NOTE 4. Inventories

Inventories are summarized as follows:


	September 30,			March 31,
	2011			2011
Finished goods	$	1,105		$	895
Work in process		7,210			6,007
Purchased and manufactured parts		13,955			10,460

		22,270			17,362
Reserve for slow moving and obsolescence		(2,761	)		(2,611	)

Total	$	19,509		$	14,751

Inventory obsolescence is determined by identifying specific items based on the age of inventory and by establishing a general reserve based on annual purchases. Analyzing inventory by age showed little movement once items have aged five years, and historical trends showed that 1.1% of purchases would eventually be scrapped. Accordingly, the Company used these two factors in determining the amount of the reserve.