What changed in this filing

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

2020-06-08 compared with 2020-03-06 · 46 added, 50 removed, 29 unchanged (77% of the section changed)

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest on borrowings under our bank credit

agreements are tied to prevailing domestic and foreign interest rates.

At January 31, 2020, we had no borrowings outstanding under

any of our credit facilities.

AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest on borrowings under our bank

credit agreements are tied to prevailing domestic and foreign interest rates.

At April 30, 2020, we had no borrowings outstanding

under any of our credit facilities.

Foreign Currency Exchange Risk

In the first three months

of fiscal 2020, we derived approximately 60% of our revenues from customers located outside of the Americas, where we invoiced

and received payments in several foreign currencies.

All of our computerized machine tools and computer control systems, as well

as certain proprietary service parts, are sourced by our U.S.-based engineering and manufacturing division and re-invoiced to our

foreign sales and service subsidiaries, primarily in their functional currencies.

Our products are sourced

from foreign suppliers or built to our specifications by either our wholly-owned subsidiaries in Taiwan, the U.S., Italy and China

or an affiliated contract manufacturer in Taiwan.

In the first six months of fiscal 2020,

we derived approximately 58% of our revenues from customers located outside of the Americas, where we invoiced and received payments

in several foreign currencies.

All of our computerized machine tools and computer control systems, as well as certain proprietary

service parts, are sourced by our U.S.-based engineering and manufacturing division and re-invoiced to our foreign sales and service

subsidiaries, primarily in their functional currencies.

Our products are sourced from foreign

suppliers or built to our specifications by either our wholly-owned subsidiaries in Taiwan, the U.S., Italy and China or

an affiliated contract manufacturer in Taiwan.

Our purchases are predominantly in foreign currencies and in some cases our arrangements

3 unchanged sentences

to the New Taiwan Dollar and the Euro.

We enter into foreign

currency forward exchange contracts from time to time to hedge the cash flow risk related to forecasted inter-company sales and

purchases denominated in, or based on, foreign currencies (primarily the Euro, Pound Sterling, and New Taiwan Dollar).

enter into foreign currency forward exchange contracts to protect against the effects of foreign currency fluctuations on receivables

and payables denominated in foreign currencies.

We do not speculate in the financial markets and, therefore, do not enter into

these contracts for trading purposes.

Forward contracts for

the sale or purchase of foreign currencies as of January 31, 2020, which are designated as cash flow hedges under FASB guidance

related to accounting for derivative instruments and hedging activities, were as follows (in thousands, except weighted average

forward rates):

Notional Amount

Contract Amount at

Forward Rates in

We enter into foreign currency forward

exchange contracts from time to time to hedge the cash flow risk related to forecasted inter-company sales and purchases denominated

in, or based on, foreign currencies (primarily the Euro, Pound Sterling, and New Taiwan Dollar).

We also enter into foreign currency

forward exchange contracts to protect against the effects of foreign currency fluctuations on receivables and payables denominated

in foreign currencies.

We do not speculate in the financial markets and, therefore, do not enter into these contracts for trading

Forward contracts for the sale or purchase

of foreign currencies as of April 30, 2020, which are designated as cash flow hedges under FASB guidance related to accounting

for derivative instruments and hedging activities, were as follows (in thousands, except weighted average forward rates):

Maturity Dates

Sale Contracts:

Feb 2020 - Jan 2021

May 2020 - Apr 2021

Pound Sterling

Feb 2020 - Jan 2021

May 2020 - Apr 2021

Purchase Contracts:

New Taiwan Dollar*

Feb 2020 - Jan 2021

May 2020 - Apr 2021

*New Taiwan Dollars per U.S.

Forward contracts for the sale or purchase

of foreign currencies as of January 31, 2020, which were entered into to protect against the effects of foreign currency fluctuations

of foreign currencies as of April 30, 2020, which were entered into to protect against the effects of foreign currency fluctuations

on receivables and payables denominated in foreign currencies and are not designated as hedges under FASB guidance, were as follows

2 unchanged sentences

Forward Rates in

Contract Date

Maturity Dates

Sale Contracts:

Feb 2020 - Jan 2021

May 2020 - Apr 2021

Pound Sterling

Feb 2020 –

May 2020 - Jun

South African Rand

1 unchanged sentence

New Taiwan Dollar

Feb 2020 - May 2020

May 2020 - Aug 2020

* New Taiwan Dollars per U.S.

1 unchanged sentence

exchange risk related to our investment in net assets in foreign countries.

To manage this risk, we have maintained a forward contract

with a notional amount of €3.0 million.

We designated this forward contract as a hedge of our net investment in Euro-denominated

We selected the forward method under FASB guidance related to the accounting for derivative instruments and hedging activities.

The forward method requires all changes in the fair value of the contract to be reported as a cumulative translation adjustment

in Accumulated other comprehensive loss, net of tax, in the same manner as the underlying hedged net assets.

This forward contract

matures in November 2020.

As of January 31, 2020, we had a realized gain of $947,000 and an unrealized gain of $10,000, net of

tax, recorded as cumulative translation adjustments in Accumulated other comprehensive loss related to the hedging of our net investment

in Euro-denominated assets.

Forward contracts for the sale or purchase of foreign currencies as of January 31, 2020, which are

designated as net investment hedges under this guidance were as follows (in thousands, except weighted average forward rates):

Contract Amount at

To manage this risk, we have maintained a forward

contract with a notional amount of €3.0 million.

We designated this forward contract as a hedge of our net investment in

Euro-denominated assets.

We selected the forward method under FASB guidance related to the accounting for derivative instruments

and hedging activities.

The forward method requires all changes in the fair value of the contract to be reported as a cumulative

translation adjustment in Accumulated other comprehensive loss, net of tax, in the same manner as the underlying hedged net assets.

This forward contract matures in November 2020.

As of April 30, 2020, we had a realized gain of $947,000 and an unrealized

gain of $75,000, net of tax, recorded as cumulative translation adjustments in Accumulated other comprehensive loss related to

the hedging of our net investment in Euro-denominated assets.

Forward contracts for the sale or purchase of foreign currencies

as of April 30, 2020, which are designated as net investment hedges under this guidance were as follows (in thousands, except

weighted average forward rates):

Forward Rates in

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 3. Quantitative and Qualitative Disclosures About Market Risk