Note 8 - PRODUCT WARRANTIES

3 Months Ended

Aug. 31, 2011

Notes to Financial Statements

PRODUCT WARRANTIES

Note 8 - Product warranties

The Company provides for the estimated cost of product warranties at the time products are shipped. While the Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers, the Company’s warranty obligation is affected by product failure rates, material usage and service delivery costs incurred in correcting a product failure. Should actual product failure rates, material usage or service delivery costs differ from the Company’s estimates, revisions to the estimated warranty liability would be required.

The standard warranty period is ninety days for parts and service and one year for systems.

Following is a summary of changes in the Company's liability for product warranties during the three months ended August 31, 2011 and 2010 (in thousands):

		Three Months Ended
		August 31,
		2011	2010
Balance at the beginning of the period		$103	$174
Accruals for warranties issued during the period		55	21
Adjustments related to pre-existing warranties
	(including changes in estimates)	--	(88)
Settlement made during the period
	(in cash or in kind)	(58)	(13)
Balance at the end of the period		$100	$94

The accrued warranty balance is included in accrued expenses on the accompanying condensed consolidated balance sheets.