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<SEC-DOCUMENT>0001193125-10-159126.txt : 20101129
<SEC-HEADER>0001193125-10-159126.hdr.sgml : 20101129
<ACCEPTANCE-DATETIME>20100715062217
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0001193125-10-159126
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20100715

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ACTUATE CORP
		CENTRAL INDEX KEY:			0001062478
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-PREPACKAGED SOFTWARE [7372]
		IRS NUMBER:				943193197
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		2207 BRIDGEPOINTE PARKWAY
		STREET 2:		SUITE 500
		CITY:			SAN MATEO
		STATE:			CA
		ZIP:			94404
		BUSINESS PHONE:		650.645.3000

	MAIL ADDRESS:	
		STREET 1:		2207 BRIDGEPOINTE PARKWAY
		STREET 2:		SUITE 500
		CITY:			SAN MATEO
		STATE:			CA
		ZIP:			94404

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	ACTUATE SOFTWARE CORP
		DATE OF NAME CHANGE:	19980527
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.htm
<TEXT>
<HTML><HEAD>
<TITLE>SEC Response Letter</TITLE>
</HEAD>
 <BODY BGCOLOR="WHITE">

 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><U>Actuate Corporation has claimed confidential treatment of portions of this letter in
accordance with 17 C.F.R. &#167; 200.83 </U></B></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">July&nbsp;15, 2010 </FONT></P>
<P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Ms.&nbsp;Kathleen Collins </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Accounting Branch
Chief </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Division of Corporate Finance </FONT></P>
<P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Securities and Exchange Commission </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Washington,
D.C. 20549 </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>RE:</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B></B>Re: Actuate Corporation </FONT></TD></TR></TABLE>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Form l0-K for the Fiscal Year Ended December&nbsp;31, 2009, Filed March&nbsp;10, 2010 </FONT></TD></TR></TABLE>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Form 10-Q for the Fiscal Quarter Ended March&nbsp;31, 2010, Filed May&nbsp;7, 2010 </FONT></TD></TR></TABLE>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Form 8-K, Filed February&nbsp;2, 2010 </FONT></TD></TR></TABLE>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Form 8-K, Filed May&nbsp;3, 2010 </FONT></TD></TR></TABLE>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">File No. 000-24607 </FONT></TD></TR></TABLE> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Dear Ms.&nbsp;Collins:
</FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">We are writing in response to the letter from the Securities and Exchange Commission (the &#147;Commission&#148;) dated June&nbsp;7, 2010
(the &#147;Comment Letter&#148;) in which the Staff of the Commission (the &#147;Staff&#148;) requested certain additional information regarding the above-referenced filings. For your convenience, the numbering of this response corresponds to the
section headings and numbering used by the Staff in the Comment Letter. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">The Company acknowledges that the adequacy and accuracy of
disclosures in our filings with the Commission are our responsibility. We acknowledge that the Staff&#146;s comments or changes to our disclosures in response to the Staff&#146;s comments do not foreclose the Commission from taking any action with
respect to our filings. We also understand that the Staff&#146;s comments may not be asserted as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States. We also acknowledge that
the Division of Enforcement has access to all information that we provide to the Staff of the Division of Corporation Finance. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Form
10-K for the Fiscal Year Ended December&nbsp;31, 2009 </U></I></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Item&nbsp;7. Management&#146;s Discussion and Analysis of Financial
Condition and Results of Operations </U></I></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Critical Accounting Policies, Judgments and Estimates </U></I></FONT></P>
<P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Valuation of Goodwill, page 39 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TR>
<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>1.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note your discussion regarding the valuation of goodwill as a critical accounting policy on page 39. Please tell us your consideration to include a description of
the methods and key assumptions used to determine the fair value of your reporting unit. Also, please clarify whether you have determined that the estimated fair value substantially exceeds the carrying value of your reporting unit, and if so please
disclose this determination in future filings. To the extent that your reporting unit has an estimated fair value that is not substantially in excess of the carrying value and is at potential risk of failing step one of your goodwill impairment
analysis, please tell and disclose the following in future filings: </I></FONT></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="12%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>&#149;</I></FONT></TD>
<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>the percentage by which the fair value of the reporting unit exceeded the carrying value as of the date of most recent test;
</I></FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="12%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>&#149;</I></FONT></TD>
<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>discuss the degree of uncertainty associated with the key assumptions used in determining the fair value of your reporting unit; and
</I></FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="12%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>&#149;</I></FONT></TD>
<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>describe the potential events and/or changes in circumstances that could reasonably be expected to negatively affect the key assumptions used in
determining fair value. </I></FONT></P></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>Please refer to Item&nbsp;303(a)(3)(ii) of Regulation S-K and Section V of
SEC Release No. - 8350.</I> </FONT></P>

<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Goodwill is tested at the reporting unit level by comparing the reporting unit&#146;s
