Item 7. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Fiscal 2006

Results of Operations

Net income for the twelve months ended April 30, 2006 of $23,439,000 or $2.35 per share was $2,121,000 or 10% above net income of $21,318,000 or $2.14 per share in fiscal year 2005. Net income of $5,712,000 for the fourth quarter ended April 30, 2006 was 16% higher than net income of $4,922,000 for the last quarter of fiscal year 2005. Operating income of $35,180,000 for the twelve months ended April 30, 2006 was $8,096,000 above operating income of $27,084,000 last fiscal year, a 30% increase. Operating income of $9,510,000 for the three months ended April 30, 2006 was 11% higher than operating income of $8,534,000 for the comparable period of the last fiscal year. The Company’s income from securities transactions of $3,869,000 was 53% below last year’s for the twelve months ended April 30, 2006. Income from securities transactions of $298,000 for the last quarter of fiscal 2006 was 22% above income from securities transactions of $245,000 for the three months ended April 30, 2005. Shareholders’ equity of $61,935,000 at April 30, 2006 was 40% higher than shareholders’ equity of $44,143,000 at April 30, 2005.

Subscription revenues of $47,703,000 for the twelve months ended April 30, 2006 were 5% below subscription revenues of $50,172,000 for the prior fiscal year. Electronic publications revenues of $10,947,000 were up $17,000 compared to $10,930,000 for the prior fiscal year. Within electronic publications revenues are revenues generated by institutional subscribers and retail subscribers. Institutional revenues increased $761,000 or 27%, while revenues from retail subscribers were down $744,000 or 9%. Print subscription revenues of $36,756,000 were down $2,486,000 or 6% compared to $39,242,000 for the last fiscal year. At fiscal year end 2006, unearned revenue was $37,500,000 compared to $40,022,000 in the previous year. The decrease is a result of lower orders received in fiscal year 2006 due to less frequent direct marketing and advertising campaigns than the previous year. Licensing fees for the twelve months ended April 30, 2006 of $5,016,000 were up $2,475,000 or 97% compared to $2,541,000 for the fiscal 2005.

Investment management fees and service revenues of $32,467,000 for the twelve months ended April 30, 2006 were up $702,000, or 2% above the prior fiscal year’s revenues of $31,765,000. Investment management fees and service revenues of $8,307,000 for the fourth quarter ended April 30, 2006 were 8% above the prior fiscal year’s revenues of $7,677,000. Beginning November 2004, VLS suspended its business of executing trades for any of the Value Line Funds, from which it had earned net commission revenues. The decline in brokerage revenues was mostly offset by higher investment advisory fees that resulted primarily from a 21% increase in the net assets of the Value Line Funds, which included fee waivers for certain of the Value Line Funds at April 30, 2006. Total mutual funds net assets as of April 30, 2006 were approximately $3.8 billion.

Operating expenses for the twelve months ended April 30, 2006 of $50,006,000 were 13% below expenses of $57,394,000 for the previous fiscal year. Total advertising and promotional expenses of $13,671,000 for the twelve months ended April 30, 2006 were 33% below the prior year’s expenses of $20,455,000. The decrease in advertising expenses resulted primarily from the reduction in the frequency of marketing campaigns in fiscal 2006 for the Company’s investment periodicals and media advertising for brand recognition. Salaries and employee benefit expenses of $19,025,000 for the twelve months ended April 30, 2006 were down 2% compared to expenses of $19,445,000 for the prior fiscal year. Production and distribution expenses for the twelve months ended April 30, 2006 of $7,073,000 were 18% below expenses of $8,589,000 for fiscal 2005. The decline in expenses for the twelve months of fiscal 2006 was primarily due to lower paper, printing and distribution costs that resulted in part from a decrease in circulation of the print products. Office and administrative expenses for the first twelve months of fiscal 2006 of $10,237,000 were 15% higher than the prior fiscal year’s expenses of $8,905,000. The increase in administrative expenses was primarily due to an increase in professional fees and the additional costs associated with outsourcing certain of the mutual fund administration functions.

-16-

For the twelve months ended April 30, 2006, the Company’s income from securities transactions of $3,869,000 was 53% below securities transactions income of $8,278,000 last fiscal year. Income from securities transactions for the twelve months ended April 30, 2006 included dividend and interest income of $1,844,000. Realized capital gains, net of unrealized capital losses, during the twelve months of fiscal 2006 were $2,212,000, of which $2,355,000 represented distributions from the Value Line Mutual Funds and $75,000 from an installment sale of an investment in a privately held company. The income from securities transactions for the twelve months of fiscal 2006 compares to dividend and interest income of $602,000 and capital gains of $7,676,000 from sales of securities included in the Company’s trading and available for sale portfolios included in the twelve months ended April 30, 2005. The prior fiscal year included capital gains that resulted from partial sales of the Company’s equity securities in preparation for payment of a special dividend of $17.50 per common share during the first quarter of fiscal 2005 and redeployment of the remaining proceeds in fixed income government obligations. Capital gains for the twelve months of fiscal 2005 also included $433,000 from the initial proceeds from the installment sale of an investment in a privately held company.

Liquidity and Capital Resources

The Company had working capital as of April 30, 2006 of $63,823,000. Cash and short-term securities as of April 30, 2006 totaled $81,246,000.

The Company’s cash flow from operations of $18,919,000 for the twelve months ended April 30, 2006 was 48% lower than fiscal 2005’s cash flow of $36,590,000. The decrease in cash flow from operations was primarily due to the liquidation of the Company’s trading securities portfolio in fiscal year 2005. Net cash inflows of $422,000 from investing activities during the twelve months of fiscal 2006 compared to net cash outflows of $24,071,000 last year, which primarily resulted from purchases of fixed income securities in fiscal 2005. Cash outflows from financing activities of $9,981,000 during fiscal year 2006 represent the payment of the Company’s quarterly dividend of $0.25 per share for each quarter. Cash outflows from financing activities for fiscal year 2005 of $184,656,000 reflect the Company’s quarterly dividends of $.25 per share for each quarter as well as a special $17.50 dividend paid to all shareholders on May 19, 2004.

From time to time, AB&Co., the Company’s controlling shareholder, has purchased additional shares of Value Line, Inc. in the market when and as AB&Co. has determined it to be appropriate. As stated several times in the past, the public is reminded that AB&Co. may make additional purchases from time to time in the future.

Management believes that the Company’s cash and other liquid asset resources used in its business together with the future cash flows from operations will be sufficient to finance current and forecasted operations. Management anticipates no borrowing for fiscal year 2007.

-17-

Fiscal 2005

Operating Results

Net income for the twelve months ended April 30, 2005 of $21,318,000 or $2.14 per share was 5% above net income of $20,350,000 or $2.04 per share in fiscal 2004. Operating income of $27,084,000 for the twelve months ended April 30, 2005 was 9% above operating income of $24,739,000 for the same period of the last fiscal year. Operating income of $8,534,000 for the three months ended April 30, 2005 was 17% higher than operating income of $7,300,000 for the comparable period of the last fiscal year. Retained Earnings of $30,798,000 at April 30, 2005 were 58% higher than Retained Earnings of $19,459,000 at April 30, 2004.

Subscription revenues of $52,713,000 for the twelve months ended April 30, 2005 were level with subscription revenues for the same period of the prior fiscal year. Revenues from all electronic publications were up 9% over the previous year while licensing fees were up 123% for the twelve months ended April 30, 2005. Revenues from all print products were down 5% compared to the last fiscal year’s level. Investment management fees and service revenues of $31,765,000 for the twelve months ended April 30, 2005 were 3% below the prior fiscal year’s revenues of $32,773,000, primarily because beginning November 2004, VLS suspended its business of effecting trades for any of the Value Line ~~funds,~~Funds, from which it had earned net commission revenues.

Operating expenses for the twelve months ended April 30, 2005 of $57,394,000 were 5% below the last fiscal year’s expenses of $60,531,000. Total advertising and promotional expenses of $20,455,000 were 6% below the prior year’s expenses of $21,821,000. The decrease in advertising expenses resulted primarily from the postponement of direct mail expenses until fiscal 2006. Salaries and employee benefit expenses of $19,445,000 were 6% below expenses of $20,764,000 recorded in the prior fiscal year as a result of staff reductions in the mutual fund product and asset management divisions. Production and distribution costs for the twelve months ended April 30, 2005 of $8,589,000 were 8% below expenses of $9,300,000 at April 30, 2004. The decline in expenses was primarily due to lower paper, printing and distribution costs that resulted in part from a decrease in circulation toof the print and electronic versions of our products. Office and administrative expenses of $8,905,000 were 3% higher than the prior fiscal year’s expenses of $8,646,000. The increase in administrative expenses was primarily due to an increase in professional fees including expenses to settle an action in the New York Supreme Court with a small mutual fund company relating to a proposed transaction and higher rent expenses resulting from scheduled lease escalations. The increases in administrative expenses were offset by lower depreciation of fixed assets and lower software licensing and hardware maintenance fees.

The Company’s income from securities transactions, net, of $8,278,000 for the twelve months ended April 30, 2005 was slightly above securities transactions income of $8,266,000 for the same period of the last fiscal year. Income from securities transactions, net, for the twelve months ended April 30, 2005 included dividend and interest income of $602,000 and capital gains of $7,676,000 from sales of equity securities from the Company’s short-term trading and

available for sale portfolios, which compares to dividend and interest income of $4,259,000 and capital gains of $4,017,000 from sales of securities from the Company’s short-term trading and available for sale portfolios for the same period of the last fiscal year. The lower dividend and interest income during fiscal 2005 was a result of sales of the Company’s fixed income securities during the latter part of fiscal 2004 in preparation for payment on May 19, 2004 of a special dividend of $17.50 per share paid to all ~~common stockholders of record as of May 7, 2004.~~shareholders. Income from securities transactions, net, for the twelve months ended April 30, 2005 also ~~includes~~included $433,000 from the initial proceeds from the installment sale of ~~shares received under the terms of~~an investment in a ~~contract with a vendor.~~privately held company.

-18-

Liquidity and Capital Resources

The Company had working capital as of April 30, 2005 of ~~$45,401,000 including cash~~$45,401,000. Cash and short-term securities ~~at market value~~as of April 30, 2005 totaled $82,245,000.

The Company’s cash flow from operations of $36,590,000 for the twelve months ended April 30, 2005 was 371% higher than fiscal 2004’s cash flow of $7,771,000. The rise in cash flow from operations was primarily due to the liquidation of the Company’s trading securities portfolio and higher net income. Net cash outflows of $24,071,000 from investing activities during the twelve months of fiscal 2005 primarily resulted from purchases of fixed income securities. Net cash inflows of $170,102,000 during fiscal 2004 resulted primarily from sales of fixed income securities in preparation for payment on May 19, 2004 of a special dividend in the amount of $174,678,000.

~~Fiscal 2004~~

~~Operating Results~~

Net income for the twelve months ended April 30, 2004 of $20,350,000 or $2.04 per share was 2% above net income of $19,987,000 or $2.00 per share for the same period in fiscal 2003. Operating income of $24,739,000 for the twelve months ended April 30, 2004 was 3% above operating income of $24,095,000 for the same period of the last fiscal year. Operating income of $7,300,000 for the three months ended April 30, 2004 was 7% higher than operating income of $6,843,000 for the comparable period of the last fiscal year. Income from securities transactions for the twelve months of fiscal 2004 was 25% above income from securities transactions for the same period of fiscal 2003. Revenues of $85,270,000 for the twelve months ended April 30, 2004 were 3% higher than revenues of $82,245,000 in the prior fiscal year. Revenues of $22,045,000 for the fourth quarter of fiscal 2004 were 11% above revenues of $20,201,000 for the three months ended April 30, 2003.

During fiscal 2004, the Company’s stock outperformed the major market indices. Value Line, Inc.’s. stock was up 34% for the twelve months ended April 30, 2004. In April 2004, the Board of Directors of the Company declared a distribution from its Retained Earnings in the form of a special dividend of $17.50 per share or $174,678,000 to all shareholders of record as of May 7, 2004. The purpose of the dividend was to return to all shareholders, in the form of cash, a significant portion of the earnings of the Company from its successful operations over the past number of years, at a time when shareholders can enjoy the present favorable tax rates on dividends. Despite this significant distribution, Value Line remains exceptionally strong financially with $35,298,000 of Shareholders’ Equity as of April 30, 2004 after declaration of the special dividend.

Subscription revenues of $52,497,000 for the twelve months ended April 30, 2004 were approximately equal to those for the same period of the prior fiscal year. Although total revenues from all print products for the twelve months ended April 30, 2004 were down 4% since the last fiscal year, revenues from all electronic publications were up over 12% in fiscal 2004. Subscription revenues of $13,728,000 for the fourth quarter of fiscal 2004 were 7% above revenues of $12,874,000 for the three months ended April 30, 2004. While total revenues from all print products for the three months ended April 30, 2004 were level with the revenues for the fourth quarter of fiscal 2003, revenues from all electronic publications were 11% above revenues for the comparable quarter of the last fiscal year. Investment management fees and services revenues of $32,773,000 for the twelve months ended April 30, 2004 were 10% above the prior fiscal year’s revenues of $29,776,000. Investment management fees and services revenues of $8,715,000 for the three months ended April 30, 2004 were 19% above the revenues of $7,327,000 recorded in the fourth quarter of fiscal 2003.

