Long-Lived Assets

9 Months Ended

Sep. 30, 2020

Goodwill And Intangible Assets Disclosure [Abstract]

Long-Lived Assets

3.  LONG-LIVED ASSETS

Goodwill. The changes in the carrying amount of goodwill for the nine months ended September 30, 2020 were as follows (in thousands):

January 1, 2020 balance	$	259,164
Tekzenit, Inc. acquisition		9,083
Adjustments related to prior acquisitions		(45	)
Effects of changes in foreign currency exchange rates		(1,566	)
September 30, 2020 balance	$	266,636

See Note 5 for discussion regarding the Tekzenit, Inc. acquisition.

Other Intangible Assets.  Our other intangible assets subject to ongoing amortization consist primarily of acquired client contracts and software.  As of September 30, 2020 and December 31, 2019, the carrying values of these assets were as follows (in thousands):

	September 30, 2020							December 31, 2019
	Gross							Gross
	Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Amount		Amortization			Amount		Amount		Amortization			Amount
Acquired client contracts	$	151,089	$	(100,864	)	$	50,225	$	148,872	$	(93,767	)	$	55,105
Software		164,413		(135,644	)		28,769		157,963		(125,437	)		32,526
Total intangible assets	$	315,502	$	(236,508	)	$	78,994	$	306,835	$	(219,204	)	$	87,631

The total amortization expense related to other intangible assets for the third quarters of 2020 and 2019 were $6.3 million and $5.9 million, respectively, and for the nine months ended September 30, 2020 and 2019 were $18.9 million and $17.3 million, respectively.  Based on the September 30, 2020 net carrying value of our other intangible assets, the estimated total amortization expense for each of the five succeeding fiscal years ending December 31 are: 2020 – $25.3 million; 2021 – $18.4 million; 2022 – $13.9 million; 2023 – $10.0 million; and 2024 – $6.7 million. 

Client Contract Costs.  As of September 30, 2020 and December 31, 2019, the carrying values of our client contract cost assets, related to those contracts with a contractual term greater than one year, were as follows (in thousands):

	September 30, 2020							December 31, 2019
	Gross							Gross
	Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Amount		Amortization			Amount		Amount		Amortization			Amount
Client contract costs	$	84,244	$	(39,206	)	$	45,038	$	82,272	$	(31,526	)	$	50,746

During the nine months ended September 30, 2020, we recorded an impairment charge of $10.3 million for the write-off of capitalized client contract costs related to a discontinued project implementation.  This non-cash impairment charge is included primarily in cost of revenue in our Condensed Consolidated Statements of Income (“Income Statement”).

The total amortization expense related to client contract costs for the third quarters of 2020 and 2019 were $4.2 million and $3.7 million, respectively, and for the nine months ended September 30, 2020 and 2019 were $12.8 million and $16.1 million, respectively.