If compensation costs for the stock options granted had been determined based on the fair market value method of SFAS 123, the Company’s pro forma net income and earnings per share would have been as follows: The fair value of each option grant was estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly sub- jective assumptions, including the expected share price volatility.  Income Taxes: The Company accounts for income taxes pursuant to the asset and liability method. Under that method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in the tax rate is recognized in income or expense in the period that the change is effective.  Foreign Currency Translation: Assets and liabilities of the Company’s foreign subsidiaries are translated using the exchange rates in effect at the balance sheet date, while income and expenses are translated using average rates. Translation adjustments are reported as a component of shareholders’ equity in accumulated other comprehensive loss. Recently Issued Accounting Standards: The Financial Accounting Standards Board has issued Statement of Financial Accounting Standards No. 148,  Accounting for Stock-Based Compensation — Transition and Disclosure (SFAS 148). SFAS 148 amends Statement of Financial Accounting Standards No. 123,  Accounting for Stock-Based Compensation  (SFAS 123) , to provide alternative methods of transition when a company voluntarily changes to the fair value-based method of  recognizing expense in the income statement for stock-based employee compensation, including stock options granted to employees. As allowed by SFAS 123, the Company has adopted the disclosure-only provisions of the standard and does not recognize compensation expense for stock options granted to employees. Year Ended April 30, 2003 2001 Average expected term (years) 5 5 Risk-free interest rate 4.08% 5.75% Dividend yield 2.50% 2.60% Volatility 27.70% 27.00% Fair value of options granted $8.06 $6.49 Year Ended April 30, (Dollars in thousands, except per share data) 2003 2002 2001 Net income, as reported $96,342 $30,851 $27,206 Total stock-based compensation expense determined under  fair value-based methods for all awards, net of tax benefit  (2,581) (1,061) (1,188) Net income, as adjusted $93,761 $29,790 $26,018 Earnings per common share: Net income, as reported $ 2.04  $ 1.33 $ 1.13 Total stock-based compensation expense determined under  fair value-based methods for all awards, net of tax benefit (0.06) (0.04) (0.05) Net income, as adjusted $ 1.98  $ 1.29 $ 1.08 Net income, as reported – assuming dilution $ 2.02  $  1.31 $ 1.12 Total stock-based compensation expense determined under  fair value-based methods for all awards, net of tax benefit –  assuming dilution (0.06) (0.04) (0.05) Net income, as adjusted – assuming dilution $ 1.96  $ 1.27 $ 1.07 26