Operating expenses for the twelve months ended April 30, 2004 of $60,531,000 were 4% above the last year’s expenses of $58,150,000. Total advertising and promotional expenses of $21,821,000 were 7% above the prior year’s expenses of $20,418,000 primarily due to additional costs associated with marketing two of the Company’s equity mutual funds, increases in media advertising, higher fund supermarket fees related to sales of the Value Line mutual funds shares, and increased postage rates for direct mail. Successful direct mail campaigns resulted in an increase in subscription activity since April 2003 with total new full term subscription orders rising 11% from the level during the twelve months of the prior fiscal year. Salaries and employee benefit expenses of $20,764,000 were 4% above expenses of $19,938,000 recorded in the prior fiscal year. Production and distribution expenses for the twelve months ended April 30, 2004 of $9,300,000 were 3% below expenses of $9,576,000 for the twelve months ended April 30, 2003. The decline in expenses was primarily due to lower paper, printing and distribution costs that resulted from a migration in circulation from print to electronic versions of our products and management’s decision to discontinue issuing print copies of the Reference Library to trial subscribers of ~~The Value~~~~Line Investment Survey~~ ~~and~~ ~~The Value~~~~Line Investment Survey Small and Mid-Cap Stock Edition~~. These decreases in production and distribution expenses were offset by higher commissions fee expenses in connection with the Company’s brokerage operation. Office and administrative expenses of $8,646,000 were 5% above the last year’s expenses of $8,218,000. The net increase in administrative expenses was primarily due to higher rent expenses resulting from scheduled lease increases, higher bank collection fees associated with an increase in the Company’s publishing credit card business, and increases in professional fees.

The Company’s securities portfolios produced a gain of $8,266,000 for the twelve months ended April 30, 2004 versus a gain of $6,626,000 for the same period of the last fiscal year. The Company’s trading portfolio produced a gain of $3,008,000 during the twelve months ended April 30, 2004 versus losses of $940,000 during the same period of the last fiscal year. Income from securities transactions for the twelve months ended

April 30, 2004 also included dividend and interest income of $4,259,000 and capital gains of $1,087,000 from sales of securities from the Company’s long-term portfolio of equity and fixed income securities. This compares to dividend and interest income of $4,361,000 and capital gains of $3,211,000 from sales of securities from the Company’s long-term portfolio for the same period of the last fiscal year.

~~Liquidity and Capital Resources~~

The Company had working capital as of April 30, 2004 of $36,699,000 including liquid assets consisting of cash and securities of $244,446,000, used in its business. Working capital has been reduced by the declaration of a $17.50 special dividend payable May 19, 2004 to all shareholders of record on May 7, 2004.

The Company’s cash flow from operations of $7,771,000 for the twelve months ended April 30, 2004 was $8,681,000 lower than fiscal 2003’s cash flow of $16,452,000. The decrease in cash flow from operations was primarily the result of additional investments in the Company’s short-term equity trading portfolio. The decrease was partially offset by a rise in cash flow from other operating activity primarily an 11% increase in total new full term subscription orders, an increase of 9% in the Company’s investment management business, and containment of expenses. Net cash inflows of $170,102,000 from investing activities during the twelve months of fiscal 2004 resulted primarily from sales of fixed income securities in preparation for payment on May 19, 2004 of a special dividend in the amount of $174,678,000. Net cash outflows of $113,702,000 for investing activities for the twelve months of fiscal 2003 were due largely to the Company’s decision last fiscal year to re-deploy its cash and equity holdings into Government debt obligations with higher effective yields.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This report contains statements (including certain projections and business trends) accompanied by such phrases as “believe”, “estimate”, “expect”, “anticipate”, “will”, “intend” and other similar or negative expressions, that are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected as a result of certain risks and uncertainties, including but not limited to the following:

demand for and market acceptance of new and existing products;

renewals of subscriptions for the Company’s products;

~~adaptation of the Company’s products to new technologies;~~

fluctuations in the Company’s assets under management due to broadly based changes in the values of equity and debt securities, redemptions by investors and other factors;

competitive product and pricing pressures;

the impact of government regulation on the Company’s business and the uncertainties of litigation and regulatory initiatives and inquiries; and

other risks and uncertainties, including but not limited to ~~those detailed~~the risks described in Item 1A, "Risk Factors", and other risks and uncertainties from time to ~~time in our SEC filings.~~time.

16-19-

Any forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements.

Contractual Obligations

Below is a summary of certain contractual obligations (in thousands):

Contractual Obligations	Total		Less Than 1 Year		1-3 years		3-5 years		More Than 5 Years
Operating Lease Obligations	$	2,999	$	1,690	$	1,309		—		—
Purchase Obligations		—		—		—		—		—
Other Long-term Obligations reflected on Balance Sheet	$	37,726	$	28,224	$	9,502		—		—
TOTAL	$	40,725	$	29,914	$	10,811		—		—

Contractual
Obligations

Total

Less
than 1
Year

1-3 years

3-5 years

After 5
Years

Operating
Lease
Obligations

$
4,745

$
1,788
$ 2,957 — —
Purchase
Obligations
— — — — —
Other
Long-term
Obligations
reflected
on Balance
Sheet

$
40,092

$
29,748

$
10,344

—

—

TOTAL $ 44,837 $ 31,536 $ 13,301 — —

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Market Risk Disclosures

~~Value Line, Inc.’s~~The Company’s Consolidated Balance Sheet includes a substantial amount of assets and liabilities whose fair values are subject to market risks. ~~Value Line’s~~The Company’s significant market risks are primarily associated with interest rates and equity prices. The following sections address the significant market risks associated with ~~Value Line’s~~the Company’s business activities.

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Interest Rate Risk

~~Value Line’s~~The Company’s management prefers to invest in highly liquid debt securities with extremely low credit risk. Value Line’s strategy is to acquire securities that are attractively priced in relation to the perceived credit risk. Management recognizes and accepts that losses may occur. To limit the price fluctuation in these securities from interest rate changes, ~~Value Line’s~~the Company’s management invests primarily in short-term obligations maturing in 1 to 5 years.

The fair values of ~~Value Line’s~~the Company’s fixed maturity investments will fluctuate in response to changes in market interest rates. Increases and decreases in prevailing interest rates generally translate into decreases and increases in fair values of those instruments. Additionally, fair values of interest rate sensitive instruments may be affected by prepayment options, relative values of alternative investments, and other general market conditions.

The following table summarizes the estimated effects of hypothetical increases and decreases in interest rates on assets that are subject to interest rate risk. It is assumed that the changes occur immediately and uniformly to each category of instrument containing interest rate risks. The hypothetical changes in market interest rates do not reflect what could be deemed best or worst case scenarios. Variations in market interest rates could produce significant changes in the timing of repayments due to prepayment options available. For these reasons, actual results might differ from those reflected in the table. Dollars are in thousands.

Estimated Fair Value after
Hypothetical Change in Interest Rates

(bp = basis points)
Fair 50bp 50bp 100bp 100bp
Fixed Income Securities Value increase decrease increase decrease

As of April 30, 2005
Investments in securities with fixed maturities $ 39,065 $
38,927
$ 39,253 $ 38,911 $ 39,326

As of April 30, 2004
Investments in securities with fixed maturities $ 1 $ 1 $ 1 $ 1 $ 1

During the last quarter of fiscal year 2004, the Company sold virtually all of its long-term holdings of fixed maturity investments and transferred the proceeds to cash in preparation for payment of a special $17.50 per share dividend, declared on April 23, 2004. The sale greatly

	Estimated Fair Value after
	Hypothetical Change in Interest Rates

	(bp = basis points)

			6 mo.		6 mo.		1 yr.		1 yr.
	Fair		50bp		50bp		100bp		100bp
Fixed Income Securities	Value		increase		decrease		increase		decrease

As of April 30, 2006
Investments in securities with fixed maturities	$	41,585	$	41,549	$	41,801	$	41,514	$	41,821

As of April 30, 2005
Investments in securities with fixed maturities	$	39,065	$	38,927	$	39,253	$	38,911	$	39,326

~~reduced the Company’s exposure to risks associated with interest rate changes.~~ Management regularly monitors the maturity structure of the Company’s investments in fixed maturity U.S. government debt obligations in order to maintain an acceptable price risk associated with changes in interest rates.

Equity Price Risk

The carrying values of investments subject to equity price risks are based on quoted market prices or management’s estimates of fair value as of the balance sheet dates. Market prices are subject to fluctuation and, consequently, the amount realized in the subsequent sale of an investment may significantly differ from the reported market value. Fluctuation in the market price of a security may result from perceived changes in the underlying economic characteristics of the issuer, the relative price of alternative investments and general market conditions. Furthermore, amounts realized in the sale of a particular security may be affected by the relative quantity of the security being sold.

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Value Line invests a significant level of its assets in equity securities, primarily the Value Line family of equity mutual funds. Each mutual fund invests in a variety of equity positions of various companies thereby diversifying Value Line’s risk. ~~The Company’s objectives include maintenance of a greater weighting in large and mid capitalization companies in its equity portfolio to moderate price risk.~~ Value Line has also utilized derivative financial instruments in the past to minimize market price risk, although no such derivative financial instruments were utilized during fiscal ~~2005~~2006 and ~~2004.~~2005.

The table below summarizes Value Line’s equity price risks as of April 30, ~~2005~~2006 and ~~2004~~2005 and shows the effects of a hypothetical 30% increase and a 30% decrease in market prices as of those dates. The selected hypothetical changes do not reflect what could be considered the best or worst case scenarios. Dollars are in thousands.

														Estimated
														Fair Value after		Hypothetical Percentage
			Hypothetical		Estimated Fair Value after Hypothetical		Hypothetical Percentage Increase (Decrease) in					Hypothetical		Hypothetical		Increase (Decrease) in
Equity Securities	Fair Value		Price Change		Change in Prices		Shareholders’Equity			Fair Value		Price Change		Change in Prices		Shareholders’ Equity
As of April 30, 2006										$	46,644		30% increase	$	60,637		14.69	%
													30% decrease	$	32,651		(14.69	)%

As of April 30, 2005	$	37,209		30% increase	$	48,372		25.3	%	$	37,209		30% increase	$	48,372		16.44	%
				30% decrease	$	26,046		(25.3	)%				30% decrease	$	26,046		(16.44	)%

As of April 30, 2004	$	46,356		30% increase	$	60,259		39.4	%
				30% decrease	$	32,447		(39.4	)%

*Less than one percent

~~(1)~~*

~~Excludes 8,631,032 shares (86.47%~~Less than one percent

Jean Bernhard Buttner, Chairman of the ~~outstanding shares) owned by Arnold Bernhard & Co., Inc. Jean Bernhard Buttner~~Board, President and Chief Executive Officer of the Company, owns all of the outstanding voting stock of Arnold Bernhard & Co., Inc. Substantially all of the non-voting stock of Arnold Bernhard & Co., Inc. is held by members of the Buttner family.

²	Excludes 8,631,032 shares (86.47% of the outstanding shares) owned by Arnold Bernhard & Co., Inc.

24-27-

Securities Authorized for Issuance under Equity Compensation Plans

As of the date of this Annual Report on Form 10-K, there were no securities of the Company authorized for issuance under equity compensation plans.

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

Arnold Bernhard & Co., Inc. (“AB&Co.”) utilizes the services of officers and employees of the Company to the extent necessary to conduct its business. The Company and ~~Arnold Bernhard & Co.~~AB&Co., Inc. allocate costs for office space, equipment and supplies and support staff pursuant to a servicing and ~~reimbursement arrangement.~~reimbursement. During the years ended April 30, 2006, 2005, ~~2004,~~ and ~~2003,~~2004, the Company was reimbursed $918,000, $689,000 ~~$489,000~~ and ~~$527,000,~~$489,000, respectively, for payments it made on behalf of and services it provided to AB~~&Co..~~&Co. At April 30, ~~2005~~2006 and ~~2004,~~2005, Receivable from affiliates included a Receivable from AB&Co. of ~~$107,000~~$154,000 and ~~$70,000,~~$107,000, respectively. For the years ended April 30, 2006, 2005, ~~2004,~~ and ~~2003,~~2004, the Company made payments to AB&Co. for federal income tax amounting to $11,895,000, $12,115,000 and $10,650,000, ~~and $9,500,000,~~ respectively. At April 30, 2006 accrued taxes payable included a federal tax liability owed to AB&Co. in the amount of $449,000. At April 30, 2005 accrued taxes payable included a federal tax liability owed to the Company from AB&Co. in the amount of $145,000. ~~At April 30, 2004 accrued taxes payable included a federal tax liability owed to Parent in the amount of $390,000.~~ In addition, a tax-sharing arrangement allocates the tax liabilities of the two companies between them. The Company pays to ~~Arnold Bernhard & Co.~~AB&Co., Inc. an amount equal to the Company's liability as if it filed separate tax returns.

