BOWL AMERICA INC - FORM 10-Q - February 12, 2013

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EXCEL - IDEA: XBRL DOCUMENT - BOWL AMERICA INC	Financial_Report.xls
EX-32 - EXHIBIT 32 - BOWL AMERICA INC	ex32.htm
EX-20 - EXHIBIT 20 - BOWL AMERICA INC	ex20.htm
EX-31.1 - EXHIBIT 31.1 - BOWL AMERICA INC	ex31-1.htm
EX-31.2 - EXHIBIT 31.2 - BOWL AMERICA INC	ex31-2.htm

FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

FOR THE QUARTERLY PERIOD ENDED: DECEMBER 30, 2012

COMMISSION FILE NUMBER: 1-7829

BOWL AMERICA INCORPORATED

(Exact name of registrant as specified in its charter)

MARYLAND	54-0646173
(State of Incorporation)	(I.R.S.Employer Identification No)

6446 Edsall Road, Alexandria, Virginia 22312

(Address of principal executive offices)(Zip Code)

(703) 941-6300

(Registrant's telephone number including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the

Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was

required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No __

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes X No __

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a

smaller reporting company. See the definitions of “accelerated filer,” “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer __ Accelerated Filer __ Non-Accelerated Filer __ Smaller Reporting Company X

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act)

Yes __ No X

Indicate the number of shares outstanding of each of the issuer's

classes of common stock, as of the latest practicable date:

	Shares Outstanding at
	January 27, 2013
Class A Common Stock,
$.10 par value	3,683,009

Class B Common Stock,
$.10 par value	1,468,462

PART 1. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

BOWL AMERICA INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

	Thirteen Weeks Ended				Twenty-six Weeks Ended
	December 30,		January 1,		December 30,		January 1,
	2012		2012		2012		2012
Operating Revenues:
Bowling and other	$	4,368,238	$	4,503,640	$	8,042,718	$	8,401,703
Food, beverage and merchandise sales		1,836,735		1,926,499		3,349,499		3,524,037
		6,204,973		6,430,139		11,392,217		11,925,740

Operating Expenses:
Employee compensation and benefits		2,911,780		3,052,849		5,866,644		6,098,248
Cost of bowling and other services		1,570,084		1,713,475		3,195,785		3,545,326
Cost of food, beverage and merchandise sales	548,273			566,451		1,002,550		1,048,795
Depreciation and amortization		386,728		398,634		777,115		822,401
General and administrative		206,199		259,288		470,126		513,308
		5,623,064		5,990,697		11,312,220		12,028,078

Operating Income (loss)		581,909		439,442		79,997		(102,338	)
Interest and dividend income		119,065		145,595		250,284		264,032

Earnings before provision for income taxes		700,974		585,037		330,281		161,694
Provision for income taxes		245,300		204,770		115,600		56,600

Net Earnings	$	455,674	$	380,267	$	214,681	$	105,094

Earnings per share-basic & diluted	$	.09	$	.07	$	.04	$	.02

Weighted average shares outstanding		5,151,471		5,151,471		5,151,471		5,151,471

Dividends paid	$	4,275,723	$	824,236	$	5,099,957	$	1,648,471

Per share, dividends paid, Class A	$	.83	$	.16	$	.99	$	.32

Per share, dividends paid, Class B	$	.83	$	.16	$	.99	$	.32

The operating results for the thirteen (13) and twenty-six (26) week periods ended December 30, 2012 are not necessarily indicative of results to be expected for the year.

See notes to condensed consolidated financial statements.

BOWL AMERICA INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (CONTINUED)

(Unaudited)

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS

	Thirteen Weeks Ended					Twenty-six Weeks Ended
	December 30,			January 1,		December 30,			January 1,
	2012			2012		2012			2012

Net Earnings	$	455,674		$	380,267	$	214,681		$	105,094
Other comprehensive earnings- net of tax
Unrealized (loss) gain on available-for-sale securities net of tax (benefit) of ($209,501) and $79,288 for 13 weeks, and ($85,622) and ($71,207) for 26 weeks		(340,373	)		128,819		(139,108	)		(115,686	)

Comprehensive earnings (loss)	$	115,301		$	509,086	$	75,573		$	(10,592	)

The operating results for the thirteen (13) and twenty-six (26) week periods ended December 30, 2012 are not necessarily indicative of results to be expected for the year.

