Selected Balance Sheet Accounts

6 Months Ended

Jun. 30, 2011

Selected Balance Sheet Accounts [Abstract]

Selected Balance Sheet Accounts [Text Block]

6. Selected Balance Sheet Accounts

Property and Equipment.  Property and equipment consists of the following:

	June 30,			December 31,
	2011			2010
	(in thousands)
Computer software and hardware and capitalized internal use software	$	12,254		$	11,651
Furniture and equipment		1,505			1,505
Leasehold improvements		1,024			1,024
		14,783			14,180
Less - Accumulated depreciation and amortization		(12,842	)		(12,447	)
Property and equipment, net	$	1,941		$	1,733

 The Company periodically reviews long-lived assets to determine if there are any impairment indicators.  The Company assesses the impairment of these assets, or the need to accelerate amortization, whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company's judgments regarding the existence of impairment indicators are based on legal factors, market conditions and operational performance of our long-lived assets.  If such indicators exist, the Company evaluates the assets for impairment based on the estimated future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. Should the carrying amount of an asset exceed its estimated future undiscounted cash flows, an impairment loss is recorded for the excess of the asset's carrying amount over its fair value. Fair value is generally determined based on a valuation process that provides an estimate of a fair value of these assets using a discounted cash flow model, which includes assumptions and estimates.

Concentration of Credit Risk and Risks Due to Significant Customers.  Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. Cash and cash equivalents are primarily maintained with three financial institutions in the United States. Deposits held by banks exceed the amount of insurance provided for such deposits. These deposits may be redeemed upon demand. Accounts receivable are primarily derived from fees billed to automotive dealers and automotive manufacturers.  The Company generally requires no collateral to support its accounts receivables and maintains an allowance for bad debts for potential credit losses.

The Company has a concentration of credit risk with its automotive industry related accounts receivable balances, and in particular with two Manufacturers (General Motors and Nissan). During the first six months of 2011, approximately 12% of the Company's total revenues were derived from General Motors and Nissan, and approximately 15% or $1.5 million of gross accounts receivable related to these Manufacturers at June 30, 2011.

 Investments.  On August 16, 2010, the Company acquired less than a 5% interest in Driverside, Inc. for $1,000,000.  The Company made an additional investment in Driverside, Inc. in the three months ended June 30, 2011 for $16,737.  The Company recorded the investments in Driverside, Inc. at cost because the Company does not have significant influence over Driverside, Inc.  The Company reviews for indicators of impairment on a quarterly basis by evaluating whether an event or change in circumstance has occurred that may have a significant adverse effect on the value of the investment.  As of June 30, 2011, there were no changes in the recognized amount of the investment in Driverside, Inc.

Intangible Assets.  The Company amortizes specifically identified intangible assets using the straight-line method over the estimated useful lives of the assets.

In connection with the acquisition of Auto/Cyber on September 17, 2010, the Company identified $4.5 million of intangible assets.  The intangible assets will be amortized over the following estimated useful lives:

Intangible Asset	Estimated Useful Life
Trademarks/trade names	5 years
Software and publications	3 years
Customer relationships	3 years
Employment/non-compete agreements	5 years

Amortization expense for the remainder of the year and for the next five years is as follows:

Year	Amortization Expense
	(in thousands)
2011	$	689
2012		1,356
2013		1,037
2014		286
2015		209
	$	3,577

Goodwill.  The Company recognized $11.7 in goodwill related to the acquisition of Auto/Cyber in the quarter ended September 30, 2010.  Goodwill represents the excess of the purchase price over the fair value of net assets acquired.  Goodwill is not amortized and is assessed annually for impairment or whenever events or circumstances indicate that the carrying value of such assets may not be recoverable.

Accrued Expenses and Other Current Liabilities.  Accrued expenses and other current liabilities consisted of the following:

	June 30,		December 31,
	2011		2010
	(in thousands)
Compensation and related costs	$	1,349	$	1,988
Professional fees and other accrued expenses		1,244		2,103
Amounts due to customers		391		367
Other current liabilities		585		537
Total accrued expenses and other current liabilities	$	3,569	$	4,995

Long-term debt.  In connection with the acquisition of Auto/Cyber, the Company issued the Note described in Footnote 3.

In the event of default, the entire unpaid balance of the Note will become immediately due and payable and will bear interest at the lower of 8% per year and the highest legal rate permissible under applicable law.