The Company acts as investment adviser and manager for fourteen open-ended investment companies, the Value Line ~~Family of~~ Funds. The Company earns investment management fees based upon the average daily net asset values of the respective funds. ~~Effective July 1, 2000, the Company received~~VLS receives service and distribution fees under rule 12b-1 of the Investment Company Act of 1940 from ~~twelve of~~ the ~~fourteen~~ mutual ~~funds for which Value Line is the adviser. Effective September 18, 2002, the Company began receiving service and distribution fees under rule 12b-1 from the remaining two~~ funds for which Value Line, Inc. is the adviser. ~~The Company also~~For certain periods prior to December 2004, VLS earned brokerage commission income on securities transactions executed by ~~Value Line Securities, Inc.~~VLS on behalf of the funds that were cleared on a fully disclosed basis through non-affiliated brokers, who received a portion of the gross commission. ~~Pending a review of effecting trades for the Value Line Funds,~~ VLS in November 2004 suspended ~~effectuation~~execution of trades through VLS for any of the Value Line Funds. For the years ended April 30, 2006, 2005, ~~2004,~~ and ~~2003,~~2004, investment management fees, service and distribution fees and brokerage commission income amounted to $31,278,000, $30,206,000 and $30,851,000, ~~and $28,022,000, respectively.~~respectively, after fee waivers. These amounts include service and distribution fees of $9,915,000, $9,609,000 ~~$9,638,000,~~ and ~~$7,968,000,~~$9,638,000, respectively. The related receivables from the funds for management advisory fees and service and distribution fees included in Receivable from affiliates were ~~$2,406,000~~$2,751,000 and ~~$2,448,000~~$2,406,000 at April 30, 2006 and 2005, ~~and 2004,~~ respectively.

Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Audit and Non-Audit Fees

For the fiscal ~~year~~years ended April 30, ~~2005~~2006 and ~~2004,~~2005, fees for services provided by Horowitz & Ullmann, P.C. were as follows:

	2006		2005
Audit fees	$	134,695	$	129,450
Audit-related fees	$	24,190	$	51,790
Tax fees	$	76,960	$	89,430
All other fees	$	0	$	0

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2005 2004
Audit fees $ 129,450 $ 125,625
Audit-related fees $ 51,790 $ 31,360
Tax fees $ 89,430 $ 93,840
All other fees $ 0 $ 0

Audit Committee Pre-Approval Policies and Procedures

The Audit Committee of the Company's Board of Directors approves all services provided by ~~the~~ Horowitz & Ullmann, P.C. prior to the provision of those services and has not adopted any pre-approval policies and procedures.

Part IV

Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

~~(a)~~

(a)	1. Financial Statements

See Part II Item 8.

Schedules

Schedule XIII - Other Investments. (Reg. S-X, Article 5)

All other Schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.

~~(b) Exhibits~~

(b)

Exhibits


3.1	Articles of Incorporation of the Company, as amended through April 17, 1983, are incorporated by reference to the Registration Statement - Form S-1 of Value Line, Inc. Part II, Item 16.(a) 3.1 filed with the Securities and Exchange Commission on April 7, 1983.
	3.2	Certificate of Amendment of Certificate of Incorporation dated October 24, 1989 is incorporated by reference to the Annual Report on Form 10K for the year ended April 30, 1990.
	10.8	Form of tax allocation arrangement between the Company and AB&Co. incorporated by reference to the Registration Statement - Form S-1 of Value Line, Inc. Part II, Item 16.(a) 10.8 filed with the Securities and Exchange Commission on April 7, 1983.

10.9

Form of Servicing and Reimbursement Agreement between the Company and AB&Co., dated as of November 1, 1982 incorporated by reference to the Registration Statement - Form S-1 of Value Line, Inc. Part II, Item 16.(a) 10.9 filed with the Securities and Exchange Commission on April 7, 1983.

	10.10	Value Line, Inc. Profit Sharing and Savings Plan as amended and restated effective May 1, 1989, including amendments through April 30, 1995, incorporated by reference to the Annual Report on Form 10-K for the year ended April 30, 1996.
	10.13	Lease for the Company's premises at 220 East 42nd Street, New York, N.Y. incorporated by reference to the Annual Report on Form 10-K for the year ended April 30, 1994.
	10.14	Lease amendments dated September 14, 2000 and January 19, 2006, for the Company’s premises located at 220 East 42^nd Street, New York, NY.
	14	Code of Business Conduct and Code of Ethics incorporated by reference to Exhibit 14 to the Form 8-K filed on December 1, 2004.
	21	Subsidiaries of the Registrant.
	31	Rules 13a-14(a) and 15d-14(a) Certifications.
	32	Section 1350 Certifications.

~~Value Line, Inc.~~

~~Consolidated Balance Sheets~~

		April 30,			April 30,
		2006			2005
Assets
Current Assets:
Cash and cash equivalents (including short term
investments of $14,885 and $5,654, respectively)		$	15,331		$	5,971
Trading securities			22,314			---
Securities available for sale			65,915			76,274
Accounts receivable, net of allowance for doubtful
accounts of $72 and $52, respectively			3,037			3,096
Receivable from affiliates			2,917			2,557
Prepaid expenses and other current assets			1,617			1,468
Deferred income taxes			88			32
Total current assets			111,219			89,398

Long term assets:
Property and equipment, net			5,406			5,984
Capitalized software and other intangible assets, net			2,589			3,483
Total long term assets			7,995			9,467
Total assets		$	119,214		$	98,865

Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable and accrued liabilities		$	6,186		$	4,331
Accrued salaries			1,495			1,247
Dividends payable			2,495			2,495
Accrued taxes payable			560			---
Unearned revenue			28,224			29,748
Deferred income taxes			8,436			6,176
Total current liabilities			47,396			43,997

Long term liabilities:	��
Unearned revenue			9,502			10,344
Deferred charges			381			381
Total long term liabilities			9,883			10,725

Shareholders' Equity:
Common stock, $.10 par value; authorized 30,000,000
shares; issued 10,000,000 shares			1,000			1,000
Additional paid-in capital			991			991
Retained earnings			44,256			30,798
Treasury stock, at cost (18,400 shares on 4/30/06
and 4/30/05)			(354	)		(354	)
Accumulated other comprehensive income, net of tax			16,042			11,708
Total shareholders' equity			61,935			44,143
Total liabilities and shareholders' equity		$	119,214		$	98,865

~~(in thousands, except share amounts)~~

Apr. 30, 2005

Apr. 30, 2004

(restated * )

Current Assets:

Cash and cash equivalents (including short term investments of $5,654 and $177,682, respectively) $ 5,971 $ 178,108
Trading securities — 19,981
Securities available for sale 76,274 46,357
Receivable from clearing brokers — 5,356
Accounts receivable, net of allowance for doubtful accounts of $52, and $40, respectively
3,096 1,842
Receivable from affiliates 2,557 2,920
Prepaid expenses and other current assets 1,468 1,911
Deferred income taxes 32 104
Total current assets 89,398 256,579

Long term assets:
Property and equipment, net 5,984 6,545
Capitalized software and other intangible assets, net 3,483 3,800
Total long term assets 9,467 10,345
Total assets $ 98,865 $ 266,924

Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable, accrued expenses and other liabilities $ 4,331 $ 3,619
Accrued salaries 1,247 1,576
Dividends payable 2,495 177,172
Accrued taxes payable — 422
Unearned revenue 29,748 29,407
Deferred income taxes 6,176 7,684
Total current liabilities 43,997 219,880

Long term liabilities:
Unearned revenue 10,344 11,464
Deferred charges 381 282
Total long term liabilities 10,725 11,746

Shareholders' Equity:
Common stock, $.10 par value; authorized 30,000,000 shares; issued 10,000,000 shares 1,000 1,000
Additional paid-in capital 991 991
Retained earnings 30,798 19,459
Treasury stock, at cost (18,400 shares on 4/30/05 & 4/30/04) (354 ) (354 )
Accumulated other comprehensive income, net of tax 11,708 14,202
Total shareholders' equity 44,143 35,298
Total liabilities and shareholders' equity $ 98,865 $ 266,924

* See independent auditor's report and accompanying notes to the consolidated financial statements.

31-33-

Value Line, Inc.

Consolidated Condensed Statements of Income ~~and Retained Earnings~~

(in thousands, except per share amounts)

Years ended April 30,
2005 2004 2003
Revenues:
Investment periodicals and related publications $ 52,713 $ 52,497 $ 52,469
Investment management fees & services 31,765 32,773 29,600
Total revenues 84,478 85,270 82,069
Expenses:
Advertising and promotion 20,455 21,821 20,418
Salaries and employee benefits 19,445 20,764 19,938
Production and distribution 8,589 9,300 9,400
Office and administration 8,905 8,646 8,218
Total expenses 57,394 60,531 57,974

Income from operations 27,084 24,739 24,095
Income from securities transactions, net 8,278 8,266 6,626
Income before income taxes 35,362 33,005 30,721
Provision for income taxes 14,044 12,655 10,734
Net income $ 21,318 $ 20,350 $ 19,987

Retained earnings, at beginning of year 19,459 183,768 173,760
Dividends declared (9,979 ) (184,659 ) (9,979 )
Retained earnings, at end of year $ 30,798 $ 19,459 $ 183,768
Earnings per share, basic and fully diluted $ 2.14 $ 2.04 $ 2.00
Weighted average number of common shares 9,981,600 9,981,600 9,981,600


	Years ended April 30,
	2006		2005		2004

Revenues:
Investment periodicals and
related publications	$	47,703	$	50,172	$	51,360
Licensing fees		5,016		2,541		1,137
Investment management fees & svcs		32,467		31,765		32,773
Total revenues		85,186		84,478		85,270

Expenses:
Advertising and promotion		13,671		20,455		21,821
Salaries and employee benefits		19,025		19,445		20,764
Production and distribution		7,073		8,589		9,300
Office and administration		10,237		8,905		8,646
Total expenses		50,006		57,394		60,531

Income from operations		35,180		27,084		24,739
Income from securities transactions, net		3,869		8,278		8,266

Income before income taxes		39,049		35,362		33,005
Provision for income taxes		15,610		14,044		12,655
Net income	$	23,439	$	21,318	$	20,350

Earnings per share, basic & fully diluted	$	2.35	$	2.14	$	2.04

Weighted average number of common shares		9,981,600		9,981,600		9,981,600

See independent auditor's report and accompanying notes to the consolidated financial statements.

32-34-

~~Value Line, Inc.~~

~~Consolidated Statements of Cash Flows~~

Value Line, Inc.
Consolidated Condensed Statements of Cash Flows
((in thousands)

	Years ended April 30,									Years ended April 30,
	2005			2004			2003			2006			2005			2004
Cash flows from operating activities:
Net income	$	21,318		$	20,350		$	19,987		$	23,439		$	21,318		$	20,350

Adjustments to reconcile net income to net cash provided by operating activities:
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization		2,506			2,726			3,274			2,275			2,506			2,726
Gains on sales of trading securities and
securities available for sale		(8,802	)		(3,075	)		(2,242	)		(2,430	)		(8,802	)		(3,075	)
Unrealized (gains)/losses on trading securities		1,128			(942	)		(75	)
Unrealized losses/(gains) on trading securities											217			1,128			(942	)
Loss on disposal of fixed assets											139			—			—
Deferred income taxes		(371	)		193			(1,690	)		(204	)		(371	)		146

Changes in assets and liabilities:
Proceeds from sales of trading securities		43,385			41,549			4,227			—			43,385			41,549
Purchases of trading securities		(22,024	)		(55,406	)		(4,591	)		(4,364	)		(22,024	)		(55,406	)
(Decrease)/increase in unearned revenue		(779	)		2,292			(2,060	)		(2,366	)		(779	)		2,292
Increase/(decrease) in deferred charges		15			(344	)		73
(Decrease)/increase in accounts payable and accrued expenses		796			1,043			(552	)
(Decrease)/increase in accrued salaries		(329	)		186			(469	)
(Decrease)/increase in accrued taxes payable		(294	)		(191	)		486
Decrease/(increase) in prepaid expenses and other current assets		595			(667	)		(40	)
(Increase)/decrease in accounts receivable		(917	)		667			(33	)
Decrease/(increase) in receivable from affiliates		363			(610	)		157
(Decrease)/increase in deferred charges											(84	)		15			(344	)
Increase in accounts payable and accrued expenses											1,939			796			1,043
Increase/(decrease) in accrued salaries											248			(329	)		186
Increase/(decrease) in accrued taxes payable											560			(294	)		(144	)
(Increase)/decrease in prepaid expenses and other
current assets											(149	)		595			(667	)
Decrease/(increase) in accounts receivable											59			(917	)		667
(Increase)/decrease in receivable from affiliates											(360	)		363			(610	)
Total adjustments		15,272			(12,579	)		(3,535	)		(4,520	)		15,272			(12,579	)
Net cash provided by operations		36,590			7,771			16,452

Net cash provided by operating activities											18,919			36,590			7,771

Cash flows from investing activities:
Proceeds from sales of equity securities		12,671			5,788			39,598			2,430			12,671			5,788
Purchases of equity securities		(1,039	)		(1,425	)		(6,894	)
Purchase of equity securities											(2,467	)		(1,039	)		(1,425	)
Proceeds from sales of fixed income securities		9,019			229,127			57,471			9,650			9,019			229,127
Purchases of fixed income securities		(43,092	)		(61,210	)		(202,040	)		(8,249	)		(43,092	)		(61,210	)
Acquisition of property and equipment		(194	)		(271	)		(229	)		(218	)		(194	)		(271	)
Expenditures for capitalized software		(1,436	)		(1,907	)		(1,608	)		(724	)		(1,436	)		(1,907	)
Net cash (used in)/provided by investing activities		(24,071	)		170,102			(113,702	)
Net cash provided by/(used in) investing activities											422			(24,071	)		170,102

Cash flows from financing activities:
Proceeds from sales of treasury stock		—			—			45
Dividends paid		(184,656	)		(9,982	)		(9,979	)		(9,981	)		(184,656	)		(9,982	)

Net cash used in financing activities		(184,656	)		(9,982	)		(9,934	)		(9,981	)		(184,656	)		(9,982	)
Net (decrease)/increase in cash and cash equivalents		(172,137	)		167,891			(107,184	)

Net increase/(decrease) in cash and cash equivalents											9,360			(172,137	)		167,891
Cash and cash equivalents at beginning of year		178,108			10,217			117,401			5,971			178,108			10,217
Cash and cash equivalents at end of period	$	5,971		$	178,108		$	10,217
Cash and cash equivalents at end of year										$	15,331		$	5,971		$	178,108

See independent auditor's report and accompanying notes to the consolidated financial statements.