See notes to condensed consolidated financial statements.

BOWL AMERICA INCORPORATED AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited)

	As of
	December 30,		July 1,
	2012		2012
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	1,627,475	$	2,332,022
Short-term investments		948,519		3,863,721
Inventories		583,964		535,412
Prepaid expenses and other		511,630		613,891
Income taxes refundable		290,918		313,518
TOTAL CURRENT ASSETS		3,962,506		7,658,564
LAND, BUILDINGS & EQUIPMENT
Net of accumulated depreciation of $38,735,118 and $38,021,911		22,355,900		22,718,526
OTHER ASSETS:
Marketable securities		8,136,764		8,286,680
Cash surrender value-life insurance		619,624		619,624
Other		84,780		84,780
TOTAL OTHER ASSETS		8,841,168		8,991,084
TOTAL ASSETS	$	35,159,574	$	39,368,174

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$	522,160	$	722,380
Accrued expenses		755,352		1,004,221
Dividends payable		-		824,235
Other current liabilities		1,646,473		295,978
Current deferred income taxes		65,552		65,552
TOTAL CURRENT LIABILITIES		2,989,537		2,912,366
LONG-TERM DEFERRED COMPENSATION		44,217		44,217
NONCURRENT DEFERRED INCOME TAXES		2,640,815		2,726,437
TOTAL LIABILITIES		5,674,569		5,683,020

COMMITMENTS AND CONTINGENCIES (Note 3)

STOCKHOLDERS' EQUITY
Preferred stock, par value $10 a share: Authorized and unissued, 2,000,000 shares		-		-
Common stock, par value $.10 a share: Authorized, 10,000,000 shares
Class A issued and outstanding 3,683,009		368,301		368,301
Class B issued and outstanding 1,468,462		146,846		146,846
Additional paid-in capital		7,727,264		7,727,264
Accumulated other comprehensive earnings-Unrealized gain on available-for-sale securities, net of tax		2,399,710		2,538,818
Retained earnings		18,842,884		22,903,925
TOTAL STOCKHOLDERS' EQUITY		29,485,005		33,685,154

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	35,159,574	$	39,368,174

See notes to condensed consolidated financial statements.

BOWL AMERICA INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Twenty-six Weeks Ended
	December 30,			January 1,
	2012			2012
Cash Flows From Operating Activities
Net earnings	$	214,681		$	105,094
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		777,115			822,401
Changes in assets and liabilities
Increase in inventories		(48,552	)		(80,901	)
Decrease in prepaid & other		102,261			229,425
Decrease (increase) in income taxes refundable		22,600			(61,400	)
Decrease in other long-term assets		-			2,500
Decrease in accounts payable		(200,220	)		(94,451	)
Decrease in accrued expenses		(248,869	)		(467,139	)
Increase in other current liabilities		1,350,495			1,338,055
Net cash provided by operating activities		1,969,511			1,793,584

Cash Flows From Investing Activities
Expenditures for land, building and equip		(414,489	)		(1,298,545	)
Net sales & maturities of short-term Investments		2,915,202			1,632,795
Purchases of marketable securities		(74,814	)		(274,445	)
Net cash provided by Investing activities		2,425,899			59,805

Cash Flows From Financing Activities
Payment of cash dividends		(5,099,957	)		(1,648,471	)
Net cash used in financing activities		(5,099,957	)		(1,648,471	)

Net (Decrease) Increase in Cash and Equivalents		(704,547	)		204,918

Cash and Equivalents, Beginning of period		2,332,022			2,361,846

Cash and Equivalents, End of period	$	1,627,475		$	2,566,764


Supplemental Disclosures of Cash Flow Information
Cash Paid During the Period for:
Income taxes	$	93,000		$	118,000

See notes to condensed consolidated financial information.

