Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill and Intangible Assets

Goodwill represents the excess purchase price over the fair value of net assets acquired, or net liabilities assumed, in a business combination. In accordance with ASC Topic 350, Intangibles – Goodwill and Other, the Company performs an annual impairment review in the fourth quarter and more frequently if events or changes in circumstances indicate that goodwill might be impaired. There was no indication that goodwill became impaired for the year ended December 31, 2022.

Other intangible assets include customer relationships, non-compete arrangements, trade names, customer backlog, and developed software, which are being amortized over the assets’ estimated useful lives using the straight-line method. Estimated useful lives range from less than one year to ten years. Amortization of customer relationships, non-compete arrangements, trade names, customer backlog, and developed software is considered an operating expense and is included in Amortization in the accompanying Consolidated Statements of Operations. The Company periodically reviews the estimated useful lives of its identifiable intangible assets, taking into consideration any events or circumstances that might result in a lack of recoverability or revised useful life. There was no indication that other intangible assets became impaired for the year ended December 31, 2022.

Goodwill

Activity related to goodwill consisted of the following (in millions):

	Year Ended December 31,
	2022		2021
Balance, beginning of year	$	515.2	$	427.9
Purchase price allocations and measurement period adjustments for acquisitions	60.8		96.7
Effect of foreign currency translation adjustments	(10.8)		(9.4)
Balance, end of year	$	565.2	$	515.2

Intangible Assets with Definite Lives

Following is a summary of the Company’s intangible assets that are subject to amortization (in thousands):

	Year Ended December 31,
	2022						2021
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Customer relationships	$	151,926	$	(68,434)	$	83,492	$	125,433	$	(51,253)	$	74,180
Non-compete agreements	1,719		(986)		733		1,444		(736)		708
Customer backlog	2,661		(734)		1,927		3,025		(741)		2,284
Trade name	941		(692)		249		683		(155)		528
Developed software	7,754		(5,218)		2,536		6,982		(3,405)		3,577
Total	$	165,001	$	(76,064)	$	88,937	$	137,567	$	(56,290)	$	81,277

The estimated useful lives of identifiable intangible assets are as follows:

Customer relationships	5 - 10 years
Non-compete agreements	4 - 5 years
Customer backlog	1 year
Trade name	1 year
Developed software	1 - 7 years

Total amortization expense for the years ended December 31, 2022, 2021 and 2020 was $24.5 million, $23.5 million and $22.9 million, respectively.

Estimated annual amortization expense for the next five years ended December 31 and thereafter is as follows (in thousands):

2023	$	19,826
2024	$	14,479
2025	$	11,554
2026	$	9,522
2027	$	7,277
Thereafter	$	26,279