33-35-

VALUE LINE, INC.

CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN ~~STOCKHOLDERS'~~SHAREHOLDERS' EQUITY

FOR ~~THE~~ THREE YEARS ENDED APRIL 30, 2006, 2005 & 2004 ~~AND 2003~~

(in thousands, except share amounts)

Number
of common
shares

Par value
of common
shares

Additional
paid-in
capital

Treasury
Stock

Comprehensive
income

Retained
earnings

Accumulated
other
comprehensive
income
Total

Balance at April 30, 2002 9,980,125 $ 1,000 $ 975 ($383 ) $ 173,760 $ 20,653 $ 196,005

Comprehensive income
Net income $ 19,987 19,987 19,987
Other comprehensive income, net of tax:

Change in unrealized gains on securities
(10,680 ) (10,680 ) (10,680 )
Comprehensive income $ 9,307
Exercise of stock options 1,475 16 29 45
Dividends declared (9,979 ) (9,979 )
Balance at April 30, 2003 9,981,600 $ 1,000 $ 991 ($354 ) $ 183,768 $ 9,973 $ 195,378

Comprehensive income
Net income $ 20,350 20,350 20,350
Other comprehensive income, net of tax:
Change in unrealized gains on securities
4,229 4,229 4,229
Comprehensive income $ 24,579
Dividends declared (184,659 ) (184,659 )
Balance at April 30, 2004 9,981,600 $ 1,000 $ 991 ($354 ) $ 19,459 $ 14,202 $ 35,298

Comprehensive income
Net income $ 21,318 21,318 21,318
Other comprehensive income, net of tax:

Change in unrealized gains on securities
(2,494 ) (2,494 ) (2,494 )
Comprehensive income $ 18,824
Dividends declared (9,979 ) (9,979 )
Balance at April 30, 2005 9,981,600 $ 1,000 $ 991 ($354 ) $ 30,798 $ 11,708 $ 44,143


	Common stock															Accumulated
	Number		Par		Additional											Other
	of		Value		paid-in		Treasury			Comprehensive			Retained			Comprehensive
	shares		Amount		capital		Stock			income			earnings			income			Total

Balance at April 30, 2003		9,981,600	$	1,000	$	991	$	(354	)				$	183,768		$	9,973		$	195,378

Comprehensive income
Net income										$	20,350			20,350						20,350
Other comprehensive income,
net of tax:
Change in unrealized
gains on securities											4,229						4,229			4,229
Comprehensive income										$	24,579

Dividends declared														(184,659	)					(184,659	)
Balance at April 30, 2004		9,981,600	$	1,000	$	991	$	(354	)				$	19,459		$	14,202		$	35,298

Comprehensive income
Net income										$	21,318			21,318						21,318
Other comprehensive income,
net of tax:
Change in unrealized
gains on securities,
net of taxes											(2,494	)					(2,494	)		(2,494	)
Comprehensive income										$	18,824

Dividends declared														(9,979	)					(9,979	)
Balance at April 30, 2005		9,981,600	$	1,000	$	991	$	(354	)				$	30,798		$	11,708		$	44,143

Comprehensive income
Net income										$	23,439			23,439						23,439
Other comprehensive income,
net of tax:
Change in unrealized
gains on securities,
net of taxes											4,334						4,334			4,334
Comprehensive income										$	27,773

Dividends declared														(9,981	)					(9,981	)

Balance at April 30, 2006		9,981,600	$	1,000	$	991	$	(354	)				$	44,256		$	16,042		$	61,935

See independent auditor's report and accompanying notes to the consolidated financial statements.

34-36-

Note 1-Organization and Summary of Significant Accounting Policies:

Value Line, Inc. (the "Company") is incorporated in New York ~~State and carries on the~~State. Through its subsidiary, Value Line Publishing, Inc. ("VLP") it publishes investment periodicals and related ~~publications and~~publications. Value Line, Inc. performs investment management ~~activities formerly performed by~~services. Arnold Bernhard & Co., Inc. (the "Parent") ~~which~~ owns approximately 86% of the issued and outstanding common stock of the Company.

Principles of consolidation: The consolidated financial statements include the accounts of the Company and all of its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Revenue recognition: Subscription revenues are recognized ratably over the terms of the subscriptions. Accordingly, the amount of subscription fees to be earned by servicing subscriptions after the date of the balance sheet is shown as unearned ~~revenue (see note 17).~~

revenue.

Investment management fees (except 12b-1 fees) and brokerage commission income are recorded as the related services are performed (see note 3). Service and distribution fees under Rule 12b-1 are earned every month based on the average net assets of the respective mutual fund.

Valuation of Securities:

The Company's securities classified as available for sale consist of shares of the Value Line Mutual Funds ("Value Line Funds") and government debt securities accounted for in accordance with Statement of Financial Accounting Standards No.115, "Accounting for Certain Investments in Debt and Equity Securities"~~.The~~. The securities are valued at market with unrealized gains and losses on these securities reported, net of applicable taxes, as a separate component of Shareholders' Equity. Realized gains and losses on sales of the securities available for sale are recorded in earnings on trade date and are determined on the identified cost method.

The Company classifies its securities available for sale as current assets. It does so to properly reflect its liquidity and to recognize the fact that it has assets available for sale to fully satisfy its current liabilities should the need ~~arise (see note 17).~~

arise. Trading securities held by the Company and subsidiaries are valued at market with unrealized gains and losses included in earnings.

Market valuation of securities listed on a securities exchange and over-the-counter securities traded on the NASDAQ ~~national market~~Global Market is based on the closing sales prices on the last business day of each month. In the absence of closing sales prices for such securities, and for other securities traded in the over-the-counter market, the security is valued at the midpoint between the latest available and representative asked and bid prices.

Valuation of open-ended mutual fund shares ~~are~~is based upon the daily net asset values of the shares as calculated by such funds.

The market value of the Company's fixed maturity government debt obligations are ~~valued~~determined utilizing quoted prices at the end of each day provided by an outside pricing service.

Advertising expenses: The Company expenses advertising costs as incurred.

Reclassification: Certain items in the prior year financial statements have been reclassified to conform to the current year presentation.

~~Value Line, Inc.~~

~~Notes to Consolidated Financial Statements~~

Income Taxes:

The Company computes its income tax provision in accordance with the provisions of Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes". Deferred tax liabilities and assets are recognized for the expected future tax consequences of events that have been reflected in the Consolidated Financial Statements. Deferred tax liabilities and assets are determined based on the differences between the book values and the tax bases of particular assets and liabilities, using tax rates currently in effect for the years in which the differences are expected to reverse.

Earnings per share: Earnings per share are based on the weighted average number of shares of common stock and common stock equivalents outstanding during each year.

Cash and Cash Equivalents: For purposes of the Consolidated Statements of Cash Flows, the Company considers all cash held at banks and short term liquid investments with an original maturity of less than three months to be cash and cash equivalents. As of April 30, ~~2005~~2006 and ~~2004,~~2005, cash equivalents included ~~$5,546,000~~$14,746,000 and ~~$122,319,000,~~$5,546,000, respectively, invested in the Value Line money market funds.

-37-

Value Line, Inc.

Notes to Consolidated Financial Statements

Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

Note 2-Supplementary Cash Flow Information:

Cash payments for income taxes were $15,156,000, $14,666,000, ~~$12,755,000,~~ and ~~$11,480,000~~$12,755,000 in fiscal 2006, 2005, ~~2004,~~ and ~~2003,~~2004, respectively. Interest payments of $11,000, $7,000, ~~$18,000,~~ and ~~$49,000~~$18,000 were made in fiscal 2006, 2005, and 2004, ~~and 2003,~~ respectively.

Note 3-Related Party Transactions:

The Company acts as investment adviser and manager for fourteen open-ended investment companies, the Value Line ~~Family of Funds (see Note 4).~~Funds. The Company earns investment management fees based upon the average daily net asset values of the respective ~~funds. Effective July 1, 2000, the Company received~~Value Line Funds. The fourteen Value Line Funds have adopted service and distribution ~~fees~~plans under rule 12b-1 of the Investment Company Act of ~~1940 from twelve of the fourteen mutual funds for which~~1940. During certain periods prior to December 2004, Value Line ~~is the adviser. Effective September 18, 2002, the Company began receiving service and distribution fees under rule 12b-1 from the remaining two funds, for which Value Line,~~Securities, Inc. ~~is the adviser. The Company also~~, ("VLS") earned brokerage commission income on securities transactions executed by ~~Value Line Securities, Inc.~~VLS on behalf of the funds that cleared on a fully disclosed basis through non-affiliated brokers, who received a portion of the gross commission. ~~Pending a review of effecting trades for the Value Line Funds,~~ VLS in November 2004 suspended ~~effectuation of~~executing trades through VLS for any of the Value Line Funds.

For the twelve months ended April 30, 2006 investment management fees and 12b-1 service and distribution fees amounted to $31,378,000, which included fee waivers for certain of the Value Line Funds. For the years ended April 30, 2005, ~~2004,~~ and ~~2003,~~2004, investment management fees, 12b-1 service and distribution fees and brokerage commission income amounted to $30,206,000, ~~$30,851,000,~~ and ~~$28,022,000,~~$30,851,000, respectively. These amounts include service and distribution fees of $9,915,000, $9,609,000, and $9,638,000, respectively. There was no brokerage commission income in fiscal year 2006. In fiscal years 2005 and ~~$7,968,000,~~2004 these amounts included brokerage commission income of $1,378,000 and $2,736,000, respectively. The related receivables from the funds for management advisory fees and service and distribution fees included in Receivable from affiliates were ~~$2,406,000,~~$2,751,000, and ~~$2,448,000~~$2,406,000 at April 30, 2006 and 2005, ~~and 2004,~~ respectively.

~~Value Line, Inc.~~

~~Notes to Consolidated Financial Statements~~

For the years ended April 30, 2006, 2005, ~~2004,~~ and ~~2003,~~2004, the Company was reimbursed $918,000, $689,000 ~~$489,000~~ and ~~$527,000,~~$489,000, respectively, for payments it made on behalf of and services it provided to the Parent. At April 30, ~~2005~~2006 and ~~2004,~~2005, Receivable from affiliates included a Receivable from the Parent of ~~$107,000~~$154,000 and ~~$70,000,~~$107,000, respectively. For the years ended April 30, 2006, 2005, ~~2004,~~ and ~~2003,~~2004, the Company made payments to the Parent for federal income tax amounting to $11,895,000, $12,115,000 and $10,650,000, ~~and $9,500,000,~~ respectively. At April 30, 2006 accrued taxes payable included a federal tax liability owed to the Parent in the amount of $449,000. At April 30, 2005 accrued taxes payable included a federal tax liability owed to the Company from the Parent in the amount of $145,000. ~~At April 30, 2004 accrued taxes payable included a federal tax liability owed to Parent in the amount of $390,000.~~ These data are in accordance with the tax sharing arrangement described in Note 6.