BOWL AMERICA INCORPORATED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Thirteen and Twenty-six Weeks Ended

December 30, 2012

(Unaudited)

1. Basis for Presentation

The accompanying unaudited condensed consolidated financial statements of Bowl America Incorporated and subsidiaries (the "Company"), have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. The condensed consolidated balance sheet as of July 1, 2012 has been derived from the Company's audited financial statements. Certain information and note disclosures normally included in the annual financial statements, prepared in accordance with accounting principles generally accepted in the United States of America, have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information presented not misleading.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments and reclassifications (all of which are of a normal, recurring nature) that are necessary for the fair presentation of the Company’s financial position and results of operations for the periods presented. It is suggested that these condensed consolidated financial statements be read in conjunction with the consolidated financial statements and notes thereto included in the Company's annual report on Form 10-K for the year ended July 1, 2012.

2. Investments

The Company’s investments are categorized as available-for-sale. Short-term investments consist of certificates of deposits with maturities of generally three months to one year. Equity securities consist primarily of telecommunications stocks. Mutual funds consist of federal agency mortgage backed securities (Ginnie Mae). The fair value of the Company’s investments at December 30, 2012 and July 1, 2012 were as follows:

December 30, 2012 Description	Fair Value		Cost basis		Unrealized Gain
Short-term investments	$	948,519	$	948,519	$	-
Equity securities	$	4,608,647	$	888,998	$	3,719,649
Mutual funds	$	3,528,117	$	3,371,014	$	157,103

July 1, 2012 Description	Fair Value		Cost basis		Unrealized Gain
Short-term investments	$	3,863,721	$	3,863,721	$	-
Equity securities	$	4,788,498	$	888,998	$	3,899,500
Mutual funds	$	3,498,182	$	3,296,201	$	201,981

The fair values of the Company’s investments were determined as follows:

December 30, 2012 Description	Quoted Price for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)

Certificates of deposits	$	-	$	948,519	$	-
Equity securities		4,608,647		-		-
Mutual funds		3,528,117		-		-

Total	$	8,136,764	$	948,519	$	-

July 1, 2012 Description	Quoted Price for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)

Certificates of deposits	$	-	$	3,863,721	$	-
Equity securities		4,788,498		-		-
Mutual funds		3,498,182		-		-

Total	$	8,286,680	$	3,863,721	$	-

The stocks included in the equity securities portfolio as of December 30, 2012 were:

82,112	shares of AT&T
354	shares of Fairpoint Communications
939	shares of Supermedia
774	shares of NCR
774	shares of Teradata
11,865	shares of Vodafone
2,520	shares of Manulife
4,398	shares of CenturyLink
4,508	shares of Frontier Communications
475	shares of LSI
40,000	shares of Sprint
23,784	shares of Verizon
4,079	shares of Windstream

The Mutual fund included in the table above is Vanguard GNMA Admiral Shares #536 fund.

3. Commitments and Contingencies

The Company’s purchase commitments at December 30, 2012 are for materials, supplies, services and equipment as part of the normal course of business.

4. Employee benefit plans

The Company has two defined contribution plans with Company contributions determined by the Board of Directors. The Company has no defined benefit plan or other postretirement plan.

5. Subsequent Events

The Company has evaluated subsequent events through the time of filing these financial statements with the Securities and Exchange Commission on February 12, 2013, and has determined that no material subsequent events have occurred.