carrying amount, including goodwill, to the fair value of the reporting unit. The Company begins its impairment test by applying a &#147;Market&#148; approach. Given the Company has one reporting unit, this approach involves comparing the market
capitalization of the Company to its carrying value. If this &#147;Market&#148; approach derives a fair value that significantly exceeds the carrying value of the Company then no further testing will be performed. However, if the &#147;Market&#148;
approach indicates the fair value does not significantly exceed the carrying value of the Company, we would perform a supplemental calculation of the estimated fair value of the reporting unit using an &#147;Income&#148; approach. We would then
consider the results of both the &#147;Market&#148; approach and &#147;Income&#148; approach to determine whether or not it was necessary to move to the second step of the goodwill impairment analysis.</B> </FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Thus far, the &#147;Market&#148; approach has consistently indicated that the estimated fair value of the reporting unit was
significantly higher than the carrying value. For example, the market capitalization of Actuate Corporation as of the date of our latest impairment test on October&nbsp;1, 2009 was approximately $254 million ($5.60 per share* 45,395K shares
outstanding). The carrying amount of Actuate Corporation as of October&nbsp;1, 2009 was approximately $71.0 million.</B> </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We
will enhance our critical accounting policy disclosures related to goodwill beginning with our Interim Report on Form 10-Q for the quarter ended June&nbsp;30, 2010 to describe our methods and key assumptions used to determine the fair value of our
reporting unit. Furthermore, we will indicate that the fair value of our reporting unit is substantially in excess of the carrying value. If at any time in the future the reporting unit has an estimated fair value that is not substantially in excess
of the carrying value and is at potential risk of failing step one of the goodwill impairment analysis, we will disclose the items noted by the Staff in your comment above.</B> </FONT></P>
<P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Results of Operations </U></I></FONT></P>
<P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>General and Administrative, pages 46 and 47 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>2.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note that the general and administrative expenses increased in 2009 primarily due to legal fees of approximately $3 million related to contract compliance
matters. We also note disclosures in your March&nbsp;31, 2010 Form 10-Q regarding an additional $2.4 million of legal fees. Please explain further the nature of these expenses and why they were incurred and tell us if you expect to incur similar
expenses in the future. In addition, we note references to your litigation with Oracle in certain analyst reports, however, you have not provided any disclosure regarding material litigation matters under Item&nbsp;3. Please explain why and tell us
how you considered disclosing the nature and reasons for these expenses in MD&amp;A. </I></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully
advise the Staff that we take a variety of actions to ensure that our customers are using and distributing our software in accordance with our license and service agreements. When we believe a customer has violated its license and service agreement,
we notify the customer and seek appropriate action by the customer to cure the violation. In general, these matters are resolved amicably, but in some instances disputes have arisen. In fiscal year 2009 and the quarter ended March&nbsp;31, 2010, the
legal fees of $3.0 million and $2.4 million, respectively, related to several disputes with customers regarding their compliance with our license and service agreements that have advanced to litigation. Our litigation with Oracle was the primary
source of the legal fees during these periods. Because the Oracle litigation was scheduled for trial in mid-June 2010, a similar level of legal fees were incurred during the quarter ending June&nbsp;30, 2010. On June&nbsp;17, 2010, the Company and
Oracle settled the litigation, which was announced by the Company on a Form 8-K on June&nbsp;18, 2010.</B> </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We have other
ongoing litigation with certain customers relating to their compliance with our license and services agreements and consequently we expect to incur legal fees associated with our contract compliance matters in the future. Nonetheless, we expect the
level of legal fees to decline significantly in the near term because of the settlement of the Oracle matter and the current state of the remainder of the Company&#146;s pending litigation. That said, it is possible that an adverse party in
litigation could take strategic or tactical decisions that could significantly increase litigation expenses with little warning.</B> </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">2 </FONT></P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>As mentioned above, the litigation with Oracle was one of several disputes with customers
regarding compliance with our license and service agreements. We did not provide any disclosure regarding our litigation with Oracle under Item&nbsp;3 of Part I of the Form 10-K or Item&nbsp;1 of Part II of the Form 10-Q because compliance matters
are a normal part of the Company&#146;s business. When we filed our Form 10-K for the year ended December&nbsp;31, 2009 and the Form 10-Q for the quarter ended March&nbsp;31, 2010, we had not asserted a specific claim for damages and were still
waiting for an estimate of our damages from our damage expert. Consequently, the quantitative test set forth in Instruction 2 to Item&nbsp;103 was not applicable. Further, the Company was not subject to any counterclaims from Oracle and so there was
no possibility for Oracle to recover damages from the Company.</B> </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Item&nbsp;7A. Quantitative and Qualitative Disclosures About Market
Risk, Page 60 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>3.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note you had losses for the last three years due to foreign exchange rate fluctuations. As some of those losses appear to be material to your net income and
earnings per share, tell us how you considered providing a sensitivity analysis or other quantitative presentation of the potential impact of changes in foreign exchange rates pursuant to Item&nbsp;305(a)(1) of Regulation S-K.