Note 4-Investments:

Trading Securities:

Trading securities held by the Company at April 30, 2006 had an aggregate cost of $22,402,000 and a market value of $22,314,000. There were no trading securities held at April 30, 2005. ~~Securities held by the Company at~~There were no realized trading gains or losses during fiscal year 2006. The proceeds from sales of trading securities during fiscal years ended April 30, 2005 and 2004, ~~had an aggregate cost of $18,854,000~~were $43,385,000 and ~~a market value of $19,981,000.~~

~~Net~~$41,549,000, respectively, and the related net realized trading gains amounted to $2,502,000 ~~during the year ended April 30, 2005. Net realized trading gains amounted to~~and $2,084,000, ~~during the year ended April 30, 2004. Net realized trading losses amounted to $969,000 during fiscal 2003.~~

respectively. The net changes in trading securities for the period ended April 30, ~~2005~~2006 was ~~a loss of $1,128,000.~~

$22,402,000. The net changes in unrealized gains or losses for the periods ended April 30, 2006, 2005, and 2004, of $88,000 loss, $1,128,000 loss, and ~~2003 of~~ $942,000 ~~and $75,000,~~gain, respectively, were included in the Consolidated Statement of Income.

-38-

Value Line, Inc.

Notes to Consolidated Financial Statements

Securities Available for Sale:

Equity Securities:

The aggregate cost of the equity securities classified as available for sale, which ~~are invested~~consist of investments in the Value Line ~~mutual funds,~~Funds, was $21,635,000 and the market value was $46,644,000 at April 30, 2006. The aggregate cost of the equity securities classified as available for sale was $19,169,000 and the market value was $37,209,000 at April 30, 2005. ~~The aggregate cost of the securities at April 30, 2004 was $24,502,000 and the market value was $46,353,000.~~ The total gains for equity securities with net gains included in Accumulated Other Comprehensive Income on the Consolidated Balance Sheet are ~~$18,157,000~~$25,009,000 and ~~$21,850,000,~~$18,157,000, net of deferred taxes of ~~$6,355,000~~$8,803,000 and ~~$7,648,000,~~$6,355,000, as of April 30, 2006 and 2005, ~~and 2004,~~ respectively. There were no losses on equity securities included in Accumulated Other Comprehensive Income for fiscal year 2006. Losses on equity securities included in Accumulated Other Comprehensive Income for the fiscal years ended April 30, 2005 was ~~$117,000.~~

~~There were no losses on equity securities included in Accumulated Other Comprehensive Income for fiscal year 2004.~~$117,000, net of deferred tax benefit of $42,000. The ~~decrease~~increase in gross unrealized gains on these securities of ~~$3,810,000~~$6,969,000 and the ~~increase~~decrease of ~~$8,066,000,~~$3,810,000, net of deferred taxes of ~~$1,344,000~~$2,453,000 and ~~$2,823,000,~~$1,344,000, were included in Shareholders' Equity at April 30, 2006 and 2005, ~~and 2004,~~ respectively.

Realized capital gains from the sales of securities classified as available for sale were $2,430,000, $6,177,000 ~~$1,441,000~~ and ~~$2,609,000~~$1,441,000 of which $2,355,000, $5,738,000 ~~$1,413,000~~ and ~~$1,997,000~~$1,413,000 of capital gains were reclassified out of Accumulated Other Comprehensive Income into earnings during fiscal years ended April 30, 2006, 2005, ~~2004,~~ and ~~2003,~~2004, respectively. The proceeds ~~received~~ from ~~the~~ sales of ~~these~~ securities including capital gain distributions reinvested in the Value Line Funds during the fiscal years ended April 30, 2006, 2005, and 2004 were $2,430,000, $12,671,000 and ~~2003 were $12,671,000,~~ $9,751,000, ~~and $39,598,000,~~ respectively. Proceeds and capital gains ~~for fiscal 2005 include~~included $75,000 and $433,000 from the installment sale of ~~shares of common stock, received from a vendor~~an investment in a ~~negotiated contract. An additional $74,000 is being~~privately held ~~in escrow until January 2006.~~company, during fiscal 2006 and 2005, respectively.

~~Value Line, Inc.~~

~~Notes to Consolidated Financial Statements~~

Government Debt Securities:

The Company's investments in debt securities are classified as available for sale and valued at market value. The aggregate cost and fair value at April 30, 2006 for U.S. government debt securities classified as available for sale were as follows:

			(In Thousands)
	Historical				Gross Unrealized
Maturity	Cost		Fair Value		Holding Losses
Due in less than 2 years	$	10,778	$	10,641		($137	)
Due in 2-5 years		8,745		8,630		(115	)
Total investment in debt securities	$	19,523	$	19,271		($252	)

The aggregate cost and fair value at April 30, 2005 for U.S. government debt securities classified as available for sale were as follows:

			(In Thousands)							(In Thousands)
	Historical Cost		Fair Value		Gross Unrealized Holding Losses			Historical				Gross Unrealized
Maturity								Cost		Fair Value		Holding Losses
Due in less than 2 years	$	34,506	$	34,481		($25	)	$	34,506	$	34,481		($25	)
Due in 2-5 years		4,587		4,584		(3	)		4,587		4,584		(3	)
Total investment in debt securities	$	39,093	$	39,065		($28	)	$	39,093	$	39,065		($28	)

~~The aggregate cost and fair value at April 30, 2004 for U.S. government debt securities classified as available for sale were as follows:~~

(In Thousands)

Historical
Cost
Fair Value
Gross Unrealized
Holding Gains

Maturity
Due in 1-2 years $ 1 $ 1 $ 0
Total investment in debt securities $ 1 $ 1 $ 0

The unrealized ~~loss~~losses of $252,000 and $28,000 in U.S. government debt securities ~~was~~net of deferred taxes of $89,000 and $10,000, respectively, were included in Accumulated Other Comprehensive Income on the Consolidated Balance Sheets as of April 30, ~~2005. There are no gains or losses on U.S. government~~2006 and 2005, respectively. During fiscal year 2006, the Company reclassified $18,038,000 of US Government debt securities ~~included~~from the classification of available for sale to trading securities that resulted in the recognition and reclassification of an unrealized loss of $129,000 from Accumulated Other Comprehensive Income onto the Consolidated ~~Balance Sheets as~~Condensed Statement of ~~April 30, 2004.~~Income.

The average yield on the U.S. Government debt securities classified as available for sale at April 30, ~~2005~~2006 and April 30, ~~2004~~2005 was ~~3.62%~~3.76% and ~~2.59%~~3.62%, respectively.

Proceeds from sales of government debt securities classified as available for sale during fiscal years 2006, 2005, ~~were$9,019,000.~~and 2004 were $9,650,000, $9,019,000 and $230,210,000, respectively. There were no related gains or ~~losses.~~

~~Proceeds from~~losses on sales of government debt securities ~~classified as available for sale~~ during fiscal 2006 or 2005. In fiscal 2004, ~~were$230,210,000 and~~ the related loss on sales ~~which were~~of $354,000 was reclassified from Accumulated Other Comprehensive Income in the Balance Sheet, was $354,000. Proceeds from sales of government debt securities available for sale during fiscal 2003 were $57,471,000 and the related gain on sales, which were reclassified from Accumulated Other Comprehensive Income on the Balance Sheet, was $602,000.

For the years ended April 30, 2005, 2004, and 2003, income from securities transactions also included $239,000, $247,000,and $832,000 of dividend income; $363,000, $4,012,000, and $3,529,000 of interest income; and $7,000, $18,000 and $49,000 of related interest expense, respectively.

Sheet.

38-39-

Value Line, Inc.

Notes to Consolidated Financial Statements

For the years ended April 30, 2006, 2005, and 2004, income from securities transactions also included $483,000, $239,000,and $247,000 of dividend income; $1,361,000, $363,000, and $4,012,000 of interest income; and $11,000, $7,000 and $18,000 of related interest expense, respectively.

Note 5-Property and Equipment:

Property and equipment are carried at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets, or in the case of leasehold improvements, over the remaining terms of the leases. For income tax purposes, depreciation of furniture and equipment is computed using accelerated methods and buildings and leasehold improvements are depreciated over prescribed, extended tax lives.

Property and equipment consist of the following:

April 30,
2005 2004
(in thousands)
Land $ 726 $ 726
Building and leasehold improvements 7,834 7,834
Furniture and equipment 10,752 10,569
19,312 19,129
Accumulated depreciation and amortization (13,328 ) (12,584 )
$ 5,984 $ 6,545

	April 30,
	2006			2005
	(in thousands)

Land	$	726		$	726
Building and leasehold improvements		7,284			7,834
Furniture and equipment		10,652			10,752
		18,662			19,312
Accumulated depreciation and amortization		(13,256	)		(13,328	)
	$	5,406		$	5,984

Note 6-Federal, State and Local Income Taxes:

The Company computes its income tax provision in accordance with the provisions of Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes".

The provision for income taxes includes the following:

Years ended April 30,

2005 2004 2003
Current: (in thousands)
Federal $ 11,860 $ 10,453 $ 10,383
State and local 2,555 2,056 2,041
14,415 12,509 12,424
Deferred:
Federal (361 ) 134 (1,704 )
State and local (10 ) 12 14
(371 ) 146 (1,690 )
Provision for income taxes $ 14,044 $ 12,655 $ 10,734

	Year ended April 30,
	2006			2005			2004
	(in thousands)
Current:
Federal	$	12,486		$	11,860		$	10,453
State and local		3,328			2,555			2,056
		15,814			14,415			12,509
Deferred:
Federal		(148	)		(361	)		134
State and local		(56	)		(10	)		12
		(204	)		(371	)		146
Provision for income taxes	$	15,610		$	14,044		$	12,655

Deferred taxes are provided for temporary differences between the financial reporting basis and the tax basis of the Company's assets and liabilities. The tax effect of temporary differences giving rise to the Company's deferred tax (liability)/asset are as follows:

~~Value Line, Inc.~~

~~Notes to Consolidated Financial Statements~~

Years ended April 30,
2005 2004 2003
(in thousands)

Unrealized gains on securities held for sale ($6,304 ) ($7,648 ) ($5,370 )
Unrealized gains on trading securities — (395 ) (65 )
Depreciation and amortization (356 ) (101 ) (294 )
Deferred professional fees 342 348 340
Deferred charges 183 151 308
Other, net (41 ) 65 (127 )
($6,176 ) ($7,580 ) ($5,208 )

	Year ended April 30,
	2006			2005			2004
	(in thousands)

Unrealized gains on securities held for sale		($8,715	)		($6,304	)		($7,648	)
Unrealized gains on trading securities		(76	)		—			(395	)
Depreciation and amortization		(90	)		(356	)		(101	)
Deferred professional fees		246			342			348
Deferred charges		214			183			151
Other, net		(15	)		(41	)		65
		($8,436	)		($6,176	)		($7,580	)

Included in deferred income taxes in total current assets are deferred state and local income taxes of ~~$32,000~~$88,000 and ~~$104,000~~$32,000 at April 30, ~~2005~~2006 and ~~2004,~~2005, respectively.

-40-

Value Line, Inc.

Notes to Consolidated Financial Statements

The provision for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory income tax rate to pretax income as a result of the following:

Years ended April 30,
2005 2004 2003
(in thousands)

Tax expense at the U.S. statutory rate $ 12,377 $ 11,552 $ 10,752
Increase (decrease) in tax expense from:
State and local income taxes, net of
federal income tax benefit 1,654 1,344 1,336
Effect of tax exempt income and dividend
deductions (88 ) (278 ) (95 )
Other, net 101 37 (1,259 )
Provision for income taxes $ 14,044 $ 12,655 $ 10,734

The provision for income taxes has been reduced by approximately $1,257,000 for the fiscal year ended April 30, 2003, primarily resulting from the favorable disposition of a pending tax audit, which was concluded during the year.

	Year ended April 30,
	2006			2005			2004
				(in thousands)

Tax expense at the U.S. statutory rate	$	13,667		$	12,377		$	11,552
Increase (decrease) in tax expense from:
State and local income taxes, net of
federal income tax benefit		2,127			1,654			1,344
Effect of tax exempt income and dividend deductions		(293	)		(88	)		(278	)
Other, net		109			101			37
Provision for income taxes	$	15,610		$	14,044		$	12,655

The Company is included in the consolidated federal income tax return of the Parent. The Company has a tax sharing arrangement which requires it to make tax payments to the Parent equal to the Company's liability as if it filed a separate return.

~~Value Line, Inc.~~

~~Notes to Consolidated Financial Statements~~

Note 7-Employees' Profit Sharing and Savings Plan:

Substantially all employees of the Company and its subsidiaries are members of the Value Line, Inc. Profit Sharing and Savings Plan (the "Plan"). In general, this is a qualified, contributory plan which provides for a discretionary annual Company contribution which is determined by a formula based upon the salaries of eligible employees and the amount of consolidated net operating income as defined in the Plan. Plan expense, included in salaries and employee benefits in the Consolidated Statements of Income and Retained Earnings, for the years ended April 30, 2006, 2005, and 2004 was $1,244,000, $1,082,000, and ~~2003 was $1,082,000,~~ $1,217,000, ~~and $862,000,~~ respectively.

