5. Investments in Foreign Joint Ventures

We have interests in three joint ventures outside of the United States of America (“U.S.”) which are accounted for on the equity method:

—	BOMAY Electric Industries Company, Ltd. (“BOMAY”), in which the Company holds a 40% interest, Baoji Oilfield Machinery Co., Ltd. (a subsidiary of China National Petroleum Corporation) holds a 51% interest, and AA Energies, Inc., holds a 9% interest;

—	M&I Electric Far East, Ltd. (“MIEFE”), in which the Company holds a 41% interest, MIEFE’s general manager holds a 8% interest and, Sonepar, (private company) of France holds a 51% interest, and;

—	AETI Alliance Group do Brazil Sistemas E Servicos Em Energia LTDA. (“AAG”), in which the Company holds a 49% interest, and Beppe Hans Eddy Askerbo, of Brazil, holds a 51% interest.

Sales to joint ventures are made on an arm’s length basis.

Summary financial information of our foreign joint ventures in U.S. dollars was as follows at March 31, 2014 (unaudited) and December 31, 2013 and the three months ended March 31, 2014 and 2013 (in thousands):

	BOMAY				MIEFE				AAG
	2014		2013		2014		2013		2014		2013
Assets:
Total current assets	$	96,995	$	107,257	$	4,273	$	4,287	$	1,558	$	3,695
Total non-current assets		5,006		5,059		115		115		518		823
Total assets	$	102,001	$	112,316	$	4,388	$	4,402	$	2,076	$	4,518
Liabilities and equity:
Total liabilities	$	74,196	$	85,858	$	1,690	$	1,800	$	989	$	2,163
Total joint ventures’ equity		27,805		26,458		2,698		2,602		1,087		2,355
Total liabilities and equity	$	102,001	$	112,316	$	4,388	$	4,402	$	2,076	$	4,518

	Three Months Ended March 31,
	BOMAY				MIEFE				AAG
	2014		2013		2014		2013		2014			2013

Revenue	$	19,604	$	33,509	$	824	$	2,667	$	782		$	3,485
Gross Profit	$	2,935	$	4,288	$	359	$	482	$	109		$	1,556
Earnings	$	1,371	$	2,502	$	94	$	48	$	(73	)	$	891

The following is a summary of activity in investments in foreign joint ventures for the three months ended March 31, 2014, (unaudited):

	March 31, 2014
	BOMAY			MIEFE			AAG			TOTAL
	(in thousands)
Investments in foreign joint ventures:
Balance at December 31, 2013	$	10,609		$	1,138		$	1,286		$	13,033
Equity in earnings (loss) in 2014		548			(38	)		(36	)		474
Dividend distributions in 2014	—			—				(830	)		(830	)
Foreign currency translation adjustment		(31	)		8			171			148
Investments, end of period	$	11,126		$	1,108		$	591		$	12,825

Components of investments in foreign joint ventures:
Investment in joint ventures	$	2,033		$	15		$	54		$	2,102
Undistributed earnings		7,693			831			615			9,139
Foreign currency translation		1,400			262			(78	)		1,584
Investments, end of period	$	11,126		$	1,108		$	591		$	12,825

Accumulated statutory reserves in equity method investments of $1.9 million at March 31, 2014 and December 31, 2013 are included in AETI’s consolidated retained earnings. In accordance with the People’s Republic of China, (“PRC”), regulations on enterprises with foreign ownership, an enterprise established in the PRC with foreign ownership is required to provide for certain statutory reserves, namely (i) General Reserve Fund, (ii) Enterprise Expansion Fund and (iii) Staff Welfare and Bonus Fund, which are appropriated from net profit as reported in the enterprise’s PRC statutory accounts. A non-wholly-owned foreign invested enterprise is permitted to provide for the above allocation at the discretion of its board of directors. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends.

Under the equity method, the Company’s share of the joint ventures’ operations’ earnings or loss is recognized in the condensed consolidated statement of operations as equity income (loss) from foreign joint ventures’ operations. Joint venture income increases the carrying value of the joint venture investment and joint venture losses, as well as dividends received from the joint ventures, reduce the carrying value of the investment. Each reporting period, the Company evaluates the carrying value of these equity method investments as to whether an impairment adjustment may be necessary. In making this evaluation, a variety of quantitative and qualitative factors are considered including national and local economic, political and market conditions, industry trends and prospects, liquidity and capital resources and other pertinent factors. Based on this evaluation for this reporting period, the Company does not believe an impairment adjustment is necessary.