7. Short-Term and Long-Term Investments

As of June 30, 2017 and 2016, we held short-term restricted cash and at June 30, 2016 we also held long-term bank guarantees. The restricted cash and guarantees provide financial assurance that we will fulfill certain customer obligations in China. The cash is restricted as to withdrawal or use while the related bank guarantee is outstanding. Interest is earned on the restricted cash and recorded as interest income. As of June 30, 2017 and June 30, 2016 we had short-term bank guarantees of $239,000 and $77,000 respectively, and long-term bank guarantees of zero and $45,000 respectively.

At June 30, 2017, we held a long-term investment in preferred stock that is not registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The preferred stock investment is currently recorded at $725,000 after consideration of impairment charges recorded in fiscal 2008 and 2009. We estimated that the fair market value of this investment at June 30, 2017 exceeded $725,000 based on an internal valuation model which included the use of a discounted cash flow model. The fair market analysis considered the following key inputs, (i) the underlying structure of the security; (ii) the present value of the future principal discounted at rates considered to reflect current market conditions; and (iii) the time horizon that the market value of the security could return to its cost and be sold. Under ASC 820, “Fair Value Measurements”, such valuation assumptions are defined as Level 3 inputs.

The following table presents our Short-Term and Long-Term Investments by category at June 30, 2017 and 2016 (in thousands):


	June 30, 2017
Short-Term Investments	Cost		Fair Value or Carrying Value
Restricted Cash	$	239	$	239
Mutual Funds		-		-
Time/Fixed Deposits		1,333		1,333
Total Short-Term Investments	$	1,572	$	1,572

Long-Term Investments
Time Deposits	$	-	$	-
Preferred Stock		3,700		725
Total Long-Term Investments	$	3,700	$	725

Total Investments	$	5,272	$	2,297


	June 30, 2016
Short-Term Investments	Cost		Fair Value or Carrying Value
Restricted Cash	$	77	$	77
Mutual Funds		29		29
Time/Fixed Deposits		1,368		1,368
Total Short-Term Investments	$	1,474	$	1,474

Long-Term Investments
Time Deposits	$	45	$	45
Preferred Stock		3,700		725
Total Long-Term Investments	$	3,745	$	770

Total Investments	$	5,219	$	2,244