DERIVATIVE FINANCIAL INSTRUMENTS

9 Months Ended

Dec. 31, 2011

DERIVATIVE FINANCIAL INSTRUMENTS [Abstract]

DERIVATIVE FINANCIAL INSTRUMENTS

NOTE 10 – DERIVATIVE FINANCIAL INSTRUMENTS

On December 8, 2008, the Company entered into an interest rate swap with a notional amount of $20 million to economically hedge a portion of the cash flows from its floating rate revolving credit facility.  Under the terms of the interest rate swap, which expired on December 8, 2011, the Company paid a fixed rate of 2.4% on the $20 million notional amount and received payments from a counterparty based on the 1 month LIBOR rate.  Interest rate differentials paid or received under the swap agreement were recognized as adjustments to interest expense.

The fair value of the Company's interest rate derivative instrument is included in the Consolidated Balance Sheets as follows:

	Interest Rate Swap
March 31, 2011:
Accounts payable and accrued expenses	$	319,235
Fair value of derivative instrument	$	319,235

The gains (losses) recognized in the Company's Consolidated Statements of Operations as a result of the Company's interest rate swap is as follows:

	Three months ended						Nine months ended
	December 31,						December 31,
	2011			2010			2011			2010
Realized losses
Interest rate swap - included as a component of interest expense	$	(82,716	)		(128,225	)		(305,459	)		(1,021,848	)
Unrealized gains
Interest rate swap - included as a component of other income	$	108,975			208,225			319,235			920,537

The Company does not enter into derivative financial instruments for trading or speculative purposes.  The purpose of these instruments is to reduce the exposure to variability in future cash flows attributable to a portion of its LIBOR-based borrowings.  The Company is currently not accounting for these derivative instruments using the cash flow hedge accounting provisions of FASB ASC Topic 815-10-15; therefore, the changes in fair value of the swaps are included in earnings as other income or expenses.

By using derivative instruments, the Company is exposed to credit and market risk.  Credit risk, which is the risk that a counterparty to a derivative instrument will fail to perform, exists to the extent of the fair value gain in a derivative.  Market risk is the adverse effect on the financial instruments from a change in interest rates.  The Company manages the market risk associated with interest rate contracts by establishing and monitoring limits as to the types and degree of risk that may be undertaken.  The market risk associated with derivatives used for interest rate risk management activities is fully incorporated in the Company's market risk sensitivity analysis.