</I></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully advise the Staff that historically, with exception of fiscal 2008, foreign currency
exchange gain/(loss) has constituted less than 5% of our net income before income tax provision and foreign currency exchange gain/(loss) &#147;NIBIT&amp;FX&#148; results.</B> </FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We acknowledge that foreign currency exchange losses incurred in fiscal 2008 were higher than those experienced in the years prior to
2008. We believe that these losses incurred in 2008 were primarily a consequence of the unprecedented global turmoil that occurred in the financial and currency markets. As a result, in fiscal 2008, we experienced unusual revaluation losses, mainly
in Europe. We do not believe that results such as those experienced in 2008 were part of an on-going trend as the financial and currency markets have improved and have remained more stable since 2008. For instance, in fiscal 2009, our currency
exchange losses as a percentage of NIBIT&amp;FX improved to (5)% from (12)% experienced in fiscal 2008. Accordingly, we believe fiscal 2008 was an anomaly and that future currency exchange losses will continue to trend lower and remain within levels
experienced by us historically.</B> </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We will continue to monitor these trends carefully and in order to address the
Staff&#146;s concerns will include in our future annual filings, a supplemental disclosure under Item&nbsp;7A. &#147;Quantitative and Qualitative Disclosures about Market Risk&#148;, that will include a sensitivity analysis of the potential impact
of changes in foreign exchange rates pursuant to Item&nbsp;305(a)(1) of Regulation S-K. The proposed disclosure will be in the form similar to the table below. The proposed disclosure will include the potential impact on earnings resulting from
hypothetical changes in foreign currency exchange rates applied to significant monetary balances held by our foreign subsidiaries.</B> </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="84%" BORDER="0" ALIGN="center">

<TR>
<TD WIDTH="21%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD WIDTH="14%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD WIDTH="14%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD WIDTH="14%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD WIDTH="14%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD WIDTH="13%"></TD></TR>
<TR>
<TD VALIGN="bottom" COLSPAN="11" NOWRAP ALIGN="center" STYLE="border-bottom:1px solid #000000"> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>Change in currency exchange rates
applied to monetary accounts</B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:1px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>(in thousands )</B></FONT></P></TD></TR>
<TR>
<TD VALIGN="bottom" NOWRAP ALIGN="center" STYLE="border-bottom:1px solid #000000"> <P STYLE="margin-top:0px;margin-bottom:1px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>-15%</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center" STYLE="border-bottom:1px solid #000000"> <P STYLE="margin-top:0px;margin-bottom:1px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>-10%</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center" STYLE="border-bottom:1px solid #000000"> <P STYLE="margin-top:0px;margin-bottom:1px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>-5%</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center" STYLE="border-bottom:1px solid #000000"> <P STYLE="margin-top:0px;margin-bottom:1px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>+5%</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center" STYLE="border-bottom:1px solid #000000"> <P STYLE="margin-top:0px;margin-bottom:1px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>+10%</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center" STYLE="border-bottom:1px solid #000000"> <P STYLE="margin-top:0px;margin-bottom:1px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>+15%</B></FONT></P></TD></TR>
<TR BGCOLOR="#cceeff">
<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-left:1.00em; text-indent:-1.00em" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">$(XX)</FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">$(XX )</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">$(XX )</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">$XX</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">$XX</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">$XX</FONT></TD></TR></TABLE> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Item&nbsp;9A. Controls and
Procedures, page 61 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TR>
<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>4.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note your statement that &#147;A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance
that the objectives of the control system are met.&#148; If you continue to use the &#147;reasonable assurance&#148; language, you should state, if true, that your disclosure, controls and procedures are designed to provide reasonable assurance of
achieving their objectives and that your Chief Executive Officer and Chief Financial Officer concluded that your disclosure controls and procedures are effective at the reasonable</I>
</FONT></P></TD></TR></TABLE> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P><FONT STYLE="font-family:Times New Roman" SIZE="2">
<I>assurance level. Tell us what consideration you gave to providing such disclosure. Please refer to Section lI.F.4 of Management&#146;s Report on Internal Control Over Financial Reporting and
