Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS:

The changes in the carrying amount of goodwill are as follows:


	Classic Consulting		EPM		ERP		Consolidated
	(In Thousands)
Balance at January 1, 2016	$	140	$	13,730	$	16,040	$	29,910
Increase to goodwill in 2016 related to the M2 Dynamics Acquisition		—		73		—		73

Balance at December 31, 2016		140		13,803		16,040		29,983
Changes to goodwill in 2017		—		—		—		—

Balance at December 31, 2017	$	140	$	13,803	$	16,040	$	29,983

Cumulative goodwill impairment charges of $54.6 million (related to impairments recognized in 2002 and 2008 within the Classic Consulting operating segment) are reflected in the ending goodwill balance at December 31, 2017.

As of December 31, 2017, the net carrying amount of intangible assets consists of amounts related to business combination transactions consummated by the Company in 2015.

Other net intangibles amounted to $5.6 million and $8.4 million as of December 31, 2017 and 2016, respectively. Below is a summary of the Company’s identifiable intangible assets that are subject to amortization:



	December 31, 2017
	Gross Carrying Amount		Impairment Charges		Accumulated Amortization		Net Carrying Amount
	(In Thousands)
Identifiable intangibles:
Customer relationships		22,978		-		17,403		5,575
Capitalized product development costs		1,139		-		1,139		-

	$	24,117	$	-	$	18,542	$	5,575


	December 31, 2016
	Gross Carrying Amount		Impairment Charges		Accumulated Amortization		Net Carrying Amount
	(In Thousands)
Identifiable intangibles:
Customer relationships		22,978		-		14,611		8,367
Capitalized product development costs		1,139		-		1,128		11

	$	24,117	$	-	$	15,739	$	8,378

The intangible assets were identified and valued by the Company. The original estimated useful lives of the acquired identifiable intangible assets are as follows:


Customer relationships		4 to 6 years
Capitalized product development costs		3 years

Intangible assets are amortized assuming no expected residual value over the periods in which the economic benefit of these assets is consumed. Customer relationships are amortized on an accelerated method based on the proportional relationship of projected future discounted cash flows. The weighted average amortization period for all intangible assets subject to amortization was 3.4 years, 4.4 years and 5.4 years as of December 31, 2017, 2016 and 2015, respectively. Amortization expense related to all intangible assets was $2.8 million, $3.4 million and $899 thousand in 2017, 2016 and 2015, respectively.

Amortization of $7 thousand, $188 thousand and $191 thousand related to capitalized software development costs were included within cost of revenue (specifically within software expense) on the consolidated statements of comprehensive loss for the years ended December 31, 2017, 2016 and 2015, respectively.

Estimated annual amortization expense for the next five years ending December 31, which encompasses the remaining useful life of the intangible assets, is as follows:


	Amortization Expense
	(In Thousands)
2018		2,240
2019		1,712
2020		1,057
2021		566

Total	$	5,575

- 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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