"Picture" Formatting in Word 2011

[Ira]

I use a MacBook Pro (late 2006 model), with OS 10.6.6.

I just upgraded from Office for Mac 2004 to Office for Mac 2011. What
I'm about to describe works wonderfully in Word 2004, and not so much
in Word 2011.

I have a tiff file with my signature in it. I open it in Adobe
Photoshop CS2 (which still works fine for me). I then copy the just
the signature with the Magic Wand tool, so that there is no background
behind the signature.

I then paste the signature into a Word document, which receives it as
a picture. I then go to the Format menu, click on Picture, and then
when the Format Picture panel pops up, I click the Layout button, and
for wrapping style I click the In Front of Text button. I then click
OK.

From that point on Word 2004, I can move my signature to any point in
the document, and the text behind the signature will show through the
spaces and loops in my signature. I can save, close and reopen the
document, and everything works fine.

In Word 2011, the above-described process works most of the time.
However, when I save, close and reopen the document, the signature
"picture" no longer has a transparent background. It has a white,
rectangular background, with any text behind it being blocked out
completely.

Any suggestions?

Thanks.