Investments

3 Months Ended

Sep. 30, 2011

Note 3. Investments

As of September 30, 2011, the Company held investments with a market value of approximately $9.1 million and a cost basis of approximately $9.0 million. The market value of these investments is approximately 20.2 percent of the Company’s total assets.

Investments in securities classified as trading are reflected as current assets on the consolidated balance sheet at their fair market value. Unrealized holding gains and losses on trading securities are included in earnings in the consolidated statements of operations and comprehensive income.

Investments in securities classified as available-for-sale, which may not be readily marketable, are reflected as non-current assets on the consolidated balance sheet at their fair value. Unrealized holding gains and losses on available-for-sale securities are excluded from earnings and reported in other comprehensive income as a separate component of shareholders’ equity until realized.

The Company records security transactions on trade date. Realized gains (losses) from security transactions are calculated on the first-in/first-out cost basis, unless otherwise identifiable, and are recorded in earnings on the date of sale.

The following summarizes the market value, cost, and unrealized gain or loss on investments as of September 30, 2011, and June 30, 2011.


								Unrealized holding
								gains on available-for-
Securities	Market Value		Cost		Unrealized Gain			sale securities,
					(Loss)			net of
								tax
Trading¹	$	5,109,717	$	5,960,634	$	(850,917	)		N/A
Available-for-sale²		3,996,444		3,083,735		912,709		$	602,388

Total at September 30, 2011	$	9,106,161	$	9,044,369	$	61,792


Trading¹	$	5,703,916	$	5,963,272	$	(259,356	)		N/A
Available-for-sale²		4,660,928		3,081,439		1,579,489		$	1,042,462

Total at June 30, 2011	$	10,364,844	$	9,044,711	$	1,320,133


¹ Unrealized and realized gains and losses on trading securities are included in earnings in the statement of operations.

² Unrealized gains and losses on available-for-sale securities are excluded from earnings and recorded in other comprehensive income as a separate component of shareholders’ equity until realized.

The following details the components of the Company’s available-for-sale investments as of September 30, 2011, and June 30, 2011.


	September 30, 2011 (in thousands)
			Gross Unrealized
	Cost		Gains		(Losses)			Market Value
Available-for-sale securities
Common stock	$	920	$	424	$	(21	)	$	1,323
Venture capital investments		134		139		(13	)		260
Mutual funds		2,030		385		(2	)		2,413

Total available-for-sale securities	$	3,084	$	948	$	(36	)	$	3,996


	June 30, 2011 (in thousands)
			Gross Unrealized
	Cost		Gains		(Losses)			Market Value
Available-for-sale securities
Common stock	$	917	$	777	$	(4	)	$	1,690
Venture capital investments		134		122		(13	)		243
Mutual funds		2,030		698		-			2,728

Total available-for-sale securities	$	3,081	$	1,597	$	(17	)	$	4,661

The following tables show the gross unrealized losses and fair values of available-for-sale investment securities with unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:


	September 30, 2011 (in thousands)
	Less Than 12 Months					12 Months or Greater				Total
			Gross					Gross				Gross
			Unrealized					Unrealized				Unrealized
	Fair Value		Losses			Fair Value		Losses		Fair Value		Losses
Available-for-sale securities
Common stock	$	109	$	(21	)	$	-	$	-	$	109	$	(21	)
Venture capital investments		112		(13	)		-		-		112		(13	)
Mutual funds		18		(2	)		-		-		18		(2	)

Total available-for-sale securities	$	239	$	(36	)	$	-	$	-	$	239	$	(36	)


	June 30, 2011 (in thousands)
	Less Than 12 Months					12 Months or Greater				Total
			Gross					Gross				Gross
			Unrealized					Unrealized				Unrealized
	Fair Value		Losses			Fair Value		Losses		Fair Value		Losses
Available-for-sale securities
Common stock	$	31	$	(4	)	$	-	$	-	$	31	$	(4	)
Venture capital investments		112		(13	)		-		-		112		(13	)
Mutual funds		-		-			-		-		-		-

Total available-for-sale securities	$	143	$	(17	)	$	-	$	-	$	143	$	(17	)

Investment income can be volatile and varies depending on market fluctuations, the Company’s ability to participate in investment opportunities, and timing of transactions. A significant portion of the unrealized gains and losses for the three months ended September 30, 2011, is concentrated in a small number of issuers. The Company expects that gains and losses will continue to fluctuate in the future.

Investment income (loss) from the Company’s investments includes:

	•		realized gains and losses on sales of securities;

	•		unrealized gains and losses on trading securities;

	•		realized foreign currency gains and losses;

	•		other-than-temporary impairments on available-for-sale securities; and

	•		dividend and interest income.

The following summarizes investment income reflected in earnings for the periods discussed:


Investment Income	Three Months Ended September 30,
	2011			2010
Realized gains on sales of available-for-sale securities	$	-		$	1,303
Realized losses on sales of trading securities		(2,638	)		-
Unrealized gains (losses) on trading securities		(591,562	)		455,146
Realized foreign currency losses		(36	)		(1,431	)
Other-than-temporary declines in available-for-sale securities		(37	)		-
Dividend and interest income		42,398			24,833

Total Investment Income	$	(551,875	)	$	479,851