GOODWILL AND OTHER INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2014

8. GOODWILL AND OTHER INTANGIBLE ASSETS

The following table presents the changes in the carrying amount of goodwill:


(in thousands)	2014

Balance as of January 1,	$	37,463

Purchase price adjustments to goodwill retroactively applied (1)		2,866

Goodwill acquired		134


Balance as of June 30,	$	40,463

(1) The purchase price adjustments identified during the first six months of 2014 have been retroactively applied as of December 31, 2013.

Intangible assets are recorded at cost and are amortized using the straight-line method over their estimated useful lives.


(in thousands)	Range of Useful Lives		Cost		Accumulated Amortization		Net Book Value
As of June 30, 2014

Customer related intangibles		4-9 years	$	48,634	$	(21,311)	$	27,323

Technology		3-9 years		47,616		(26,189)		21,427

Other intangibles		1-5 years		4,810		(3,500)		1,310

Total			$	101,060	$	(51,000)	$	50,060

			Cost		Accumulated Amortization		Net Book Value
As of December 31, 2013

Customer related intangibles		4-9 years	$	48,634	$	(18,317)	$	30,317

Technology		3-9 years		47,102		(22,873)		24,229

Other intangibles		1-5 years		4,658		(2,630)		2,028

Total			$	100,394	$	(43,820)	$	56,574

Amortization of intangibles was reflected in the Company’s unaudited condensed consolidated statements of operations as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands)	2014		2013		2014		2013
Cost of revenue	$	1,444	$	1,541	$	3,284	$	3,082

Selling and marketing		1,499		1,232		2,995		2,464

General and administrative		481		—		901		4

Total amortization expense	$	3,424	$	2,773	$	7,180	$	5,550

Amortization of intangibles is estimated to be recorded over their remaining useful lives as follows:


(in thousands) as of June 30, 2014	Future estimated amortization expense
Remainder of 2014	$	6,209

2015		11,557

2016		11,145

2017		9,564

2018		8,688

2019		2,897

	$	50,060

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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