Concentrations:

12 Months Ended

Sep. 30, 2012

Concentrations:

Concentrations:

2. Concentrations:

Major Customers and Products

        In fiscal 2012, 2011 and 2010, the Company derived 63%, 61%, and 48%, respectively, of total sales from five customers, although not all the same customers in each year. Accounts receivable related to those top five customers was $1.7 million, $1.8 million, and $0.3 million as at September 30, 2012, 2011 and 2010, respectively.

        During fiscal 2012, three of the Company's customers, Eclipse Aerospace, FedEx, and National Nuclear Security Administration accounted for 20%, 14%, and 13% of total sales, respectively. In fiscal 2011, two of the Company's customers, Eclipse Aerospace and FedEx, accounted for 20% and 15% of total sales, respectively. In fiscal 2010, two of the Company's customers, Lockheed Martin and FedEx, accounted for 11% and 10% of total sales, respectively.

        Sales of air data systems and components were 13%, 21%, and 32% of total sales for the years ended September 30, 2012, 2011 and 2010, respectively. Flat Panel sales were 87%, 79%, and 68% of total sales in the years ended September 30, 2012, 2011 and 2010, respectively. Sales to government contractors and agencies accounted for approximately 45%, 30%, and 43% of total sales during fiscal years 2012, 2011 and 2010, respectively. While under these contracts the government agency or general contractor typically retains the right to terminate the contract at any time at its convenience, to date these contracts have generally included provisions requiring the payment to the Company of all revenue earned and costs incurred by the Company through the date of contract termination and do not entitle the customer to receive a refund of any previously paid fees.

        On November 29, 2011, AMR Corporation, the parent company of AAI and certain of its other U.S.-based subsidiaries filed voluntary petitions for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of New York. The Company's revenues from AAI accounted for 5%, 8% and 8% total revenue for the fiscal years 2012, 2011 and 2010, respectively. (See also Note 13—Commitments and Contingencies).

Major Suppliers

        The Company buys several of its components from sole source suppliers. Although there are a limited number of manufacturers of particular components, management believes other suppliers could provide similar components on comparable terms.

        During fiscal 2012 and 2011 the Company had one supplier who accounted for 20% and 27%, respectively, of the Company's total inventory purchases.

Concentration of Credit Risk

        Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash balances and accounts receivable. The Company invests its excess cash where preservation of principal is the major consideration. The Company's customer base consists principally of companies within the aviation industry. The Company may request advance payments and/or letters of credit from new customers or existing customers whose credit ratings do not meet the Company's standards for extending normal credit terms.

        The Company maintained reserves for doubtful accounts of $0.2 million and $0.2 million at September 30, 2012 and 2011, respectively. The reserve balances for both fiscal 2012 and 2011 related to sales of Engineering—Modification and Development services ("EMD") to a customer that was negatively impacted by the current economic environment. As of September 30, 2012, the Company had pre-Bankruptcy outstanding accounts receivable of $760,000 from AAI. Based on the present status of the Bankruptcy proceedings, the Company is not able to determine the amount, if any, that could be uncollectible. (See also Note 13—Commitments and Contingencies).