6. Reclassifications

Certain previous year amounts have been reclassified to conform with current year presentation.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements concerning our business, operations and financial performance and condition as well as our plans, objectives and expectations for our business operations and financial performance and condition that are subject to risks and uncertainties. All statements other than statements of historical fact included in this Quarterly Report on Form 10-Q are forward-looking statements. These forward-looking statements are based on current expectations, estimates, forecasts and projections about our business and the industry in which we operate and our management’s beliefs and assumptions. These statements are not guarantees of future performance or development and involve risks, uncertainties and other factors that are in some cases beyond our control. The forward-looking statements included in this Quarterly Report on Form 10-Q are made as the date hereof. We are under no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

LIQUIDITY AND CAPITAL RESOURCES

The Company views a strong financial position as a major benefit to shareholders and emphasizes payment of dividends as part of its financial plan. A portion of earnings has consistently been invested to create a reserve to protect the Company in downturns in business, to capitalize on opportunities for expansion and modernization and to provide a secure source of income. For these reasons, the Company prefers a conservative approach to investing rather than taking greater risk for possible rapid growth. The Company balances market volatility by using both fixed income and equity investments in managing its reserve funds. Any equity security is subject to price fluctuation, however, the stocks held by the Company have relatively low volatility. The Company has long been invested in a Government National Mortgage Association (“Ginnie Mae” or “GNMA”) fund and domestically domiciled stocks with the perceived potential of appreciation, primarily telecommunications stocks. The Company considers that this diversity also provides a measure of safety of principal.

The Company purchased 5,000 shares of Verizon for $178,200 in the quarter ended January 1, 2012. The remainder of common stocks in our portfolio have come from spin-offs, mergers and acquisitions of AT&T and United Telecommunications (now Sprint) purchased in 1979 and 1984 and from one insurance company acquired at no cost when that company demutualized. While not all stocks in the portfolio are domestic American companies any longer, since the original purchases at an approximate cost of $630,000, we have received approximately $962,000 from mergers and sales, and over $3,200,000 in dividends, the majority of which are tax favored in the form of exclusion from federal taxable income. The fair value of the securities on December 30, 2012 was approximately $4,609,000.

The Company’s original investment in the Vanguard GNMA bond fund began in 1988 with purchases of shares in the fund totaling approximately $1,400,000. Except for a one time sale of approximately $666,000 in 1991, all earnings have been reinvested. The fund is carried at fair value on the last day of the reporting period. At December 30, 2012, the value was approximately $3,528,000.

Short-term investments consisting mainly of Certificates of Deposits, cash and cash equivalents totaled $2,576,000 at the end of the fiscal second quarter of 2013 compared to $6,196,000 at the end of fiscal 2012. As noted below, short-term investments were used, along with cash on hand, to fund the dividends paid to shareholders during the quarter ended December 30, 2012.

The Company’s position in all the above investments is a source of expansion capital. Potential volatility in the trading prices of the marketable securities held by the Company could impact the Company’s opportunities for expansion. The Board of Directors reviews the portfolio weekly and any use of this reserve at its quarterly meetings.

In the six-month period ended December 30, 2012, the Company expended approximately $414,000 for the purchase of building, entertainment and restaurant equipment. The Company has made no application for third party funding as cash and cash flows are sufficient to finance all contemplated purchases and to meet short-term purchase commitments and operating lease commitments.

The six-month changes in the categories of Accounts Payable and Accrued Expenses are primarily due to seasonal timing of payments including cash contribution to a benefit plan.

Current liabilities generally increase during the first three quarters of the fiscal year as leagues deposit prize fund monies with the Company throughout the league season. These funds are returned to the leagues at the end of the bowling season, generally in the fourth quarter. At December 30, 2012, league deposits of approximately $1,432,000 were included in the current liabilities category.

Cash flow provided by operating activities in the twenty-six weeks ended December 30, 2012 was $1,969,000 which, along with cash on hand and short-term investments, was sufficient to meet day-to-day cash needs and pay dividends. In December 2012, after reviewing cash and other reserves, the economic climate, and possible changes to federal tax rates on dividends, the Board of Directors declared a special dividend of $.50 per share to be paid December 28, 2012. Additionally, the Company declared a regular quarterly dividend of $.165 per share, usually paid in February, to be paid December 28, 2012. Total cash dividends of approximately $4,276,000, or $.83 per share, were paid to shareholders during the quarter ended December 30, 2012, and the six months total was approximately $5,100,000 or $.99 per share. The economic climate is part of the consideration at the Directors’ quarterly reviews of future estimates of cash flows. The Board of Directors decides the amount and timing of any dividend at its quarterly meeting based on its appraisal of the state of the business and estimate of future opportunities.

