Related Party Transactions

3 Months Ended

Jul. 31, 2012

Related Party Transactions [Abstract]

Related Party Transactions:

Note 7 - Related Party Transactions:

Investment Management (overview):

On December 23, 2010, the Company deconsolidated its asset management and mutual fund distribution businesses and its interest in these businesses was restructured as a non-voting revenues and non-voting profits interests in EAM. Accordingly, the Company no longer reports this operation as a separate business segment, although it still maintains a significant interest in the cash flows generated by this business and will receive non-voting revenues and non-voting profits interests going forward, as discussed below. Total assets in the Value Line Funds managed by EAM at July 31, 2012, were $2.0 billion, 6.0% below total assets of $2.15 billion in the Value Line Funds managed by EAM at July 31, 2011, as a result of net redemptions within the funds. The decrease in Value Line U.S. Government Money Market Fund (“USGMMF”) assets is primarily a result of the low interest rate environment.

The non-voting revenues and 90% of the Company’s non-voting profits interests due from EAM to the Company are payable each quarter under the provisions of the EAM Trust Agreement. The distributable amounts earned through the balance sheet date, which is included in the Investment in EAM Trust on the Consolidated Condensed Balance Sheets, and not yet paid, were $1,482,000 and $497,000 at July 31, 2012 and April 30, 2012, respectively.

EAM Trust - VLI’s non-voting revenues and non-voting profits interests:

The Company holds non-voting revenues and non-voting profits interests in EAM which entitle the Company to receive from EAM an amount ranging from 41% to 55% of EAM’s investment management fee revenues from its mutual fund and separate accounts business. EAM currently has no separately managed account clients. During the three months ended July 31, 2012, the Company recorded income of $1,473,000, consisting of $1,394,000, from its non-voting revenues interest in EAM and $79,000, from its non-voting profits interest in EAM without incurring any directly related expenses. During the three months ended July 31, 2011, the Company recorded income of $1,572,000, consisting of $1,491,000, from its non-voting revenues interest in EAM and $81,000 from its non-voting profits interests in EAM. During the period from December 23, 2010 until May 28, 2011, EAM occupied a portion of the premises that the Company leases from a third party. The Company received $44,000 for the month of May, 2011 for rent and certain accounting and other administrative support services provided to EAM on a transitional basis during such period.

Transactions with Parent:

During the three months ended July 31, 2012 and 2011, the Company was reimbursed $0 and $101,000, respectively, for payments it made on behalf of and for services the Company provided to the Parent. The Receivables from affiliates on the Consolidated Condensed Balance Sheets, included receivables from the Parent of $40,000 and $0 at July 31, 2012 and April 30, 2012, respectively.

The Company is a party to a tax-sharing arrangement with the Parent which allocates the tax liabilities of the two Companies between them. The Company made no Federal tax payments to the Parent during the three months ended July 31, 2012 or 2011. Prepaid and refundable income taxes on the Consolidated Condensed Balance Sheets included $101,000 and $530,000 of prepaid federal income tax due from the Parent at July 31, 2012 and April 30, 2012, respectively.

From time to time, the Parent has purchased additional shares of common stock of the Company in the market when and as the Parent has determined it to be appropriate. The Parent may make additional purchases of common stock of the Company from time to time in the future. As of July 31, 2012, the Parent owned approximately 87.2% of the outstanding shares of common stock of the Company.