Certification of Disclosure in Exchange Act Periodic Reports, SEC Release No.&nbsp;33-8238, available on our website at <U>http://www.sec.gov/rules/finaI/33-8238.htm</U>.</I> </FONT></P></TD></TR></TABLE>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully advise the Staff that our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(3) under the Security Exchange Act of 1934, as amended) were designed to provide reasonable assurance of achieving their objectives and that our Chief Executive Officer and Chief
Financial Officer have concluded that the controls and procedures are effective at the reasonable assurance level. We will clarify such disclosure in our report in our next Annual Report on Form 10-K for the period ending December&nbsp;31, 2010.</B>
</FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>5.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>Your report should include a statement that the registered public accounting firm that audited your financial statements has issued an attestation report on the
company&#146;s internal control over financial reporting. Tell us how you considered providing such disclosures. We refer you to Item&nbsp;308(a)(4) of Regulation S-K.</I> </FONT></TD></TR></TABLE>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully acknowledge the Staff&#146;s comment regarding Item&nbsp;308(a)(4) of Regulation S-K. We will include such statement in
our report in our next Annual Report on Form 10-K for the period ending December&nbsp;31, 2010.</B> </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Part III, page 62
</U></I></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Item&nbsp;13. Certain Relationships, Related Transactions and Director Independence (incorporated by reference from definitive
proxy statement filed on April&nbsp;15, 2010) </U></I></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Election of Directors </U></I></FONT></P>
<P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Board of Directors Leadership Structure, Risk Management, Meetings and Committees </U></I></FONT></P>
<P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Risk Management, page 4 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TR>
<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>6.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note your disclosure in response to Item&nbsp;402(s) of Regulation S-K that your compensation programs are not reasonably likely to have a material adverse effect
on the company. Please describe the process you undertook to reach that conclusion.</I> </FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully
advise the Staff that in order to determine whether the Company&#146;s compensation programs were reasonably likely to have a material adverse effect, the Company considered the compensation structure available to each category of its employee base,
</B><B><I>ie.</I></B><B>, the combination of base salary, cash incentive awards, and long-term equity awards available not only to the named executive officers but also to all employees generally. To perform this task the General Counsel collected
the relevant information regarding compensation plans from either the Compensation Committee, compensation consultant or the Company&#146;s Human Resources Department and considered the risks associated with the forms of compensation structure. In
performing its risk assessment the Company noted that employees in the organization who did not have compensation comprised of all three compensation components fell into several categories. First, employees on a commission-based compensation plan
generally have a 50/50 split between base salary and commission at target. We believe this is an appropriate balance for such employees, and does not pose any material adverse risks to the Company, particularly since these individuals are generally
sales people and the transactions in their commission base are subject to the Company&#146;s internal audit controls. In addition, commissions are paid monthly and reflect actual sales revenue realized. Second, employees under the director level
receive base salary and equity awards, but no cash incentive awards. The Company believes compensation programs at this level of the organization pose no risk of a material adverse effect on the Company. For those employees on a cash plus quarterly
bonus plan, the compensation programs were structured so that any short-term cash incentives were not likely to constitute the predominant element of their total compensation package (most employees in this category have quarterly bonuses paid at
either 15% or 25% of their base salary per quarter). For the most part, the bonuses are paid based on the achievement of company-wide goals that depend on performance of many employees rather than personal achievement. The focus on the
Company&#146;s achievement rather than individual performance reduced the risk that individuals would take undue risk to increase achievement in their individual capacity as that achievement on its own would be likely to have little impact on</B>
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2">
<B>the performance of the Company as a whole. Further, each year the Company&#146;s Human Resource department determines that the Company&#146;s compensation packages were comparable with other
companies in the Company&#146;s peer group. Finally, for the named executive officers, the Compensation Committee worked closely with an outside consultant, Compensia to be sure the compensation plans for the named executive officers were
appropriately balanced between short-term and long-term incentives as well as between cash payments and equity awards and in line with the compensation structures at the Company&#146;s peer group and were not reasonably likely to have a material
