Note 4 - Detail of Certain Asset Accounts

9 Months Ended

Dec. 26, 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 December 26, 2014 and March 31, 2014:

	December 26, 2014		March 31, 2014
Raw material	$	3,031,000	$	3,093,000
Work-in-process		848,000		954,000
Finished products		1,108,000		702,000
Inventories, net	$	4,987,000	$	4,749,000

Slow moving and obsolete inventories are reviewed during 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	December 26, 2014
	Lives in  Years	Amortization  Method	Carrying Value		Accumulated Amortization		Intangibles Net
Customer list	15	Straight Line	$	190	$	122	$	68
Trademarks	15	Cash Flow		2,270		1,394		876
Technology	10	Cash Flow		10,950		10,851		99
Distribution Rights	7	Straight Line		148		39		109
Patents pending				729		--		729
Patents	10	Straight Line		1,449		652		797
Total Intangibles			$	15,736	$	13,058	$	2,678

	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 December 26, 2014 and December 27, 2013 was $153,000 and $260,000, respectively. The current patents held by the Company have remaining useful lives ranging from 2 years to 20 years. Amortization expense for the nine-month periods ended December 26, 2014 and December 27, 2013 was $539,000 and $769,000, respectively.

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	$	154
2016		396
2017		351
2018		347
2019		337
2020 & after		364
Total	$	1,949

Patent pending costs of $729,000 are not included in the future amortization chart above. These costs will be amortized beginning the month the patents are granted.