OVERVIEW

The Company is in the entertainment business which, by its nature, has ups and downs based on consumer tastes and whims. Generally, promotional and open play bowling which depends on the public’s discretionary budget dollars and their choices, accounts for more than half of our business. An unstable economy can lead many to participate in entertainment that is close to home and relatively inexpensive. Bowling has those advantages. However the longer the economy remains unstable, the less willing people are to spend on other than necessities. Weather is also a factor, especially for casual bowlers. While rainy weather prompts people to look for indoor activities, heavy snow storms can keep customers from reaching the centers. Postponed league games are made up later in the season, but lost open play income is never recovered. Current economic conditions continue to create challenging times but our response will be helped by having the resources to be able to promote the sport.

RESULTS OF OPERATIONS

The following table sets forth the items in our consolidated summary of operations for the fiscal year-to-date periods ended December 30, 2012, and January 1, 2012, and the dollar and percentage changes therein.

	Twenty-six weeks ended
	December 30, 2012 and January 1, 2012
	Dollars in thousands
	12/30/2012		01/01/2012			Change			% Change
Operating Revenues:
Bowling and other	$	8,043	$	8,402		$	(359	)		(4.3	)%
Food, beverage & merchandise sales		3,349		3,524			(175	)		(5.0	)
		11,392		11,926			(534	)		(4.5	)
Operating Expenses:
Compensation & benefits		5,867		6,098			(231	)		(3.8	)
Cost of bowling & other		3,196		3,545			(349	)		(9.8	)
Cost of food, beverage & merch sales		1,002		1,049			(47	)		.(4.5	)
Depreciation & amortization		777		823			(46	)		(5.6	)
General & administrative		470		513			(43	)		(8.4	)
		11,312		12,028			(716	)		(6.0	)

Operating Income (loss)		80		(102	)		182			178.4

Interest & dividend income		250		264			(14	)		(5.3	)

Earnings before taxes		330		162			168			103.7
Income taxes		115		57			58			101.8

Net Earnings	$	215	$	105		$	110			107.8

Net earnings were $455,674 or $.09 per share for the thirteen-week period ended December 30, 2012, and $380,267 or $.07 per share for the thirteen weeks ended January 1, 2012. For the current year and prior year twenty-six week periods net earnings were $214,681 or $.04 per share and $105,094, or $.02 per share, respectively. The prior year second quarter included New Year’s Eve and Day business, however the holiday will be reflected in the third quarter of fiscal 2013. Management believes that the continuing uncertainty of an economic recovery and the consequences of federal tax and spending provisions are influencing the public’s view of discretionary spending. The operating results for fiscal 2013 periods included in this report are not necessarily indicative of results to be expected for the year.

Operating Revenues

Total operating revenues decreased $225,000 to $6,205,000 in the most recent quarter compared to a decrease of $50,000 to $6,430,000 in the three-month period ended January 1, 2012. For the current fiscal six-month period operating revenues were down $534,000 versus a decrease of $204,000 in the comparable six-month period a year ago. Bowling and other revenue declined $135,000 in the quarter and $359,000 year-to-date for the periods ended December 30, 2012. Prior year comparable three and six month period revenues showed decreases of $50,000 and $159,000, respectively.

Food, beverage and merchandise sales were down $90,000 or 3.5% in the current year quarter and down $175,000 or 5% in the six-month period. Cost of sales was down 3.2% and 4.5%, respectively, in the three month and six month periods ended December 30, 2012.

Operating Expenses

Operating expenses were down $368,000 or 6% and $716,000 or 6% in the current three and six-month periods, respectively, versus decreases of $229,000 or 4% and $307,000 or 3% each in the three and six month periods, respectively, last year. Employee compensation and benefits for the three and six month periods were down $141,000 and $231,000, respectively, or 4.6% and 3.8% in the periods ended December 30, 2012, as the Company continued to make scheduling adjustments in response to customer traffic. In addition, group health insurance costs decreased as a result of lower premiums, fewer participants and the end of costs incurred in establishing health savings accounts. In the prior year comparable periods operating expenses were down $65,000 in the three month period and down $111,000 in the six-month period, or 2% each period respectively. Included in this category of expense are contributions to our two benefit plans, both of which are defined contribution plans. There is no additional obligation beyond the current year contribution.