adverse effect on the Company. Finally, while the Company concluded that its compensation programs were not reasonably likely to have a material adverse effect, the Company nevertheless provided disclosure in terms of a general risk assessment of
its compensation programs.</B> </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Certain Relationships, Related Transactions and Director Independence, page 27 </U></I></FONT></P>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>7.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note your disclosure pursuant to Item&nbsp;404(b)(1) of Regulation S-K. Please confirm in future filings you will provide disclosure regarding the standards you
apply to related party transactions pursuant to your Audit Committee charter.</I> </FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully advise the
Staff that in future filings the Company will provide disclosure regarding the standards applied to related party transactions pursuant to its Audit Committee charter.</B> </FONT></P>
<P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Consolidated Balance Sheets, Page F-4 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>8.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note from your disclosures on page F-8 that during the first quarter of fisca1 2009, you adopted the guidance for non-controlling interests in subsidiaries as
issued by the FASB. Tell us how you considered the guidance in ASC 810-10-45-16 through 45-24 to report the non-controlling interest as part of the equity of the consolidated group and to attribute the net income and comprehensive income to both the
parent and the non-controlling interest. We refer you to the disclosure examples in ASC 810-10-55-41 through 4J. Please provide your proposed revised disclosures and tell us how you intend to comply with this guidance. Also, to the extent that you
did not acquire a 100% interest in Xenos, tell us how you have reflected the non-controlling interest for this recent acquisition in your March&nbsp;31, 2010 financial statements.</I> </FONT></TD></TR></TABLE>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully advise the Staff that current disclosure of the non-controlling interest in Actuate Japan outside of permanent equity
(in the &#147;mezzanine&#148; section of the balance sheet) is correct as the non-controlling interest is redeemable. This is consistent with the SEC rule summarized below: </B></FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Rule 5-02.28 of Regulation S-X requires securities (including non-controlling interests) that are redeemable for cash or other assets
to be classified outside of permanent equity in the balance sheet of an SEC registrant if they are redeemable (1)&nbsp;at a fixed or determinable price on a fixed or determinable date, (2)&nbsp;at the option of the holder, or (3)&nbsp;upon the
occurrence of an event that is not solely within the control of the issuer, provided that those instruments are not classified as liabilities under Statement 150 or other applicable U.S. GAAP. </B></FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Consequently, Actuate&#146;s non-controlling interest being an equity-classified security with embedded redemption feature should be
presented outside of permanent equity even after adoption of Statement 160 (ASC 810-10-45-16). The Company therefore discloses the redeemable non-controlling interest at calculated redemption value in the mezzanine section retroactively for all
periods presented. </B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We also considered the disclosure guidelines with respect to the net income and comprehensive income
to both the parent and the non-controlling interest. The amounts attributable to the non-controlling interest in Japan were immaterial in fiscal 2009 and the first quarter of fiscal 2010, hence no separate disclosures were deemed necessary. For
instance, in fiscal 2009, the net loss attributed to the non-controlling interest was approximately $(9,900) or -0.1% of the total consolidated net income and approximately $(2,500) or -0.2% of the total consolidated net income for the first quarter
of 2010. </B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Finally, we respectfully inform the Staff that we acquired 100% interest in Xenos as of March&nbsp;31, 2010
and did not have a non-controlling interest position with respect to this acquisition. Therefore, the non-controlling interest disclosure in relation to the Xenos acquisition was not necessary in our March&nbsp;31, 2010 financial statements. </B>
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>CONFIDENTIAL TREATMENT REQUESTED BY ACTUATE CORPORATION FOR THE BRACKETED AND
</B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>BOLD TYPEFACE PORTIONS OF THIS RESPONSE. </B></FONT></P>
<P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Note 1. Summary of Significant Accounting Policies </U></I></FONT></P>
<P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Revenues, page F-9 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>9.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note for certain license transactions, including OEM and site licenses, the company uses a &#147;stated maintenance renewal&#148; approach to establish VSOE of
fair value for maintenance. Tell us how you considered ASC 985-605-25-67 in determining that the renewal rates were substantive. In this regard, please provide the range of renewal rates and tell us what percentage of your customers actually renews
at the stated renewal rates. Also, tell us how the stated renewal rates compare to your normal pricing practices and explain how you account for contracts that have stated renewal rates either above or below this normal range.
