DISCONTINUED OPERATION AND CORRESPONDING RESTRUCTURING PLAN

9 Months Ended

Mar. 31, 2012

Notes to Financial Statements

Note 17 - DISCONTINUED OPERATION AND CORRESPONDING RESTRUCTURING PLAN

The Company’s Shanghai operation, as a component of the Testing segment, suffered continued operating losses for three consecutive fiscal years and the cash flow was minimal for three consecutive years.  In January 2010, the Company established a restructuring plan to close the Testing operation in Shanghai, China.  Based on the restructuring plan and in accordance with ASC Topic 205-20, Presentation of Financial Statement Discontinued Operations, the Company presented the operation results from Shanghai as a discontinued operation, as the Company believed that no continued cash flow would be generated by the disposed component (Shanghai subsidiary) and that the Company would have no significant continuing involvement in the operation of the discontinued component. In accordance with the restructuring plan, before moving out of Shanghai, the Company will be required to pay the outstanding balance of accounts payable of RMB 237, or approximately $38 based on the exchange rate as on March 31, 2012 published by the Monetary Authority of Singapore.

The Company’s Shanghai operation did not incur general and administrative expenses for the three months ended March 31, 2012, however the general and administrative expenses for the nine months ended March 31, 2012 were $2, for winding down the operation in Shanghai. The Shanghai operations anticipate that it may incur additional costs and expenses in winding down the business of the subsidiary through which the China facility was operated.

Under the provisions of ASC Topic 830, Foreign Currency Matters, translation adjustments that result when a foreign entity’s financial statements are translated into a parent company’s or an investor’s reporting currency are separately reported in the parent company’s other comprehensive income.  Foreign currency translation adjustments that are accumulated in other comprehensive income are reclassified to income only when they are realized, if the investment in the foreign entity is sold or is substantially or completely liquidated.  The foreign currency translation adjustments on the balance sheet of the Shanghai, China subsidiary as of March 31, 2012 were insignificant.

Loss from discontinued operations was as follows:

	Nine Months Ended						Three Months Ended
	Mar. 31,			Mar. 31,			Mar. 31,		Mar. 31,
	2012			2011			2012		2011
	Unaudited			Unaudited			Unaudited		Unaudited
REVENUE	$	--		$	--		$	--	$	--
COST OF SALES		--			--			--		--
GROSS LOSS		--			--			--		--
OPERATING EXPENSES
General and administrative		2			2			--		--
Total		2			2					--
LOSS FROM DISCONTINUED OPERATION		(2	)		(2	)		--		--
OTHER EXPENSES		--			--			--		--
LOSS FROM DISCONTINUED OPERATIONS	$	(2	)	$	(2	)	$	--	$	--

The Company does not provide a separate cash flow statement for the discontinued operation, as the impact of this discontinued operation was immaterial.