Cost of bowling and other services decreased $349,000 or 10% and $172,000 or 5% in the six-month periods ended December 30, 2012 and January 1, 2012, respectively. In the twenty-six weeks ended December 30, 2012, maintenance and repair costs were down $12,000 or 6% primarily the result of fewer building repairs. In the prior year twenty-six week period costs were down $85,000 or 17%. Advertising costs during the current year twenty-six week period were down $24,000 versus a decrease of $66,000 in the prior year comparable period, or 14% in each period due in part to the change in media used. For the six month periods ended December 30, 2012 and January 1, 2012, respectively, utility costs were down $28,000 or 8% and down $32,000 or 4%. Lower fuel costs and our efforts in energy management are primarily responsible for the decreases. Supplies and services expenses were down 9% in the current year six-month period and down 3% in the six-month period in the prior year. Changes in the timing of purchases and lower costs of some supplies are the primary reasons for the decreases.

Insurance expense excluding health insurance decreased 11% in the current year-to-date period versus an increase of 7% in last year’s comparable period when the Company made policy and coverage changes.

Depreciation and amortization expense was down 6% in the current six-month period and 5% in the prior year six-month period.

As a result of the above, the current six-month period of fiscal 2013 showed operating income of $80,000 compared to the prior year six-month period that showed an operating loss of $102,000.

Interest and Dividend Income

Interest and dividend income decreased $14,000 in the fiscal 2013 six-month period and decreased $67,000 in the comparable 2012 year-to-date period, respectively. The current year decrease is a result of lower investment balances, lower interest rates and lower capital gains from the Ginnie Mae fund.

CRITICAL ACCOUNTING POLICIES

Management has identified accounting for marketable investment securities as a critical accounting policy due to the significance of the amounts included in the Company’s balance sheet under the captions of Short-term investments and Marketable securities. The Company exercises judgment in determining the classification of its investment securities as available-for-sale and in determining their fair value. The Company records these investments at their fair value with the unrealized gain or loss recorded in accumulated other comprehensive earnings, a component of stockholders’ equity, net of deferred taxes. Additionally, from time to time the Company must assess whether write-downs are necessary for other than temporary declines in value.

Management has identified accounting for the impairment of long-lived assets as a critical accounting policy due to the significance of the amounts included in the Company’s balance sheet under the caption of Land, Buildings and Equipment. The Company reviews long-lived assets whenever events or changes indicate that the carrying amount of an asset may not be recoverable. In making such evaluations, the Company compares the expected future cash flows to the carrying amount of the assets. An impairment loss equal to the difference between the assets’ fair value and carrying value is recognized when the estimated future cash flows are less than the carrying amount.

ITEM 4. CONTROLS AND PROCEDURES.

The Company’s Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are effective based on their evaluation of such controls and procedures as of December 30, 2012. There was no change in the Company’s internal control over financial reporting identified in connection with the evaluation that occurred during the quarter ended December 30, 2012, that materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

BOWL AMERICA INCORPORATED AND SUBSIDIARIES

S.E.C. FORM 10-Q

PART II - OTHER INFORMATION

Item 6. Exhibits.

20	Press release issued February 12, 2013 (furnished herewith)

31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act filed herewith

31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act filed herewith

32	Written Statement of the Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. 1350 filed herewith

101	Interactive data files for the thirteen and twenty six weeks ended December 30, 2012 in eXtensible Business Reporting Language

Pursuant to the requirements of the Securities Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Bowl America Incorporated
	(Registrant)

Date: February 12, 2013	By: /s/ Leslie H. Goldberg
	Leslie H. Goldberg, President



Date: February 12, 2013	By: /s/ Cheryl A. Dragoo
	Cheryl A. Dragoo, Controller

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