</I></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>As was indicated by the Staff, and consistent with ASC 985-605-25-67, the Company uses stated renewal
rates as principal evidence in evaluating whether VSOE of fair value is present for its OEM and site license transactions. Further, we consider whether stated renewal rates are substantive in determining whether they represent VSOE, including an
evaluation of the circumstances listed in ASC 985-650-55-63 (Technical Practice Aid 5100.54). Specifically, in order to determine that a renewal option is a substantive pricing indicator we believe it must be: </B></FONT></P>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>1</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Unconditionally exercisable at the option of the customer (that is, not subject to unilateral adjustment or rescission by the Company). </B></FONT></TD></TR></TABLE>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TR>
<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>2</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Available for a relatively long period of time and at least as long as the initial (bundled) service period. </B></FONT></TD></TR></TABLE>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>3</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Priced consistent with or higher than the Company&#146;s minimum normal pricing practices for similar types of transactions. </B></FONT></TD></TR></TABLE>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Information on the specific types of transactions on which the Staff inquired is as follows: </B></FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><U>Site Licenses</U>&#151;Site license transactions are typically large in size[**] . Approximately [**] of the site license
transactions concluded in North America have renewal rates of [**] for standard maintenance and/or [**] for Gold/Platinum maintenance. Deal structures and maintenance rates on these site license transactions are typically discussed and reviewed in
detail with the CEO prior to contract signing to ensure that the transaction is in line with target margins. Site license transactions with renewal rates below the [**] indicated above would be investigated and would require the approval of the CFO
prior to contract signing. To date, we have not executed any site license arrangements with renewal rates below the [**] level. </B></FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><U>OEM Licenses</U>&#151;Most of our OEM customers support their end users directly. Consequently, we typically provide &#147;second
line&#148; maintenance services to our OEM customers. Approximately [**] of all the OEM transactions entered into by our North American business units over the past two years (since July&nbsp;1, 2008) have maintenance rates between [**] of the
license value. The [**]. Deal structures and maintenance rates on these large OEM transactions are typically discussed and reviewed in detail with the CEO prior to contract signing to ensure that the transaction is in line with target margins for
such transactions. Our CFO must approve any maintenance discounts exceeding certain thresholds. In the past two years, we have not executed any new OEM arrangements with renewal rates below [**]. </B></FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>If a site license or OEM transaction has a stated renewal rate that is below our normal pricing ranges for comparable transactions then
we would determine that the rate was not substantive. Consequently, we would not be able to establish VSOE on that transaction and all of the revenue related to that transaction would be recognized ratably over the term of the offered maintenance
period. </B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>As a general rule, approximately [**] of our OEM and site license customers renew maintenance at the stated
renewal rate for at least one year. Initial bundled maintenance is typically for a single year. </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Note 10. Restructuring Charges, page F-31 </U></I></FONT></P>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>10.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note the restructuring accrual activity on page F-33 includes increases to the liability for &#147;rents collected on the sublease.&#148; Please explain further
why the subleased rental income would increase the accrued restructuring liability. To the extent that the sublease payments received were used to offset the company&#146;s rental &#147;cash payments&#148; then tell us your consideration to clarify
your disclosures to either net the rental collections against cash payments or provide a footnote explanation to the table. </I></FONT></TD></TR></TABLE>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully advise the Staff that sublease proceeds received and disclosed in the restructuring accrual activity schedule are
directly associated with cash payments for rent on operating leases and represent a partial offset to the initial restructuring charge in accordance with ASC 420-10-30-7 through 30-9. We estimated and accrued for contractual rent obligations, net of
associated sublease proceeds on our idle facilities, at the time we ceased use and were no longer receiving economic benefits from these facilities. Once the initial liability was established, subsequent payments for contract rent were charged
against the liability balance. As cash was collected on the sublease, it was applied to the liability balance, not to increase the liability balance, but to partially offset the contract rent. </B></FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully consider Staff&#146;s comment and to the extent applicable to future periodic reports, intend to clarify our disclosure
by combining rental cash payments with rental cash collections on sublease as a net reduction to the restructuring accrual. </B></FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Form
10-Q for the Fiscal Quarter Ended March&nbsp;31, 2010 </U></I></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Item&nbsp;4. Controls and Prgcedures, page 35 </U></I></FONT></P>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>11.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note your disclosure controls and procedures &#147;were effective to provide reasonable assurance that information required to be disclosed in the reports Actuate
files and submits under the Exchange Act are recorded, processed, summarized and reported as and when required.&#148; Please revise to clarify, if true, that your officers concluded that your disclosure controls and procedures are also effective to
provide reasonable assurance that information required to be disclosed in the reports that you file under the Exchange Act is accumulated and communicated to your management, including your Chief Executive Officer and Chief Financial Officer, to
allow timely decisions regarding required disclosure. Alternatively, you could remove the wording of the definition, since you have already included a reference to Rules 13a-15(e) and 15d-15(e). We refer you to Exchange Act Rule 13a-15(e).
</I></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully advise the Staff that our Chief Executive Officer and Chief Financial Officer have
concluded that our disclosure controls and procedures were effective at the reasonable assurance level to ensure that the information required to be disclosed by us in the quarter report on Form 10-Q was accumulated and communicated to our
management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. We will clarify this in our next Quarterly Report on Form 10-Q for the period ending June&nbsp;30, 2010. </B>
</FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Form 8-K Filed May&nbsp;3, 2010 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>12.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note your disclosures regarding non-GAAP operating margins and non-GAAP EPS, which exclude certain litigation expenses of $2.5 million, as well as your discussion
of non-GAAP operating income for the first quarter of fiscal 2010 compared to the first quarter of fiscal 2009. If you continue to use these measures, you should provide a reconciliation of the difference between each non-GAAP measure and the
comparable GAAP measure. Please tell us how you intend to comply with the disclosure requirements of Regulation G in your future Form 8-K filings. </I></FONT></TD></TR></TABLE>
<P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">7 </FONT></P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully advise the Staff that we have historically typically only disclosed in
our 8-K filings those non-GAAP measures that are reconciled in the table entitled &#147;Reconciliation of GAAP to Non-GAAP Financial Measures&#148;. In this table as included in the 8-K filed on May&nbsp;3, 2010, Non-GAAP income before taxes and
non-GAAP income per share does not exclude certain legal expenses of $2.5 million. These legal expenses are included in our non-GAAP numbers reconciled in the table. However, in the quarter covered in the filing the Company experienced unusually
high litigation expenses. The Company felt it would be beneficial to the investor to provide additional information on this expense and how it impacted non-GAAP earnings. Therefore, in the text of the 8-K the Company did discuss how non-GAAP
operating margins and non-GAAP EPS would have been affected if we did not experience these unusually high legal expenses. </B></FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>The Company does not anticipate discussing Non-GAAP Operating Margin excluding unusual legal expenses or Non-GAAP EPS excluding unusual
legal expenses in its future 8-K filings. Therefore, we do not anticipate that this supplemental reconciliation data will be necessary in our future filings. We will, however, continue to include the table entitled &#147;Reconciliation of GAAP to
Non-GAAP Financial Measures&#148; as we have in the past along with all related textual disclosures. However, to the extent that the Company does in the future exclude unusual legal expenses or Non-GAAP EPS excluding unusual legal expenses in its
future 8-K filings it will provide additional supplemental disclosure, including a reconciliation of GAAP income before taxes as previously shown in the table, to what the Non-GAAP operating margin and Non-GAAPP EPS number would have been if we did
not experience the unusually high legal expenses. </B></FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Form 8-K Filed February&nbsp;2, 2010 </U></I></FONT></P>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TR>
<TD WIDTH="4%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>13.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note your Form 8-K dated February&nbsp;1, 2010 regarding the acquisition of Xenos, where you indicate the Item&nbsp;9.01(a) and 9.01(b) information will be filed
by amendment in not later than 71 calendar days. Please tell us why you have not yet filed such Form 8K. If you believe the acquisition does not meet the significance test of Rule 1-02(w) of Regulation S~X then please provide us with your
calculations of the significance tests to support your omission of the financial statements required by Rule 3-05 of Regulation SX and the related pro forma information as required by Article 11 of Regulation S-X. </I></FONT></TD></TR></TABLE>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>We respectfully advise the Staff that at the time it filed the Form 8-K filed with the Commission on February&nbsp;2, 2010 regarding
the filing of financial statements for Xenos Group, Inc. (&#147;Xenos&#148;), the analysis to determine whether or not the Company was required to file financial statements of Xenos and pro forma financial information under Item&nbsp;9.01 of Form
8-K was in process. Therefore, the wording should have indicated that the financial statements would be filed within 71 days, &#147;if determined to be required or appropriate&#148;. Under the requirements of Item&nbsp;9.01(a) and (b), Rule
3-05(b)(2) of Regulation S-X and Article 11 of Regulation S-X, filing financial statements of Xenos and pro forma financial information on a Form 8-K/A is required only if one of the following conditions are met: </B></FONT></P>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>1.</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Investment test &#151; Actuate&#146;s investment in Xenos exceeded 20 percent of Actuate&#146;s total assets as of the end of the most recently completed fiscal
year; or </B></FONT></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>2.</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Asset test &#151; Xenos&#146; total assets exceeded 20 percent of Actuate&#146;s total assets as of the end of the most recently completed fiscal year; or
</B></FONT></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="8%"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>3.</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Income test &#151; Xenos&#146; pretax income exceeded 20 percent of Actuate&#146;s pretax income for the most recently completed fiscal year.
