40%">
                <font face="Times New Roman, Times, Serif" size="2">&nbsp;</font> </td>

                <td width="60%">
                    <hr align="left" width="60%" color="black" size="1">
                </td>
            </tr>

            <tr valign="top">
                <td align="left" width="40%">
                <font face="Times New Roman, Times, Serif" size="2">&nbsp;</font> </td>

                <td width="60%">
                    <p align="left"><font face="Times New Roman, Times, Serif" size="2">Terry D.
                    Frandsen, Chief Financial Officer</font></p>
                </td>
            </tr>
        </table>

        <table cellspacing="0" cellpadding="0" width="100%" border="0">
            <tr valign="bottom">
                <td align="left" width="3%"><font face="Times New Roman" size="2">cc:</font></td>

                <td align="left" width="1%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>

                <td align="left" width="93%"><font face="Times New Roman" size="2">Amy Geddes,
                SEC</font></td>

                <td align="left" width="1%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>

                <td align="left" width="1%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>
            </tr>

            <tr valign="bottom">
                <td align="left" width="3%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>

                <td align="left" width="1%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>

                <td align="left" width="93%"><font face="Times New Roman" size="2">Lyn Shenk,
                SEC</font></td>

                <td align="left" width="1%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>

                <td align="left" width="1%"><font face="Times New Roman" size="2">&nbsp;</font>
                </td>
            </tr>
        </table>

        <p align="center"><font size="2">3</font></p>

        <p>&nbsp;</p>
    </body>
</html>

</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
