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Note C - Investment Securities

12 Months Ended

Sep. 26, 2015

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

NOTE C – INVESTMENT SECURITIES

We have classified our investment securities as marketable securities held to maturity and available for sale. The FASB defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the FASB has established three levels of inputs that may be used to measure fair value:

Level 1

observable input such as quoted prices in active markets for identical assets or liabilities;

Level 2

Observable inputs, other than Level 1 inputs in active markets, that are observable either directly or indirectly; and

Level 3

Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions.

Our marketable securities held to maturity and available for sale consist of investments in mutual funds, preferred stock and corporate bonds. The fair values of mutual funds are based on quoted market prices in active markets and are classified within Level 1 of the fair value hierarchy. The fair values of preferred stock and corporate bonds are based on quoted prices for identical or similar instruments in markets that are not active. As a result, preferred stock and corporate bonds are classified within Level 2 of the fair value hierarchy.

The amortized cost, unrealized gains and losses, and fair market values of our investment securities held to maturity at September 26, 2015 are summarized as follows:

						Gross				Gross				Fair
		Amortized				Unrealized				Unrealized				Market
		Cost				Gains				Losses				Value
		(in thousands)
Corporate Bonds		$	66,660			$	15			$	663			$	66,012
Total investment securities held to maturity		$	66,660			$	15			$	663			$	66,012

The amortized cost, unrealized gains and losses, and fair market values of our investment securities available for sale at September 26, 2015 are summarized as follows:

						Gross				Gross				Fair
		Amortized				Unrealized				Unrealized				Market
		Cost				Gains				Losses				Value
						(in thousands)

Mutual Funds		$	20,041			$	-			$	827			$	19,214
Preferred Stock			20,473				114				163				20,424
Total investment securities available for sale		$	40,514			$	114			$	990			$	39,638

The mutual funds seek current income with an emphasis on maintaining low volatility and overall moderate duration. We have reduced our investments in mutual funds over the past year to $19 million at September 2015 from $128 million at September 2014. The remaining unrealized losses at September 2015 of $827,000 are spread over 4 funds with total fair market value of $19.2 million. In 2015, sales of mutual funds generated a realized loss of $4.3 million. The Fixed-to-Floating Perpetual Preferred Stock generate fixed income to call dates in 2018, 2019 and 2025 and then income is based on a spread above LIBOR if the securities are not called. The mutual funds and Fixed-to-Floating Perpetual Preferred Stock do not have contractual maturities; however, we classify them as long term assets as it is our intent to hold them for a period of over one year, although we may sell some or all of them depending on presently unanticipated needs for liquidity or market conditions. In the fourth quarter we invested $67 million in corporate bonds which generate fixed income to maturity dates in 2017 through 2021, with $40 million maturing prior to the end of our fiscal year 2018. Our expectation is that we will hold the corporate bonds to their maturity dates and redeem them at our amortized cost.

The amortized cost, unrealized gains and losses, and fair market values of our investment securities held to maturity at September 27, 2014 are summarized as follows:

						Gross				Gross				Fair
		Amortized				Unrealized				Unrealized				Market
		Cost				Gains				Losses				Value
		(in thousands)
US Government Agency Debt		$	2,000			$	-			$	13			$	1,987


Total investment securities held to maturity		$	2,000			$	-			$	13			$	1,987

The amortized cost, unrealized gains and losses, and fair market values of our investment securities available for sale at September 27, 2014 are summarized as follows:

						Gross				Gross				Fair
		Amortized				Unrealized				Unrealized				Market
		Cost				Gains				Losses				Value
						(in thousands)

Mutual Funds		$	129,473			$	760			$	2,116			$	128,117


Total investment securities available for sale		$	129,473			$	760			$	2,116			$	128,117

The amortized cost and fair value of the Company’s held to maturity securities by contractual maturity at September 26, 2015 and September 27, 2014 are summarized as follows:

		September 26, 2015								September 27, 2014

		Amortized Cost				Fair Market Value				Amortized Cost				Fair Market Value
		(in thousands)
Due in one year or less		$	-			$	-			$	-			$	-
Due after one year through five years			63,522				63,010				-				-
Due after five years through ten years			3,138				3,002				2,000				1,987
Total held to maturity securities		$	66,660			$	66,012			$	2,000			$	1,987
Less current portion			-				-				-				-
Long term held to maturity securities		$	66,660			$	66,012			$	2,000			$	1,987

Proceeds from the sale and redemption of marketable securities were $110,117,000, $7,245,000 and $25,307,000 in the years ended September 26, 2015, September 27, 2014 and September 28, 2013, respectively; with losses of $4,319,000, $361,000 and $108,000 recorded in 2015, 2014 and 2013, respectively. We use the specific identification method to determine the cost of securities sold.

The entire disclosure for investments in certain debt and equity securities.

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