Note 8. Assets Manufactured for Internal Use

The components of assets manufactured for internal use, included in amounts reported as other assets, are as follows:

	December 31,

	2013			2012
	(in thousands)
Internal use assets	$	23,409		$	21,904
Construction in progress		5,263			1,823


Total cost		28,672			23,727
Accumulated depreciation		(15,774	)		(13,948	)


Assets manufactured for internal use	$	12,898		$	9,779

These products are used in-house for research and development, training, and customer demonstration purposes.

Effective October 1, 2013, the Company changed its estimate of the useful life of its assets manufactured for internal use (which are amortized on a straight-line basis) from five years to ten years. This change in estimate resulted from the evaluation of the life cycle of our assets manufactured for internal use and the conclusion, that based on recent experience these products consistently have a longer life than previously estimated. The change in useful life has been accounted for as a change in accounting estimate, and will be effective on new assets manufactured for internal use, on a prospective basis beginning October 1, 2013.

As a result of the change in the estimated life of assets manufactured for internal use, profit before tax and net profit were approximately $0.1 million higher, for both the fourth quarter and the full year ended December 31, 2013. The change in estimated useful life of assets did not have an impact on the earnings per share disclosed in the Consolidated Statements of Operations.

Depreciation expense was $1.8 million, $3.4 million, and $4.9 million, for the years ended December 31, 2013, 2012, and 2011, respectively.