DEFERRED COMPENSATION (Notes)

12 Months Ended

Jun. 30, 2016

Deferred Compensation [Abstract]

Deferred Compensation

The Company has deferred compensation agreements with a former and current officer. The related expense is calculated using the net present value of the expected payments and is included in selling, general and administrative expenses in the Consolidated Statements of Income. The Company's current and non-current deferred compensation obligations are included in accrued liabilities and deferred compensation, respectively, in the Consolidated Balance Sheets. The net present value was calculated for the former officer using a discount factor of 2.60% and 2.70% as of June 30, 2016 and 2015, respectively. The net present value was calculated for the current officer using a discount factor of 4.80% and 4.80% at June 30, 2016 and 2015, respectively.

The Board of Directors entered into an agreement to continue the 1991 base salary of the former chairman for the remainder of his life.  These payments began in the fiscal year ended June 30, 2015, and payments of $150,000 and $50,000 were made under this arrangement for the years ended June 30, 2016 and 2015, respectively.  The Company has a deferred compensation liability of $772,026 and $820,720 recorded as of June 30, 2016 and 2015, respectively.  Deferred compensation expense of $101,306 and $166,414 was recognized under this arrangement in 2016 and 2015, respectively.

The Board of Directors has approved a supplemental retirement plan with an officer that calls for annual cash compensation following retirement from the Company in an amount equal to 2% of base salary, as defined in the agreement, multiplied by the number of years of service to the Company.  The retirement payments are to be paid monthly to the officer until his death and then to his surviving spouse monthly until her death.  The Company has a deferred compensation liability of $1,565,688 and $1,436,766 recorded as of June 30, 2016 and 2015, respectively.  Deferred compensation expense of $128,922 and a reversal of deferred compensation expense of $179,019 was recognized under this arrangement in 2016 and 2015, respectively.

The Company uses life insurance policies to provide funds to meet its deferred compensation obligations.