Note 9. - Fair Value Measurements: Fair Value Assets Measured on Nonrecurring Basis Impaired Loans Policy (Policies)	3 Months Ended
	Sep. 30, 2012
Policies
Fair Value Assets Measured on Nonrecurring Basis Impaired Loans Policy	Generally accepted accounting principles apply to loans measured for impairment using practical expedients, including impaired loans measured at an observable market price (if available), or at the fair value of the loan’s collateral (if the loan is collateral dependent). Fair value of the loan’s collateral, when the loan is dependent on collateral, is determined by appraisals or independent valuation which is then adjusted for the cost related to liquidation of the collateral. The fair value of a Level 2 collateral dependent loan is generally determined by a recent appraisal in the last twelve months. The fair value of a Level 3 collateral dependent loan is determined by reference to an appraisal older than twelve months in addition to cash flow analysis and/or other market evaluations.

COMMUNITY FINANCIAL CORP /VA/ 10-Q