Note D - Marketable Securities and Time Deposits

9 Months Ended

Sep. 30, 2016

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

NOTE D—MARKETABLE SECURITIES and time deposits

The Company accounts for investments in marketable securities in accordance with FASB ASC No.320-10 “Investments in Debt and Equity Securities.” Management determines the appropriate classification of its investments in government and corporate marketable debt securities at the time of purchase and reevaluates such determinations at each balance sheet date.

The Company classifies marketable securities as available-for-sale. Available-for-sale securities are carried at fair value, with the unrealized gains and losses, net of taxes, reported in other comprehensive income. The amortized cost of marketable securities is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization and interest are included in financial income, net. Interest and dividends on securities are included in financial income, net. The following is a summary of available-for-sale securities at September 30, 2016 and December 31, 2015:

	Amortized cost				Unrealized gains (losses), net						Fair value
	September 30, 2016		December 31, 2015		September 30, 2016			December 31, 2015			September 30, 2016		December 31, 2015
	(Unaudited)		(Audited)		(Unaudited)			(Audited)			(Unaudited)		(Audited)
Short term deposits		5,707	$	5,568	$	-		$	-		$	5,707	$	5,568
U.S. GSE securities		24,305		23,645		(45	)		(114	)		24,260		23,531
Corporate obligations		76,698		79,072		(83	)		(387	)		76,615		78,685
	$	106,710	$	108,285	$	(128	)	$	(501	)	$	106,582	$	107,784

The

amortized cost of marketable debt securities and short-term deposits at September

 30, 2016, by contractual maturities, is shown below

:

			Unrealized gains (losses)
	Amortized cost		Gains		Losses			Fair value
Due in one year or less	$	25,480	$	17	$	(65	)	$	25,432
Due after one year to five years		81,230		165		(245	)		81,150
	$	106,710	$	182	$	(310	)	$	106,582

The actual

maturity dates may differ

from the contractual maturities because debtors may have the right to call or prepay obligations without penalties.

Management believes that as of September 30, 2016, the unrealized losses in the Company’s investments in all types of marketable securities were temporary and no impairment loss was realized in the Company’s condensed consolidated statement of income.

The unrealized losses related to all types of marketable securities were primarily due to changes in interest rates. Because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at September 30, 2016.

The total fair value of marketable securities with outstanding unrealized losses as of September 30, 2016 amounted to $67,430, while the unrealized losses for these marketable securities amounted to $310. Of the $310 unrealized losses outstanding as of September 30, 2016, a portion of which in the amount of $99 related to marketable securities that were in a loss position for more than 12 months and the remaining portion in the amount of $211 was related to marketable securities that were in a loss position for less than 12 months.

Proceeds from maturity of available-for-sale marketable securities during the nine months ended September 30, 2016 and 2015 were $34,265 and $14,157, respectively. Proceeds from sales of available-for-sale marketable securities during the nine months ended September 30, 2016 and 2015 were $13,072 and $11,492, respectively. Net realized loss from the sale of available-for-sale securities for the nine months ended September 30, 2016 were $17 compared to net realized loss for the nine months ended September 30, 2015 of $26. The Company determines realized gains or losses on the sale of marketable securities based on a specific identification method.

Marketable securities are periodically reviewed for impairment. If management concludes that any marketable security is impaired, management determines whether such impairment is other-than-temporary. Factors considered in making such a determination include the duration and severity of the impairment, the reason for the decline in value and the potential recovery period, and the Company’s intent to sell, or whether it is more likely than not that the Company will be required to sell the marketable security before recovery of cost basis. If any impairment is considered other-than-temporary, the marketable security is written down to its fair value through a corresponding charge to financial income, net.