Note 4 - Detail of Certain Asset Accounts

3 Months Ended

Jun. 27, 2014

Details Of Certain Balance Sheet Accounts Disclosure [Abstract]

Details Of Certain Balance Sheet Accounts Disclosure [Text Block]

Note 4. Detail of Certain Asset Accounts

Cash and Cash Equivalents - The Company considers all highly liquid investments, with an original maturity of three months or less when purchased, to be cash equivalents.

Inventories - Inventories, which include material, labor and manufacturing overhead, are stated at the lower of cost (on a first in, first out method) or market. Inventories consist of the following at June 27, 2014 and March 31, 2014:

	June 27, 2014		March 31, 2014
Raw material	$	2,694,000	$	3,093,000
Work-in-process		1,039,000		954,000
Finished products		952,000		702,000
Inventories, net	$	4,685,000	$	4,749,000

Slow moving and obsolete inventories are reviewed throughout the year to assess whether a cost adjustment is required. Our review of slow moving and obsolete inventory begins with a listing of all inventory items which have not moved regularly within the past 12 months. In addition, any residual inventory, which is customer specific and remaining on hand at the time of contract completion, is included in the list. The complete list of slow moving and obsolete inventory is then reviewed by the production, engineering and/or purchasing departments to identify items that can be utilized in the near future. These items are then excluded from the analysis and the remaining amount of slow-moving and obsolete inventory is then further assessed and a write down is recorded when warranted. Additionally, non-cancelable open purchase orders for parts we are obligated to purchase where demand has been reduced may also be reserved. Impairments for open purchase orders where the market price is lower than the purchase order price are also recorded. The impairments established for excess, slow moving, and obsolete inventory create a new cost basis for those items. The cost basis of these parts is not subsequently increased if the circumstances which led to the impairment change in the future. If a product that had previously been impaired is subsequently sold, the amount of reduced cost basis is reflected as cost of goods sold.

Intangible Assets - Intangible assets that have definite lives consist of the following (dollars in thousands):

	Weighted Average		June 27, 2014
	Lives in Years		Amortization Method	Carrying Value		Accumulated Amortization		Intangibles Net
Customer list		15	Straight Line	$	190	$	116	$	74
Trademarks		15	Cash Flow		2,270		1,309		961
Technology		10	Cash Flow		10,950		10,705		245
Distribution Rights		7	Straight Line		148		28		120
Patents pending					603		--		603
Patents		10	Straight Line		1,335		566		769
Total Intangibles				$	15,496	$	12,724	$	2,772

	Weighted  Average		March 31, 2014
	Lives in Years		Amortization Method	Carrying Value		Accumulated Amortization		Intangibles Net
Customer list		15	Straight Line	$	190	$	113	$	77
Trademarks		15	Cash Flow		2,270		1,267		1,003
Technology		10	Cash Flow		10,950		10,672		278
Distribution Rights		7	Straight Line		148		23		125
Patents pending					795		--		795
Patents		10	Straight Line		1,108		444		664
Total Intangibles				$	15,461	$	12,519	$	2,942

Amortization expense for the three-month periods ended June 27, 2014 and June 28, 2013 was approximately $205,000 and $250,000, respectively. The current patents held by the Company have remaining useful lives ranging up to 20 years.

The cash flow method of amortization is based upon management’s estimate of how the intangible asset contributes to our cash flows and best represents the pattern of how the economic benefits of the intangible asset will be consumed or used up. Such amortization is initially derived from the estimated undiscounted cash flows that were used in determining the original fair value of the intangible asset at the acquisition date and is monitored for significant changes in subsequent periods.

Assuming no impairment to the intangible value, future amortization expense for intangible assets and patents, excluding patents pending, are as follows by fiscal year (in thousands):

Intangible Assets and Patents
Remainder of 2015	$	368
2016		489
2017		336
2018		332
2019		325
2020 & after		319
Total	$	2,169

Patent pending costs of $603,000 are not included in the future amortization chart above. These costs will be amortized beginning the month the patents are granted.