Basis of Presentation (Policies)

9 Months Ended

Jun. 30, 2024

No accounting pronouncements recently issued or newly effective have had, or are expected to have, a material impact on the Company’s condensed consolidated financial statements.

Marketable Securities

Marketable debt and equity securities are categorized as trading securities and are thus marked to market and stated at fair value. Fair value is determined using the quoted closing or latest bid prices for Level 1 investments and market standard valuation methodologies for Level 2 investments. Realized gains and losses on investment transactions are determined by specific identification and are recognized as incurred in the Condensed Consolidated Income Statements. Net changes in unrealized gains and losse

are reported in the Condensed Consolidated Income Statements in the current period.

Fair Value Measurements

The fair value of financial instruments is presented based upon a hierarchy of levels that prioritizes the inputs of valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The fair value of marketable equity securities (stocks), mutual funds, exchange-traded funds, government securities, and cash and money funds, are substantially based on quoted market prices (Level 1). Corporate bonds are valued using market standard valuation methodologies, including: discounted cash flow methodologies, and matrix pricing or other similar techniques. The inputs to these market standard valuation methodologies include, but are not limited to: interest rates, credit standing of the issuer or counterparty, industry sector of the issuer, coupon rate, call provisions, maturity, estimated duration and assumptions regarding liquidity and estimated future cash flows. In addition to bond characteristics, the valuation methodologies incorporate market data, such as actual trades completed, bids and actual dealer quotes, where such information is available. Accordingly, the estimated fair values are based on available market information and judgments about financial instruments (Level 2). Fair values of the Level 2 investments are provided by the Company’s professional investment management firms. From time to time the Company may transfer cash between its marketable securities portfolio and operating cash and cash equivalents.

The following table sets forth, by level, within the fair value hierarchy, the Company’s marketable securities measured at fair value as of June 30, 2024:


	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
Exchange-Traded Funds	$	3,557,000	$	—	$	—	$	3,557,000
Corporate Bonds		—		31,452,000		—		31,452,000
Government Securities		52,612,000		—		—		52,612,000
Cash and Money Funds		184,000		—		—		184,000

Total	$	56,353,000	$	31,452,000	$	—	$	87,805,000

Net unrealized gains and (losses) included in the Condensed Consolidated Income Statements for the quarter and nine months ended June 30, 2024, were $195,000 and $1,346,000, respectively.

The following table sets forth by level, within the fair value hierarchy, the Company’s assets measured at fair value as of September 30, 2023:


	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
Exchange-Traded Funds	$	3,327,000	$	—	$	—	$	3,327,000
Corporate Bonds		—		33,160,000		—		33,160,000
Government Securities		47,672,000		—		—		47,672,000
Cash and Money Funds		93,000		—		—		93,000

Total	$	51,092,000	$	33,160,000	$	—	$	84,252,000

Net unrealized gains and (losses) included in the Condensed Consolidated Income Statements for the quarter and nine months ended June 30, 2023, were $46,000 and $4,490,000, respectively.

The carrying amounts of cash and cash equivalents, accounts receivable, acco

unt

s payable, customer deposits and accrued expenses approximate fair value because of the short-term nature of these items.

Inventories

Inventories are valued at the lower of cost or net realizable value with cost being determined under the first in, first out method and net realizable value defined as the estimated selling price of goods less reasonable costs of completion and delivery. Appropriate consideration is given to obsolescence, excessive levels, deterioration, possible alternative uses and other factors in determining net realizable value. The cost of work in process and finished goods includes materials, direct labor, variable costs and overhead. The Company evaluates the need to record inventory adjustments on all inventories, including raw material, work in process, finished goods, spare parts and used equipment. Used equipment acquired by the Company on

trade-in

from customers is carried at estimated net realizable value. Unless specific circumstances warrant different treatment regarding inventory obsolescence, an allowance is established to reduce the cost basis of inventories

three

to four years old by 50%, the cost basis of inventories

four

to five years old by 75%, and the cost basis of inventories greater than five years old to zero. Inventory is typically reviewed for obsolescence on an annual basis computed as of September 30, the Company’s fiscal year end. If significant known changes in trends, technology or other specific circumstances that warrant consideration occur during the year, then the impact on obsolescence is considered at that time.

- Definition

Disclosure of inventory accounting policy for inventory classes, including, but not limited to, basis for determining inventory amounts, methods by which amounts are added and removed from inventory classes, loss recognition on impairment of inventories, and situations in which inventories are stated above cost.

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