Pensions and Other Postretirement Benefits

12 Months Ended

Jun. 30, 2017

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

Pensions and Other Postretirement Benefits

11.

Pensions and Other Postretirement Benefits

Defined Contribution Plans

We maintain a retirement savings plan available to U.S. employees that qualifies as a defined contribution plan under Section 401(k) of the IRC. From July 1, 2012 through August 20, 2013, we matched 25% of the first 5% of the participants’ compensation. Effective August 21, 2013, we match 50% of the first 5% of the participants’ compensation. For fiscal years 2017 and 2016, we made matching contributions of $272 and $279, respectively.

The sale of our Real-Time business in May 2017 (see Note 4 – Discontinued Operations) triggered a “partial plan termination” of our domestic 401(k) plan as defined under Section 411(d)(3) of the IRC. As a result, previously forfeited matching contributions for all voluntary and involuntarily terminated employees during the 401(k) plan year for 2017 (January 1, 2017 through December 31, 2017) are to be reinstated. Through June 30, 2017, $77 in previously forfeited matching contributions for the 2017 plan year were reinstated; however, such reinstatement did not result in any incremental expense to us as we had not repurposed the matching funds as of the partial plan termination date. Management believes that the amount of forfeitures to be reinstated for the balance of 2017 plan year will not be material.

We also maintain a defined contribution plan (the “Stakeholder Plan”) for our U.K. based employees. The Stakeholder Plan provides for discretionary matching contributions of between 4% and 7% of the employee’s salary. For fiscal years 2017 and 2016 we made total contributions to the Stakeholder Plan of $35 and $43, respectively.

Defined Benefit Plans

As of June 30, 2017, we maintained the Pension Plans covering former employees in Germany. The measurement date used to determine fiscal years’ 2017 and 2016 benefit information for the Pension Plans was June 30, 2017 and 2016, respectively. Our Pension Plans have been closed to new employees since 1998 and no existing employees are eligible to participate, as all eligible participants are no longer employed by us.

A reconciliation of the changes in the Pensions Plans’ benefit obligations and fair value of plan assets over the two-year period ended June 30, 2017, and a statement of the funded status at June 30, 2017 for these years for the Pension Plans is as follows:

Obligations and Funded Status

	June 30,
	2017		2016

Change in benefit obligation:
Benefit obligation at beginning of year	$	4,919	$	4,628
Interest cost		50		96
Actuarial (gain) loss		(256)		435
Foreign currency exchange rate change		133		4
Benefits paid		(236)		(244)
Benefit obligation at end of year	$	4,610	$	4,919

Change in plan assets:
Fair value of plan assets at beginning of year	$	1,192	$	1,432
Actual return on plan assets		19		(15)
Employer contributions		14		12
Benefits paid		(229)		(237)
Foreign currency exchange rate change		25		-
Fair value of plan assets at end of year	$	1,021	$	1,192
Funded status at end of year	$	(3,589)	$	(3,727)

Amounts Recognized in the Consolidated Balance Sheets

	June 30,
	2017		2016

Other accrued expenses ⁽¹⁾	$	(7)	$	(7)
Pension liability - long-term liabilities		(3,582)		(3,720)
Total pension liability	$	(3,589)	$	(3,727)

Accumulated other comprehensive loss	$	1,345	$	1,637

⁽¹⁾ Included in line item accounts payable and accrued expenses

Items Not Yet Recognized as a Component of Net Periodic Pension Cost:

	June 30,
	2017		2016

Net loss	$	1,345	$	1,637
	$	1,345	$	1,637

Information for Pension Plans with an Accumulated Benefit Obligation in Excess of Plan Assets

	June 30,
	2017		2016

Projected benefit obligation	$	4,610	$	4,919
Accumulated benefit obligation	$	4,610	$	4,919
Fair value of plan assets	$	1,021	$	1,193

The following table provides the components of net periodic pension cost recognized in earnings for the fiscal years ended June 30, 2017 and 2016:

Components of Net Periodic Benefit Cost and Other Amounts Recognized in Other Comprehensive Income

	Year Ended June 30,
	2017		2016

Net Periodic Benefit Cost
Service cost	$	-	$	-
Interest cost		50		96
Expected return on plan assets		(15)		(22)
Recognized actuarial loss		76		50
Amortization of unrecognized net transition obligation (asset)		-		-
Net periodic benefit cost	$	111	$	124

We estimate that $62 of the net loss for the defined benefit pension plans will be amortized from accumulated other comprehensive income into net period benefit cost in fiscal year 2018.

Assumptions

The following table sets forth the assumptions used to determine benefit obligations:

	June 30,
	2017			2016

Discount rate		1.55	%		1.07	%
Expected return on plan assets		2.00	%		2.50	%
Compensation increase rate		0.00	%		0.00	%

The following table sets forth the assumptions used to determine net periodic benefit cost:

	Year Ended June 30,
	2017			2016

Discount rate		1.07	%		2.13	%
Expected return on plan assets		2.50	%		2.50	%
Compensation increase rate		0.00	%		0.00	%

On an annual basis, we adjust the discount rate used to determine the projected benefit obligation to approximate rates on high-quality, long-term obligations.

Plan Assets

The following table sets forth, by level within the fair value hierarchy, a summary of the defined benefit plan’s assets measured at fair value, as well as the percentage of total plan assets for each category at June 30, 2017:

									Percentage of
							Total		Plan Assets
	Level 1		Level 2		Level 3		Assets		2017

Asset Category:
Cash and cash equivalents	$	42	$	-	$	-	$	42		4.1	%
Equity securities		-		432		-		432		42.3	%
Cash surrender value insurance contracts		-		547		-		547		53.6	%
Totals	$	42	$	979	$	-	$	1,021		100.0	%

									Percentage of
							Total		Plan Assets
	Level 1		Level 2		Level 3		Assets		2016

Asset Category:
Cash and cash equivalents	$	8	$	-	$	-	$	8		0.7	%
Equity securities		-		572		-		572		47.9	%
Debt securities		-		57		-		57		4.8	%
Cash surrender value insurance contracts		-		556		-		556		46.6	%
Totals	$	8	$	1,185	$	-	$	1,193		100.0	%

Pension assets utilizing Level 1 inputs include fair values of equity investments and debt securities, and related dividends, which were determined by closing prices for those securities traded actively on national stock exchanges. All cash equivalents are carried at cost, which approximates fair value. Level 2 assets include fair values of equity investments and debt securities with limited trading activity and related dividends that were determined by closing prices for those securities traded on national stock exchanges and cash surrender life insurance contracts that are valued based on contractually stated settlement value. In estimating the expected return on plan assets, we consider past performance and future expectations for the fund. Defined benefit plan assets are heavily weighted toward equity investments that yield consistent, dependable dividends.

Our investment strategy with respect to pension assets is to invest the assets in accordance with applicable laws and regulations. The long-term primary objectives for our pension assets are to: (1) provide for a reasonable amount of long-term growth of capital, with prudent exposure to risk and protect the assets from erosion of purchasing power; (2) provide investment results that meet or exceed the plans’ actuarially assumed long-term rate of return; and (3) match the duration of the liabilities and assets of the plans to reduce the potential risk of large employer contributions being necessary in the future.

Contributions

We expect to contribute $13 to our defined benefit pension plans in fiscal year 2018.

Estimated Future Benefit Payments

Expected benefit payments, which reflect expected future service, during the next ten fiscal years ending June 30 are as follows:

	Pension
	Benefits

2018		248
2019		251
2020		249
2021		247
2022		245
2023 - 2027		1,203