Note ~~8-Incentive Stock Options:~~

On April 17, 1993, the Incentive Stock Option Plan expired. On the date of expiration, 22,550 options available for grant were cancelled. Information on the Incentive Stock Option Plan for the three years ended April 30, 2005, is as follows:

Number of
Shares

Option
Prices

Outstanding at April 30, 2002 1,475 $ 29.75
Granted —
Exercised (1,475 ) $ 29.75
Cancelled —
Outstanding at April 30, 2003 —
Granted —
Exercised —
Cancelled —
Outstanding at April 30, 2004 —
Granted —
Exercised —
Cancelled —
Outstanding at April 30, 2005 —

At April 30, 2005, all of the options under the option plan were exercised. Of the common stock held in treasury at April 30, 2002, 1,475 shares were issued during fiscal 2003 for the exercise of stock options.

~~Value Line, Inc.~~

~~Notes to Consolidated Financial Statements~~

~~Note 9-Treasury Stock:~~

~~Treasury stock, at cost, for the three years ended April 30, 2005, consists of the following:~~

Shares Amount
(in thousands)

Balance April 30, 2002 19,875 $ 383
Exercise of incentive stock options (1,475 ) (29 )
Balance April 30, 2003 18,400 $ 354
Exercise of incentive stock options — —
Balance April 30, 2004 18,400 $ 354
Exercise of incentive stock options — —
Balance April 30, 2005 18,400 $ 354

~~Note 10-Lease~~8-Lease Commitments:

On June 4, 1993, the Company entered into a 15 year lease agreement to provide primary office space. The lease includes free rental periods as well as scheduled base rent escalations over the term of the lease. The lease expires in May 2008 subject to an option to the Company to extend the term for 5 additional years at a market rental rate. The total amount of the base rent payments is being charged to expense on the straight-line method over the term of the lease. The Company has recorded a deferred charge on its Consolidated Balance Sheets to reflect the excess of annual rental expense over cash payments since inception of the lease. On September 14, 2000, the Company amended its lease for primary office space and returned to the landlord approximately 6,000 square feet of excess office capacity, reducing the Company's future minimum lease payments accordingly. On January 19, 2006, the Company amended its lease for primary office space and returned to the landlord approximately 11,000 square feet of excess office capacity, reducing the Company's future minimum lease payments accordingly.

Future minimum payments, exclusive of forecasted increases in real estate taxes and wage escalations, under operating leases for equipment and office space, with remaining terms of one year or more, are as follows:

Year ended April 30: (in thousands)

2006 1,788
2007 1,788
2008 1,148
Thereafter 21
$ 4,745

Year ended April 30:		(in thousands)

	2007	$	1,690
	2008		1,039
	2009		162
	2010		108
	Thereafter		—
		$	2,999

Rental expense for the years ended April 30, 2006, 2005 ~~2004~~ and ~~2003~~2004 under operating leases covering office space was $1,724,000, $1,799,000, and $1,544,000, ~~and $1,350,000,~~ respectively.

42-41-

Value Line, Inc.

Notes to Consolidated Financial Statements

Note ~~11-Business~~9-Business Segments:

The Company operates two reportable business segments: Publishing and Investment Management Services. The publishing segment produces investment related periodicals in both print and electronic ~~form.~~form, and licensing fees. The investment management segment provides advisory services to ~~mutual funds,~~the Value Line Funds, as well as institutional and individual ~~clients as well as brokerage services for the Value Line family of mutual funds.~~accounts. The segments are differentiated by the products and services they offer.

The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The Company allocates all revenues and expenses, except for depreciation and income from securities transactions related to corporate assets, between the two reportable segments.

Disclosure of Reportable Segment Profit and Segment Assets (in thousands)

April 30, 2005

Publishing Investment Total

Management
Services

Revenues from external customers $ 52,713 $ 31,765 $ 84,478
Intersegment revenues 180 — 180
Income from securities transactions 14 7,914 7,928
Depreciation and amortization 2,384 106 2,490
Segment profit 16,420 10,680 27,100
Segment assets 14,871 44,409 59,280
Expenditures for segment assets 1,441 189 1,630


				April 30, 2004			April 30, 2006
		Publishing		Investment		Total	Publishing &		Investment
				Management Services			Licensing		Management		Total

Revenues from external customers	$	52,497	$	32,773	$	85,270	$	52,719	$	32,467	$	85,186
Intersegment revenues		193		—		193		114		—		114
Income from securities transactions		4		8,262		8,266		62		2,922		2,984
Depreciation and amortization		2,632		62		2,694		2,169		88		2,257
Segment profit		14,391		10,380		24,771		20,041		15,158		35,199
Segment assets		14,592		74,786		89,378		14,861		81,762		96,623
Expenditures for segment assets		2,128		45		2,173		933		9		942

	April 30, 2005
	Publishing &		Investment
	Licensing		Management		Total

Revenues from external customers	$	52,713	$	31,765	$	84,478
Intersegment revenues		180		—		180
Income from securities transactions		14		7,914		7,928
Depreciation and amortization		2,384		106		2,490
Segment profit		16,420		10,680		27,100
Segment assets		14,871		44,409		59,280
Expenditures for segment assets		1,441		189		1,630

	April 30, 2004
	Publishing &		Investment
	Licensing		Management		Total

Revenues from external customers	$	52,497	$	32,773	$	85,270
Intersegment revenues		193		—		193
Income from securities transactions		4		8,262		8,266
Depreciation and amortization		2,632		62		2,694
Segment profit		14,391		10,380		24,771
Segment assets		14,592		74,786		89,378
Expenditures for segment assets		2,128		45		2,173

43-42-

Value Line, Inc.

Notes to Consolidated Financial Statements

April 30, 2003

Publishing Investment Total
Management
Services

Revenues from external customers $ 52,469 $ 29,600 $ 82,069
Intersegment revenues 180 — 180
Income from securities transactions 38 6,588 6,626
Depreciation and amortization 3,080 156 3,236
Segment profit 13,660 10,473 24,133
Segment assets 18,648 227,786 246,434
Expenditures for segment assets 1,571 37 1,608

Reconciliation of Reportable Segment Revenues,

Operating Profit and Assets

(in thousands)


	2005			2004			2003			2006			2005			2004
Revenues
Total revenues for reportable segments	$	84,658		$	85,463		$	82,249		$	85,300		$	84,658		$	85,463
Elimination of intersegment revenues		(180	)		(193	)		(180	)		(114	)		(180	)		(193	)
Total consolidated revenues	$	84,478		$	85,270		$	82,069		$	85,186		$	84,478		$	85,270

Segment profit
Total profit for reportable segments	$	35,028		$	33,037		$	30,759		$	38,183		$	35,028		$	33,037
Add: Income from securities transactions
related to corporate assets		350			—			—			884			350			—
Less: Depreciation related to corporate assets		(16	)		(32	)		(38	)		(18	)		(16	)		(32	)
Income before income taxes	$	35,362		$	33,005		$	30,721		$	39,049		$	35,362		$	33,005

Assets
Total assets for reportable segments	$	59,280		$	89,378		$	246,434		$	96,623		$	59,280		$	89,378
Corporate assets		39,585			177,546			380			22,591			39,585			177,546
Consolidated total assets	$	98,865		$	266,924		$	246,814		$	119,214		$	98,865		$	266,924

Note ~~12-Net~~10-Net Capital:

The Company's wholly owned subsidiary, Value Line Securities, Inc., is subject to the net capital provisions of Rule 15c3-1 under the Securities Exchange Act of 1934, which requires the maintenance of minimum net capital of $100,000 or one-fifteenth of aggregate indebtedness, if larger. Additionally, dividends may only be declared if aggregate indebtedness is less than twelve times net capital.

At April 30, ~~2005,~~2006, the net capital, as defined, of Value Line Securities, Inc. of ~~$3,363,800~~$23,866,195 exceeded required net capital by ~~$3,263,800~~$23,766,195 and the ratio of aggregate indebtedness to net capital was ~~.24~~.06 to 1.

~~Value Line, Inc.~~

~~Notes to Consolidated Financial Statements~~

Note ~~13-Disclosure~~11-Disclosure of Credit Risk of Financial Instruments with Off Balance Sheet Risk:

In the normal course of business, the Company enters into contractual commitments, ~~principally~~including financial futures contracts for securities indices. Financial futures contracts provide for the delayed delivery of financial instruments for which the seller agrees to make delivery at a specified future date, at a specified price or yield. The contract or notional amount of these contracts reflects the extent of involvement the Company has in these contracts. At April 30, ~~2005~~2006 and ~~2004,~~2005, the Company did not have any investment in financial futures contracts. The Company limits its credit risk associated with such instruments by entering into exchange traded future contracts.

Although Value Line Securities, Inc. did not do so during fiscal 2006, during prior periods it executed, as agent, securities transactions on behalf of the Value Line ~~mutual funds.~~Funds. If either the mutual fund or a counter party ~~fail~~fails to perform, Value Line Securities, Inc. ~~may~~might be required to discharge the obligations of the nonperforming party. In such circumstances, Value Line Securities, Inc. ~~may~~might sustain a loss if the market value of the security is different from the contract value of the transaction.

NoOther than the Value Line Funds as explained in note 3, no single customer accounted for a significant portion of the Company's sales in 2006, 2005 ~~2004~~ or ~~2003,~~2004, nor accounts receivable for ~~2005~~2006 or ~~2004.~~2005.

Note ~~14-Comprehensive~~12-Comprehensive Income:

~~During the fiscal year 1999, the~~The Company has adopted Financial Accounting Standards No. 130, "Reporting Comprehensive Income". Statement No. 130 requires the reporting of comprehensive income in addition to net income from operations. Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income.

At April 30, 2006, 2005, ~~2004,~~ and ~~2003,~~2004, the Company held both equity securities and U.S. Government debt securities that are classified as Available for Sale on the Consolidated Balance Sheets. The change in valuation of these securities, net of deferred income taxes, has been recorded in Accumulated Other Comprehensive Income in the Company's Balance Sheets.

-43-

Value Line, Inc.

Notes to Consolidated Financial Statements

The components of comprehensive income that are included in the Statement of Changes in Shareholders' Equity are as follows:

(in thousands)
Before Tax Net of
Tax (Expense) Tax
Year ended 4-30-05 Amount or Benefit Amount
Unrealized Gains on Securities:
Unrealized Holding Gains/(Losses)
Arising during the period $ 1,902 ($666 ) $ 1,236
Less: Reclassification adjustments
for gains realized in net income (5,738 ) 2,008 (3,730 )
Other Comprehensive income ($3,836 ) $ 1,342 ($2,494 )

Year ended 4-30-04
Unrealized Gains on Securities:
Unrealized Holding Gains/(Losses)
Arising during the period $ 7,566 ($2,649 ) $ 4,917
Less: Reclassification adjustments
for gains realized in net income (1,059 ) 371 (688 )
Other Comprehensive income $ 6,507 ($2,278 ) $ 4,229

Year ended 4-30-03
Unrealized Gains on Securities:
Unrealized Holding Gains/(Losses)
Arising during the period ($13,831 ) $ 4,840 ($8,991 )
Less: Reclassification adjustments
for gains realized in net income ($2,599 ) 910 (1,689 )
Other Comprehensive income ($16,430 ) $ 5,750 ($10,680 )


				(in thousands)
	Before			Tax			Net of
	Tax			(Expense)			Tax
	Amount			or Benefit			Amount
Year ended 4-30-06
Unrealized Gains on Securities:
Unrealized Holding Gains/(Losses) Arising during the period	$	8,971			($3,195	)	$	5,776
Add: Reclassification adjustments for
losses realized in net income		129			(45	)		84
Less: Reclassification adjustments
for gains realized in net income		(2,355	)		829			(1,526	)
Other Comprehensive income	$	6,745			($2,411	)	$	4,334

Year ended 4-30-05
Unrealized Gains on Securities:
Unrealized Holding Gains/(Losses) Arising during the period	$	1,902			($666	)	$	1,236
Less: Reclassification adjustments
for gains realized in net income		(5,738	)		2,008			(3,730	)
Other Comprehensive income		($3,836	)	$	1,342			($2,494	)

Year ended 4-30-04
Unrealized Gains on Securities:
Unrealized Holding Gains/(Losses) Arising during the period	$	7,566			($2,649	)	$	4,917
Less: Reclassification adjustments
for gains realized in net income		(1,059	)		371			(688	)
Other Comprehensive income	$	6,507			($2,278	)	$	4,229

45-44-

Value Line, Inc.

Notes to Consolidated Financial Statements

Note ~~15-Accounting~~13-Accounting for the Costs of Computer Software Developed for Internal Use:

~~During fiscal year 1999, the~~The Company has adopted the provisions of the Statement of Position 98-1, ~~(SOP98-1)~~(SOP 98-1), "Accounting for the Costs of Computer Software Developed for Internal Use". SOP 98-1 is effective for tax years ending after December 31, 1998.

~~The~~ SOP 98-1 requires companies to capitalize as long-lived assets many of the costs associated with developing or obtaining software for internal use and amortize those costs over the software's estimated useful life in a systematic and rational manner.