</B></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Regarding the investment test, Actuate&#146;s investment in Xenos did not exceed 20 percent of
Actuate&#146;s total assets as of the end of the fiscal year ended 12/31/09. This determination was based on the following calculations (dollars in 000&#146;s): </B></FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="68%" BORDER="0" ALIGN="center">

<TR>
<TD WIDTH="88%"></TD>
<TD VALIGN="bottom" WIDTH="6%"></TD>
<TD></TD>
<TD></TD></TR>
<TR BGCOLOR="#cceeff">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Total investment in Xenos, net of cash acquired</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD ALIGN="right" COLSPAN="1" VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>27,432</B></FONT></TD>
<TD COLSPAN="1" NOWRAP VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>&nbsp;&nbsp;</B></FONT></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Total Actuate assets as of 12/31/09</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD ALIGN="right" COLSPAN="1" VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>169,764</B></FONT></TD>
<TD COLSPAN="1" NOWRAP VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>&nbsp;&nbsp;</B></FONT></TD></TR>
<TR STYLE="font-size:1px">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" STYLE="border-top:1px solid #000000">&nbsp;</TD>
<TD>&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Investment as a % of total assets</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD ALIGN="right" COLSPAN="1" VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>16</B></FONT></TD>
<TD COLSPAN="1" NOWRAP VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>%&nbsp;</B></FONT></TD></TR></TABLE> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">8 </FONT></P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Regarding the asset test, Xenos&#146; total assets did not exceed 20 percent of
Actuate&#146;s total assets as of the end of the most recently completed fiscal year. This determination was based on the following calculations (dollars in 000&#146;s): </B></FONT></P>
<P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="68%" BORDER="0" ALIGN="center">

<TR>
<TD WIDTH="88%"></TD>
<TD VALIGN="bottom" WIDTH="6%"></TD>
<TD></TD>
<TD></TD></TR>
<TR BGCOLOR="#cceeff">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Total Xenos assets at 9/30/09</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD ALIGN="right" COLSPAN="1" VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>16,369</B></FONT></TD>
<TD COLSPAN="1" NOWRAP VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>&nbsp;&nbsp;</B></FONT></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Total Actuate assets as of 12/31/09</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD ALIGN="right" COLSPAN="1" VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>169,764</B></FONT></TD>
<TD COLSPAN="1" NOWRAP VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>&nbsp;&nbsp;</B></FONT></TD></TR>
<TR STYLE="font-size:1px">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" STYLE="border-top:1px solid #000000">&nbsp;</TD>
<TD>&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Xenos assets as % of Actuate assets</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD ALIGN="right" COLSPAN="1" VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>10</B></FONT></TD>
<TD COLSPAN="1" NOWRAP VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>%&nbsp;</B></FONT></TD></TR></TABLE>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Regarding the income test, Xenos&#146; pretax income did not exceed 20 percent of Actuate&#146;s pretax income for the most recently
completed fiscal year. This determination was based on the following calculations (dollars in 000&#146;s): </B></FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="68%" BORDER="0" ALIGN="center">

<TR>
<TD WIDTH="89%"></TD>
<TD VALIGN="bottom" WIDTH="7%"></TD>
<TD></TD>
<TD></TD></TR>
<TR BGCOLOR="#cceeff">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Xenos pretax income for fiscal year ended 9/30/09</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD ALIGN="right" COLSPAN="1" VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>1,170</B></FONT></TD>
<TD COLSPAN="1" NOWRAP VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>&nbsp;&nbsp;</B></FONT></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Actuate pretax income for fiscal year ended 12/31/09</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD ALIGN="right" COLSPAN="1" VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>16,089</B></FONT></TD>
<TD COLSPAN="1" NOWRAP VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>&nbsp;&nbsp;</B></FONT></TD></TR>
<TR STYLE="font-size:1px">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" STYLE="border-top:1px solid #000000">&nbsp;</TD>
<TD>&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Xenos pretax income as percentage of Actuate pretax income</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD ALIGN="right" COLSPAN="1" VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>7</B></FONT></TD>
<TD COLSPAN="1" NOWRAP VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>%&nbsp;</B></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>The
percentage calculations for all three of these tests fall below the 20% threshold required for it to be considered a significant subsidiary. Accordingly, we have concluded that Xenos does not represent a significant subsidiary as defined in
Regulation S-X. </B></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Should you have any further questions, please do not hesitate to call me at (650)&nbsp;645-3494 </FONT></P>
<P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Sincerely, </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TR>
<TD WIDTH="100%"></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-top:0px;margin-bottom:1px;border-bottom:1px solid #000000"><FONT STYLE="font-family:Times New Roman" SIZE="2">/s/ Peter Cittadini</FONT></P></TD></TR>
<TR>
<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Peter Cittadini</FONT></TD></TR>
<TR>
<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">President and Chief Executive Officer</FONT></TD></TR></TABLE> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">cc:</FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Mr.&nbsp;Robert Benton, Staff Accountant, Division of Corporate Finance </FONT></TD></TR></TABLE>
<P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">9 </FONT></P>

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