Annual report pursuant to Section 13 and 15(d)

Short-Term Investments and Marketable Securities

v2.4.0.8
Short-Term Investments and Marketable Securities
 12 Months Ended
Nov. 30, 2013
Investments [Abstract]  
SHORT-TERM INVESTMENTS AND MARKETABLE SECURITIES
SHORT-TERM INVESTMENTS AND MARKETABLE SECURITIES
Short-term investments and marketable securities, which consist of fully guaranteed bank certificates of deposit, stock and various corporate and government obligations, are stated at market value. The Company has classified its investments as Available-for-Sale securities and considers as current assets those investments which will mature or are likely to be sold within the ensuing twelve months. The cost and market values of the investments at November 30, 2013 and November 30, 2012 were as follows:
 
 
November 30, 2013
 
November 30, 2012
 
 
COST
 
MARKET
 
COST
 
MARKET
Current:
 
 
 
 
 
 
 
 
Corporate obligations
 
$
—

 
$
—

 
$
1,004,490

 
$
995,827

Limited partnership
 
223,373

 
354,050

 
223,373

 
292,680

Common stock
 
600,046

 
758,390

 
600,046

 
595,626

Fixed Income
 
—

 
—

 
400,000

 
399,639

Total Current
 
$
823,419

 
$
1,112,440

 
$
2,227,909

 
$
2,283,772


As of November 30, 2013, the Company had total unrealized gains on its investments of $289,021. This amount was reduced by a deferred tax expense of $106,669, of which a deferred tax expense of $86,053 was recorded in the current fiscal year and $20,616 was recorded in prior fiscal years. None of the unrealized losses have been deemed to be other-than-temporary impairments.
Bank certificates of deposit are insured by the Federal Deposit Insurance Corporation for the full balance under the Temporary Liquidity Guarantee Program. The Company maintains accounts with several brokerage firms. The accounts contain cash and securities. Balances are insured up to $500,000 (with a limit of $100,000 for cash) by the Securities Investor Protection Corporation (SIPC).
The market value at November 30, 2013 was $1,112,440 as compared to $2,283,772 at November 30, 2012. The gross unrealized gains and (losses) were $289,021 and $0 for November 30, 2013, and $76,119 and $(20,256) for November 30, 2012, respectively. The cost and market values of the investments at November 30, 2013 were as follows:
Name of Issuer and Title of
Each Issue
 
Number of
Units
 
Cost of
Each Issue
 
Market
Value of
Each Issue
at Balance
Sheet Date
 
Amount at
Which Each
Portfolio of
Equity Security
Issue and Each
Other Security
Issue Carried in
Balance Sheet
Limited Partnerships:
 
 
 
 
 
 
 
 
Energy Transfer Partners
 
1,000

 
50,695

 
54,160

 
54,160

Enterprise Prods Partners
 
500

 
21,190

 
31,485

 
31,485

Kinder Morgan Energy
 
500

 
34,762

 
40,985

 
40,985

Magellan Midstream Partners
 
1,000

 
53,113

 
124,280

 
124,280

Plains All Amern Pipeline
 
1,000

 
63,613

 
103,140

 
103,140

 
 
 
 
223,373

 
354,050

 
354,050

Common Stock:
 
 
 
 
 
 
 
 
S&P 500 ETF Trust
 
4,190

 
600,046

 
758,390

 
758,390

 
 
 
 
600,046

 
758,390

 
758,390

 
 
 
 
 
 
 
 
 
TOTALS
 
 
 
823,419

 
1,112,440

 
1,112,440



During the years ended November 30, 2013, 2012 and 2011, available-for-sale securities were liquidated and proceeds amounting to $1,553,000, $4,430,892 and $3,516,000 were received, with resultant realized losses (gains) totaling $4,518, $(121,670) and $(815), respectively. Cost of available-for-sale securities includes unamortized premium or discount. The unrealized gains are accounted for under mark-to-market rules for Available-for-Sale securities. Please see Note 2 for further information.
The Company adopted ASC Topic 820, “Fair Value Measurements and Disclosures” as of December 1, 2007, which expands disclosures about investments that are measured and reported at fair market value. ASC Topic 820 established a fair value hierarchy that prioritizes the inputs to valuation techniques utilized to measure fair value into three broad levels as follows:
Level 1 – Quoted market prices in active markets for the identical asset or liability that the reporting entity has ability to access at measurement date.
Level 2 – Quoted market prices for identical or similar assets or liabilities in markets that are not active, and where fair value is determined through the use of models or other valuation methodologies.
Level 3 – Unobserved inputs for the asset or liability. Fair value is determined by the reporting entity’s own assumptions utilizing the best information available, and includes situations where there is little market activity for the investment.
 
 
November 30,
 
Quoted Market
Price in
Active Markets
 
Significant
Other
Observable
Inputs
Description
 
2013
 
(Level 1)
 
(Level 2)
Limited partnership
 
354,050

 
354,050

 
—

Common stock
 
758,390

 
758,390

 
—

Total
 
$
1,112,440

 
$
1,112,440

 
$
—



 
 
November 30,
 
Quoted Market
Price in
Active Markets
 
Significant
Other
Observable
Inputs
Description
 
2012
 
(Level 1)
 
(Level 2)
Corporate obligations
 
$
995,827

 
$
—

 
$
995,827

Limited partnership
 
292,680

 
292,680

 
—

Common stock
 
595,626

 
595,626

 
—

Fixed income
 
399,639

 
399,639

 
—

Total
 
$
2,283,772

 
$
1,287,945

 
$
995,827