At April 30, ~~2005~~2006 and ~~2004,~~2005, the Company capitalized ~~$861,000~~$508,000 and ~~$1,123,000~~$861,000 of costs related to the development of software for internal use. Such costs are capitalized and amortized over the expected useful life of the asset which is approximately 3 years. Amortization expense for the years ended April ~~30,2005,~~30, 2006, 2005 and 2004 was $916,000, $940,000, and ~~2003 was $940,000,~~ $889,000, ~~and $1,062,000,~~ respectively.

Note ~~16-Contingencies:~~14-Contingencies:

~~The~~On September 17, 2003 the Company commenced an action in New York Supreme Court, seeking damages in an unspecified amount, against a small mutual fund company pertaining to a contemplated transaction. The Company was countersued for alleged damages in excess of $5,000,000. The action was settled in November 2004 without a material adverse effect on the Company. A related entity of the defendant in the New York action brought suit against the Company and certain Directors in Federal Court in Texas in March, 2004 based on the same transaction. On the Company's motion, that action has been transferred from Texas to New York. On March 2, 2006 the Federal Judge in New York granted the Company's motion dismissing three causes of action. The court allowed one cause of action to continue at this time. Although the ultimate outcome of the litigation is subject to the inherent uncertainties of any legal proceeding, based upon Counsel's analysis of the factual and legal issues and the Company's meritorious defenses, it is management's belief that the expected outcome of this matter will not have a material adverse effect on the Company's consolidated results of operations and financial condition.

By letter dated June 15, 2005, the staff of the Securities and Exchange Commission ~~requested~~informed the Company ~~as part of~~that it was conducting a preliminary ~~inquiry to provide~~inquiry. Thereafter, the staff has requested documents and information relating to, among other things, trades for the Company's and affiliates' proprietary accounts, ~~and~~ the ~~effectuation and~~ execution of trades through VLS for the Value Line ~~Funds.~~Funds and the fees collected by VLS from the Value Line Funds pursuant to a Service and Distribution Plan. The Company ~~intends to cooperate~~and its subsidiaries are cooperating with the ~~preliminary~~ inquiry. Management cannot determine the effect, if any, that the inquiry will have on the results of operation and financial condition.

-45-

Value Line Inc.
Schedule 1-Marketable Securities
As of April 30, 2006

	Number of		Historical		Market
	Shares		Cost		Value

Marketable Securities
Federal Home Loan Bank 3.375% Due 2/07		15,000		14,758,500		14,782,500
Missouri State Cert. Participation Muni Bond 5% due 6/08		3,155		3,279,591		3,232,771
Orange Cnty Fla Tourist Dev. Tax Muni Bond 5.5% due 10/20		3,000		3,220,980		3,171,840
Potterville MI Public School Muni Bond 5.75% due 5/20		1,065		1,143,704		1,126,962
Total Marketable Securities			$	22,402,775	$	22,314,073

46-46-

~~Note 17-Restatement of Financial Position:~~

The Company has in the past consistently classified its unearned revenue, which represents the amount of subscription fees to be earned by servicing subscriptions after the date of the balance sheet (see Note 1),as a non-current deferred credit. This classification recognized that the fulfillment of this commitment will require the use of significantly fewer current assets than the amount of the unearned revenues. The Company has reclassified its unearned revenue to conform with the provisions of Accounting Research Bulletin No. 43, and accordingly has restated its consolidated financial statements for the years ended April 30, 2004 and 2003 to reflect the portion of the unearned revenue that will be recognized during the twelve months following the date of the balance sheet as a current liability. This presentation is also used for the year ended April 30, 2005.This presentation is in conformity with generally accepted accounting principles.

In connection with the aforementioned reclassification of the unearned revenue, the Company decided to reclassify securities available for sale from non-current to current assets. As previously discussed, the Company uses significantly fewer current assets than the amount of the unearned revenues to fulfill its commitments to serve its subscribers. However, in the unlikely event that the need arises to fully satisfy its current liabilities immediately, the Company could do so by selling a portion of its portfolio of securities available for sale. Therefore, in light of the reclassification of its unearned revenue, the Company believes that reclassifying its available for sale securities as current assets will more accurately reflect the liquidity position of the Company. The deferred income taxes liability, which primarily represents future taxes on the unrealized gains on the available for sale securities has also been reclassified as a current liability.

Accordingly, the accompanying consolidated financial statements, as of April 30, 2004 and 2003 and for the years then ended have been restated from those originally reported to reflect the reclassification of unearned revenue and available for sale securities. The change in the classification of unearned revenue and available for sale securities has no impact on the Company's reported net income or cash flows.

~~Summarized financial information illustrating the effect of the restatement on the Company's consolidated financial statements is as follows:~~

April 30, 2004

As Originally
Reported As Restated
Financial Position
Current Assets
Securities available for sale $ — $ 46,357

Long-Term Assets
Long-term securities available for sale 46,357 —

Current Liabilities
Unearned revenue — 29,407
Deferred Income Taxes 7,684

Long-Term Liabilities
Unearned revenue 40,871 11,464
Deferred Income Taxes 7,684

Value Line Inc.
Schedule X111-Other Investments: 4/30/06

	Historical		Market
Investments In Value Line Mutual Funds	Cost		Value
The Value Line Fund		655,157		661,098
The Value Line Income & Growth Fund		607,822		611,445
The Value Line Emerging Opportunity Fund		6,437,825		17,806,316
The Value Line Asset Allocation Fund		13,930,768		27,561,937
Total Investment In Value Line Mutual Funds	$	21,631,572	$	46,640,796

300 Shares of National Association of Securities Dealers, Inc.	$	3,300	$	3,300

Fixed Income Investments

Treasury Note 2.625% due 11/06		5,704,898		5,628,750
Chicago Illinois School Finance Muni Bond 5.375% due 6/08		1,244,814		1,205,402
Texas Tax & Revenue 4.5% due 8-31-06		5,073,100		5,012,250
Georgia State General Obligation Muni Bond 5% due 12/08		3,175,260		3,099,570
Weekly Adjustable Northern California Transmission Muni Bond due 5/24		4,325,000		4,325,000
Total Fixed Income Investments	$	19,523,072	$	19,270,972


Total Securities Available For Sale	$	41,157,944	$	65,915,068

47-47-

Value Line, Inc.

Schedule XIII-Other Investments:4/30/2005

Securities Available For Sale:

Historical

Market

Cost

Value

Investments In Value Line Mutual Funds

The Value Line Fund

569,463

497,873

The Value Line Income & Growth Fund

556,405

511,258

The Value Line Emerging Opportunity Fund, Inc.

6,225,491

13,434,320

The Value Line Asset Allocation Fund, Inc.

11,814,390

22,762,400

Total Investments In Value Line Mutual Funds

$
19,165,749

$
37,205,851

Other Investments:

300 Shares of National Association of Securities Dealers, Inc.

$
3,300

$
3,300

Fixed Income Investments

Chicago Illinois School Finance Muni Bond 5.375% due 6/08

1,244,814

1,245,408

Missouri State Cert. Participation Muni Bond 5% due 6/08

3,342,565

3,338,495

Treasury Note 2.625% due 11/07

5,704,898

5,623,406

Federal Home Loan Bank 3.375% due 2/07

14,824,875

14,881,350

Federal Home Loan Bank 2.50% due 4/06

1,000

989

Weekly Adjustable Northern California Transmission Muni Bonds due 5/24

5,475,000

5,475,000

Weekly Adjustable Energy Northwest WA Muni Bond due 7/18

8,500,000

8,500,000

Total Fixed Income Investments

$
39,093,152

$
39,064,648

Total Securities Available For Sale

$
58,262,201

$
76,273,799

New York		13-3139843
(State or other jurisdiction of	~~(IRS Employer Identification~~
incorporation or organization)	~~Number)~~	(I.R.S. Employer Identification No.)

220 East 42nd Street, New York, New York		10017-5891
(Address of principal executive offices)		(Zip Code)

	(in thousands)

Unit Investment Trusts	$	4,200,000
Closed-end Funds	$	1,100,000
Exchange Traded Fund	$	160,000
Other	$	800,000
	$	6,260,000


	(in thousands)
			(in thousands)
The Value Line Fund, Inc.	$	192,580	$	233,250
Value Line Income and Growth Fund, Inc.		230,108		340,626
The Value Line Special Situations Fund, Inc.		367,407
Value Line Leveraged Growth Investors, Inc.		279,220
The Value Line Premier Growth Fund, Inc.				494,566
Value Line Larger Companies Fund, Inc.				327,697
The Value Line Cash Fund, Inc.		159,814		166,142
Value Line U.S. Government Securities Fund, Inc.		114,313		100,158
Value Line Centurion Fund, Inc.		306,180		343,631
The Value Line Tax Exempt Fund, Inc.		135,444		112,617
Value Line Convertible Fund, Inc.		38,670		36,505
Value Line Aggressive Income Trust		47,756		41,328
Value Line New York Tax Exempt Trust		25,650		23,414
Value Line Strategic Asset Management Trust		712,537		711,438
Value Line Emerging Opportunities Fund, Inc.		394,635		695,795
Value Line Asset Allocation Fund, Inc.		123,668		143,288
	$	3,127,982	$	3,770,455

I. Closed -End Fund Licensed Product Offerings	Assets

A. First Trust Value Line 100 Closed-End Trust	$	305,000,000

B. First Trust Value Line Dividend Closed-End Trust	$	530,000,000

C. First Trust Value Line & Ibbotson Equity Allocation Fund	$	150,000,000

II. Other Investment Products Including Unit Investment Trusts	$	900,000,000

x
x	~~Annual Report Pursuant to Section~~ ANNUAL REPORT PURSUANT TO SECTION 13 ~~or 15(d) of the~~
	~~Securities Exchange Act of~~OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

Name	Age	Principal Occupation or Employment

Jean Bernhard Buttner	7071	Chairman of the Board, President and Chief Executive Officer of the Company and AB&Co. Chairman of the Board and President of each of the Value Line Funds.

Samuel Eisenstadt	8284	Senior Vice President and Research Chairman.

Howard A. Brecher	52	Vice President and Secretary; Assistant Treasurer and Assistant Secretary of each of the Value Line Funds since 2005; Vice President, Secretary, Treasurer and General Counsel of AB&Co.

David T. Henigson	4748	Vice President; ~~Director of Compliance;~~Chief Compliance Officer; Vice President, Secretary, ~~Treasurer~~ and Chief Compliance Officer of each of the Value Line Funds; Vice President of AB&Co.

~~Howard A. Brecher~~	51	~~Vice President and Secretary; Vice President, Secretary, Treasurer and General Counsel of AB&Co.~~

Stephen R. Anastasio	4647	Treasurer of the Company and each of the Value Line Funds since September 2005; Chief Financial Officer ~~since 2003;~~from 2003 to September 2005; Corporate ~~Controller.~~Controller until 2003.

Mitchell E. Appel	3435	Chief Financial Officer since September 2005; Treasurer ~~since~~from June ~~2005.~~to September 2005; Chief Financial Officer, Circle Trust Company ~~(January~~from January 2003 -to May ~~2005),~~2005; Vice President - Finance, Orbitex Financial Services Group and Treasurer of Orbitex Group of Funds from 2000 ~~- 2002 .~~
		to 2002.

