SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2015

The estimated useful lives for buildings, furniture, vehicles, and equipment are as follows:

The following are the estimated useful life for the intangible assets:

		Estimated
Finite-lived Intangible Assets		Useful Life
Order backlog - Orbital		2
Trade name - Orbital		10
Trade name - CUI - Canada		3
Trade name - V-Infinity		5
Customer list - Orbital		10
Customer list - CUI Canada		7
Technology rights		20*
Technology - Based Asset - Know How		12
Technology - Based Asset - Software		10
Technology - Based Asset - Power		7
Patents		**
Software		3 to 5***
Other intangible assets		****

Indefinite-lived Intangible Assets
Trade name - CUI		*****
Customer list - CUI		*****
Patents pending technology		*****

* Technology rights are amortized over a twenty year life or the term of the rights agreement.

** Patents are amortized over the life of the patent. Any patents not approved will be expensed at that time.

*** Software assets are recorded at cost and include major expenditures, which increase productivity or substantially increase useful lives.

**** Other intangible assets are amortized over their estimated useful life.

***** Indefinite-lived intangible assets are reviewed annually for impairment and when circumstances suggest.

A summary of the financial statements of the affiliate as of and for the six months ended June 30, 2015 is as follows:

Current assets	$	6,248,974
Non-current assets		556,229
Total Assets	$	6,805,203

Current liabilities	$	1,707,654
Non-current liabilities		685,588
Stockholders' equity		4,411,961
Total Liabilities and Stockholders' Equity	$	6,805,203

Revenues	$	6,734,119
Operating income		241,831
Net profit		278,995
Other comprehensive profit (loss):
Foreign currency translation adjustment		-
Comprehensive net profit	$	278,995
Company share of Net Profit	$	23,715
Equity investment in affiliate	$	356,144

The following information represents segment activity for the six months ended June 30, 2015:

	Power and Electro- Mechanical		Gas		Other		Totals
Revenues from external customers	$	27,337,458	$	12,487,859	$	-	$	39,825,317
Depreciation and amortization		599,525		1,152,578		1,688		1,753,791
Earnings from equity investment		23,715		-		-		23,715
Interest expense		111,068		3,539		94,682		209,289
Income (loss) from operations		632,152		(3,198,234)		(2,226,815)		(4,792,897)
Segment assets		51,417,594		35,802,189		6,101,916		93,321,699
Intangible assets		9,423,025		10,358,500		6,375		19,787,900
Goodwill		13,082,361		8,972,018		-		22,054,379
*Expenditures for segment assets		434,869		2,104,221		-		2,539,090

The following information represents segment activity for the three months ended June 30, 2015:

	Power and Electro- Mechanical		Gas		Other		Totals
Revenues from external customers	$	16,648,012	$	6,324,185	$	-	$	22,972,197
Depreciation and amortization		333,424		367,001		844		701,269
Earnings from equity investment		10,014		-		-		10,014
Interest expense		56,598		1,750		38,018		96,366
Income (loss) from operations		1,162,904		(1,012,802)		(965,091)		(814,989)
Segment assets		51,417,594		35,802,189		6,101,916		93,321,699
Intangible assets		9,423,025		10,358,500		6,375		19,787,900
Goodwill		13,082,361		8,972,018		-		22,054,379
*Expenditures for segment assets		103,961		1,383,354		-		1,487,315

The following information represents segment activity for the six months ended June 30, 2014:

	Power and Electro- Mechanical		Gas		Other		Totals
Revenue from external customers	$	24,405,201	$	11,708,901	$	-	$	36,114,102
Depreciation and amortization		487,536		1,766,827		1,688		2,256,051
Earnings from equity investment		42,110		-		-		42,110
Interest expense		115,402		5,280		132,592		253,274
Income (loss) from operations		2,557,877		(908,725)		(2,283,877)		(634,725)
Segment assets		44,606,077		40,824,559		14,930,091		100,360,727
Intangible assets		8,264,018		14,021,007		9,750		22,294,775
Goodwill		13,041,280		9,720,399		-		22,761,679
Expenditures from segment assets		334,827		148,435		-		483,262

The following information represents segment activity for the three months ended June 30, 2014:

	Power and Electro- Mechanical		Gas		Other		Totals
Revenue from external customers	$	13,574,894	$	5,639,299	$	-	$	19,214,193
Depreciation and amortization		244,794		891,970		844		1,137,608
Earnings from equity investment		26,740		-		-		26,740
Interest expense		57,892		3,595		66,296		127,783
Income (loss) from operations		1,519,487		(624,837)		(1,117,032)		(222,382)
Segment assets		44,606,077		40,824,559		14,930,091		100,360,727
Intangible assets		8,264,018		14,021,007		9,750		22,294,775
Goodwill		13,041,280		9,720,399		-		22,761,679
Expenditures from segment assets		65,329		61,510		-		126,839

* Excludes amounts for acquisition.

The following represents revenue by country for the six months ended June 30, 2015 and 2014:

The following represents revenue by country for the three months ended June 30, 2015 and 2014: