DISCONTINUED OPERATION AND CORRESPONDING RESTRUCTURING PLAN

3 Months Ended

Dec. 31, 2012

Notes to Financial Statements

Note 16 - DISCONTINUED OPERATION AND CORRESPONDING RESTRUCTURING PLAN (IN THOUSANDS, EXCEPT EARNINGS PER SHARE AND NUMBER OF SHARES)

The Company’s Shanghai operation, as a component of the Testing segment, suffered continued operating losses in the past three fiscal years and the cash flow was minimal for the past three years.  In January 2010, the Company established a restructuring plan to close the Testing operation in Shanghai, China.  Based on the restructuring plan and in accordance with ASC Topic 205-20 Presentation of Financial Statement Discontinued Operations the Company presented the operation results from Shanghai as a discontinued operation as the Company believed that no continued cash flow would be generated by the disposed component (Shanghai subsidiary) and that the Company would have no significant continuing involvement in the operation of the discontinued component. In accordance with the restructuring plan, before moving out of Shanghai the Company will be required to pay the outstanding balance of accounts payable of RMB 237, or approximately $38 based on the exchange rate as on December 31, 2012 published by the Monetary Authority of Singapore.

The Company did not incur any general administrative expenses for the three and six months ended December 31, 2012 and incurred approximately $1 and $2 for the three and six months ended December 31, 2011, respectively, for winding down the operation in Shanghai. The Company anticipates that it may incur additional costs and expenses in winding down the business of the subsidiary through which the China facility was operated.

Under the provision of ASC Topic 830, Foreign Currency Matters, translation adjustments that result when a foreign entity’s financial statements are translated into a parent company’s or an investor’s reporting currency are separately reported in the parent company’s other comprehensive income.  Foreign currency translation adjustments that are accumulated in other comprehensive income are reclassified to income only when they are realized, if the investment in the foreign entity is sold or is substantially or completely liquidated.  The foreign currency translation adjustments on the balance sheet of the Shanghai, China subsidiary as of December 31, 2012 were insignificant.

Loss from discontinued operations was as follows:

	Six Months Ended					Three Months Ended
	Dec. 31,		Dec. 31,			Dec. 31,		Dec. 31,
	2012		2011			2012		2011
	Unaudited		Unaudited			Unaudited		Unaudited
REVENUE	$	—	$	—		$	—	$	—
COST OF SALES		—		—			—		—
GROSS LOSS		—		—			—		—
OPERATING EXPENSES
General and administrative		—		2			—		1
Total		—		2			—		1
LOSS FROM DISCONTINUED OPERATION		—		(2	)		—		(1	)
OTHER INCOME		—		—			—		—
LOSS FROM DISCONTINUED OPERATIONS	$	—	$	(2	)	$	—	$	(1	)

The Company does not provide a separate cash flow statement for the discontinued operation, as the impact of this discontinued operation was immaterial.