									Dividend
	High				Low				Declared
Quarter Ended	Bid		Asked		Bid		Asked		Per Share

July 31, 2004⁽¹⁾	$	64.260	$	69.500	$	29.500	$	31.320	$	.25
October 31, 2004	$	38.110	$	39.480	$	32.960	$	35.530	$	.25
January 31, 2005	$	41.760	$	41.760	$	35.950	$	35.950	$	.25
April 30, 2005	$	41.500	$	42.500	$	38.500	$	38.750	$	.25

July 31, 2005	$	39.500	$	40.020	$	30.570	$	34.000	$	.25
October 31, 2005	$	39.500	$	40.000	$	36.010	$	37.060	$	.25
January 31, 2006	$	41.480	$	43.040	$	33.510	$	34.000	$	.25
April 30, 2006	$	41.180	$	41.960	$	33.110	$	33.360	$	.25

	~~ISSUER PURCHASES OF EQUITY SECURITIES~~

Period	(a) Total Number of Shares (or Units) Purchased	(b) Average Price Paid Per Share (or Unit)	(c) ~~(c)~~ Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs	(d) ~~(d)~~ Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
February 1, ~~2005~~ 2006 through February 28, ~~2005~~ 2006	— -----	— -----	— -----	— -----
March 1, ~~2005~~ 2006 through March 31, ~~2005~~ 2006	— -----	— -----	— -----	— -----
April 1, ~~2005~~ 2006 through April 30, ~~2005~~ 2006	—-----	— -----	— -----	— -----
Total	—-----	—-----	—-----	—-----

Contractual Obligations	Total		Less than 1 Year		1-3 years		3-5 years		After 5 Years
Operating Lease Obligations	$	4,745	$	1,788	$	2,957		—		—
Purchase Obligations		—		—		—		—		—
Other Long-term Obligations reflected on Balance Sheet	$	40,092	$	29,748	$	10,344		—		—
TOTAL	$	44,837	$	31,536	$	13,301		—		—

	Page Numbers

Report of independent accountants	3032
Consolidated balance sheets--April 30, ~~2005~~2006 and ~~2004~~2005	3133
Consolidated statements of income and retained earnings
~~--years~~ -- years ended April 30, 2006, 2005 ~~2004~~ and ~~2003~~2004	3234
Consolidated statements of cash flows
~~--years~~ -- years ended April 30, 2006, 2005 ~~2004~~ and ~~2003~~2004	3335
Consolidated statement of changes in shareholders’ equity
~~--years~~ -- years ended April 30, 2006, 2005 ~~2004~~ and ~~2003~~2004	3436
Notes to the consolidated financial statements	3537 - 45
Supplementary schedules	4846 - 47

	Quarterly Results (Unaudited): (in thousands, except per share amounts)

	Total Revenues		Income From Operations		Net Income		Earnings Per Share
2005, by Quarter -
First	$	21,380	$	6,245	$	5,941	$	0.60
Second		20,922		5,868		5,798		0.58
Third.		21,058		6,437		4,657		0.46
Fourth		21,118		8,534		4,922		0.50
Total	$	84,478	$	27,084	$	21,318	$	2.14


2004, by Quarter -
First	$	21,057	$	5,572	$	4,998	$	0.50
Second		20,670		5,827		5,525		0.55
Third		21,498		6,040		4,904		0.49
Fourth		22,045		7,300		4,923		0.50
Total	$	85,270	$	24,739	$	20,350	$	2.04
2003, by Quarter -
First.	$	20,505	$	4,975	$	3,000	$	0.30
Second		20,386		6,379		4,524		0.45
Third		21,153		5,898		5,671		0.57
Fourth.		20,025		6,843		6,792		0.68
Total	$	82,069	$	24,095	$	19,987	$	2.00

(a) Names of Directors, Age as of		Director
June ~~9, 2005~~30, 2006 and Principal Occupation		Since

Jean Bernhard Buttner* ~~(70)~~(71). Chairman of the Board, President, and Chief Executive Officer of the Company and Arnold Bernhard & Co., Inc. Chairman of the Board and President of each of the Value Line Funds.		~~1982~~

~~Harold Bernard, Jr. (74). Attorney-at-law. Retired Administrative Law Judge,~~ ~~National Labor Relations Board. Director of Arnold Bernhard & Co., Inc. Judge Bernard is a cousin of Jean Bernhard Buttner.~~		1982

Samuel Eisenstadt ~~(82)~~(84). Senior Vice President and Research Chairman of the Company.		1982

Herbert Pardes, MD ~~(71)~~(72). President and CEO of New York- Presbyterian Hospital.		2000

Edward J. Shanahan ~~(61)~~(62). President and Headmaster, Choate Rosemary Hall ~~(boarding~~(boarding school); Director and Chairman, Foundation for Greater Opportunity ~~(not-for-profit charter school)~~(independent educational foundation).		2004

Dr. Edgar A. Buttner (43). Postdoctoral Fellow, Research Associate, Harvard University since 2003; Research Associate and Instructor, McLean Hospital, 2002-2003; Postdoctoral Fellow, Massachusetts Institute of Technology, 1997- 2001; Director of Arnold Bernhard & Co., Inc. Dr. Buttner is the son of Jean Bernhard Buttner.		2003

Marion N. Ruth (71). President, Ruth Realty.		2005

Howard A. Brecher* ~~(51)~~(52). Vice President and Secretary of the Company;Assistant Treasurer and Assistant Secretary of each of the Value Line Funds since 2005; Director, Vice President, Secretary, Treasurer and General Counsel of Arnold Bernhard & Co., Inc.~~; Assistant Treasurer and Secretary of each of the Value Line Funds since 2005.~~		1992

David T. Henigson* ~~(47)~~(48). Vice President and ~~Director~~Chief Compliance Officer of ~~Compliance of theCompany;~~the Company; Vice President, Secretary and ~~Treasurer~~Chief Compliance Officer of each of the Value Line Funds; Vice President and Director of Arnold Bernhard & Co., Inc.		1992

Edgar A. Buttner (42). Postdoctoral Fellow, Harvard University since 2003; Research Associate, McLean Hospital, 2002-2003; Postdoctoral Fellow, Massachusetts Institute of Technology, 1997-2001; Director of Arnold Bernhard & Co., Inc. Dr. Buttner is the son of Jean Bernhard Buttner.		~~2003~~

~~Marianne Asher (39). Private investor, graduate somatic counselor; Director of Arnold Bernhard & Co., Inc. Mrs. Asher is a daughter of Jean Bernhard Buttner.~~		~~2004~~

Name and Address of Beneficial Owner	Numberof Shares BeneficiallyOwned		Percentage of Shares Beneficially Owned (1)

Arnold Bernhard		8,631,032		86.47	%
& Co., Inc.(1)
220 East 42nd Street
New York, NY 10017

Name and Address	Number of Shares		Percentage of Shares
of Beneficial Owner	Beneficially Owned		Beneficially Owned¹

Arnold Bernhard		8,631,032		86.47	%
& Co., Inc.¹
220 East 42nd Street
New York, NY 10017


	VALUE LINE, INC. (Registrant) By: /s/ Jean Bernhard Buttner Jean Bernhard Buttner Chairman & Chief Executive Officer ~~(Registrant)~~

	~~By:~~	~~/s/ Jean Bernhard Buttner~~
		~~Jean Bernhard Buttner~~
		~~Chairman & Chief Executive Officer~~



	~~By:~~	~~/s/ Stephen R. Anastasio~~
		~~Stephen R. Anastasio~~
		~~Chief Financial Officer~~


/s/Jean Bernhard Buttner		/s/ Howard A. Brecher
Jean Bernhard Buttner		Howard A. Brecher


/s/~~Harold Bernard, Jr.~~ Edgar A. Buttner		/s/Samuel Eisenstadt
~~Harold Bernard, Jr.~~Edgar A. Buttner		Samuel Eisenstadt


/s/Edward J. Shanahan		/s/David T. Henigson
Edward J. Shanahan		David T. Henigson


/s/Dr. Herbert Pardes		/s/~~Edgar A. Buttner~~ Marion N. Ruth
Dr. Herbert Pardes	~~Edgar A. Buttner~~

~~/s/Marianne Asher~~
~~Marianne Asher~~


~~Dated: July 29, 2005~~	Marion N. Ruth

A member of the AICPA for Public Company Audit Firms	275 Madison Avenue
New York State Society of CPAs	New York, NY 10016
PCAOB registered	Telephone: (212) 532-3736
	Facsimile: (212) 545-8997
	E-mail: cpas@horowitz-ullmann.com

Value Line, Inc.
Consolidated Balance Sheets
(in thousands, except share amounts)

	Apr. 30, 2005			Apr. 30, 2004
				*(restated )**
Current Assets:
Cash and cash equivalents (including short term investments of $5,654 and $177,682, respectively)	$	5,971		$	178,108
Trading securities		—			19,981
Securities available for sale		76,274			46,357
Receivable from clearing brokers		—			5,356
Accounts receivable, net of allowance for doubtful accounts of $52, and $40, respectively		3,096			1,842
Receivable from affiliates		2,557			2,920
Prepaid expenses and other current assets		1,468			1,911
Deferred income taxes		32			104
Total current assets		89,398			256,579

Long term assets:
Property and equipment, net		5,984			6,545
Capitalized software and other intangible assets, net		3,483			3,800
Total long term assets		9,467			10,345
Total assets	$	98,865		$	266,924

Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable, accrued expenses and other liabilities	$	4,331		$	3,619
Accrued salaries		1,247			1,576
Dividends payable		2,495			177,172
Accrued taxes payable		—			422
Unearned revenue		29,748			29,407
Deferred income taxes		6,176			7,684
Total current liabilities		43,997			219,880

Long term liabilities:
Unearned revenue		10,344			11,464
Deferred charges		381			282
Total long term liabilities		10,725			11,746

Shareholders' Equity:
Common stock, $.10 par value; authorized 30,000,000 shares; issued 10,000,000 shares		1,000			1,000
Additional paid-in capital		991			991
Retained earnings		30,798			19,459
Treasury stock, at cost (18,400 shares on 4/30/05 & 4/30/04)		(354	)		(354	)
Accumulated other comprehensive income, net of tax		11,708			14,202
Total shareholders' equity		44,143			35,298
Total liabilities and shareholders' equity	$	98,865		$	266,924

	Number of common shares		Par value of common shares		Additional paid-in capital		Treasury Stock			Comprehensive income			Retained earnings			Accumulated other comprehensive income			Total

Balance at April 30, 2002		9,980,125	$	1,000	$	975		($383	)				$	173,760		$	20,653		$	196,005

Comprehensive income
Net income										$	19,987			19,987						19,987
Other comprehensive income, net of tax:
Change in unrealized gains on securities											(10,680	)					(10,680	)		(10,680	)
Comprehensive income										$	9,307
Exercise of stock options		1,475				16		29												45
Dividends declared														(9,979	)					(9,979	)
Balance at April 30, 2003		9,981,600	$	1,000	$	991		($354	)				$	183,768		$	9,973		$	195,378

Comprehensive income
Net income										$	20,350			20,350						20,350
Other comprehensive income, net of tax:
Change in unrealized gains on securities											4,229						4,229			4,229
Comprehensive income										$	24,579
Dividends declared														(184,659	)					(184,659	)
Balance at April 30, 2004		9,981,600	$	1,000	$	991		($354	)				$	19,459		$	14,202		$	35,298

Comprehensive income
Net income										$	21,318			21,318						21,318
Other comprehensive income, net of tax:
Change in unrealized gains on securities											(2,494	)					(2,494	)		(2,494	)
Comprehensive income										$	18,824
Dividends declared														(9,979	)					(9,979	)
Balance at April 30, 2005		9,981,600	$	1,000	$	991		($354	)				$	30,798		$	11,708		$	44,143


	Number of Shares			Option Prices
Outstanding at April 30, 2002		1,475		$	29.75
Granted		—
Exercised		(1,475	)	$	29.75
Cancelled		—
Outstanding at April 30, 2003		—
Granted		—
Exercised		—
Cancelled		—
Outstanding at April 30, 2004		—
Granted		—
Exercised		—
Cancelled		—
Outstanding at April 30, 2005		—

			April 30, 2005
	Publishing		Investment		Total
			Management Services

Revenues from external customers	$	52,713	$	31,765	$	84,478
Intersegment revenues		180		—		180
Income from securities transactions		14		7,914		7,928
Depreciation and amortization		2,384		106		2,490
Segment profit		16,420		10,680		27,100
Segment assets		14,871		44,409		59,280
Expenditures for segment assets		1,441		189		1,630

			April 30, 2003
	Publishing		Investment		Total
			Management
			Services

Revenues from external customers	$	52,469	$	29,600	$	82,069
Intersegment revenues		180		—		180
Income from securities transactions		38		6,588		6,626
Depreciation and amortization		3,080		156		3,236
Segment profit		13,660		10,473		24,133
Segment assets		18,648		227,786		246,434
Expenditures for segment assets		1,571		37		1,608


	April 30, 2004
	As Originally
	Reported		As Restated
Financial Position
Current Assets
Securities available for sale	$	—	$	46,357

Long-Term Assets
Long-term securities available for sale		46,357		—

Current Liabilities
Unearned revenue		—		29,407
Deferred Income Taxes				7,684

Long-Term Liabilities
Unearned revenue		40,871		11,464
Deferred Income Taxes		7,684

Value Line, Inc.
Schedule XIII-Other Investments:4/30/2005


Securities Available For Sale:	Historical		Market
	Cost		Value
Investments In Value Line Mutual Funds

The Value Line Fund		569,463		497,873
The Value Line Income & Growth Fund		556,405		511,258
The Value Line Emerging Opportunity Fund, Inc.		6,225,491		13,434,320
The Value Line Asset Allocation Fund, Inc.		11,814,390		22,762,400
Total Investments In Value Line Mutual Funds	$	19,165,749	$	37,205,851

Other Investments:

300 Shares of National Association of Securities Dealers, Inc.	$	3,300	$	3,300

Fixed Income Investments


Chicago Illinois School Finance Muni Bond 5.375% due 6/08		1,244,814		1,245,408
Missouri State Cert. Participation Muni Bond 5% due 6/08		3,342,565		3,338,495
Treasury Note 2.625% due 11/07		5,704,898		5,623,406
Federal Home Loan Bank 3.375% due 2/07		14,824,875		14,881,350
Federal Home Loan Bank 2.50% due 4/06		1,000		989
Weekly Adjustable Northern California Transmission Muni Bonds due 5/24		5,475,000		5,475,000
Weekly Adjustable Energy Northwest WA Muni Bond due 7/18		8,500,000		8,500,000
Total Fixed Income Investments	$	39,093,152	$	39,064,648

Total Securities Available For Sale	$	58,262,201	$	76,273,799