Note 7 - Goodwill

3 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Goodwill Disclosure [Text Block]

7.

   Goodwill

The changes in the carrying amount of goodwill for the periods ended

March 31, 2020,

and

2019

were as follows:

	March 31, 2020		December 31, 2019
Goodwill, balance at beginning of period	$	3,301,439	$	-
Acquisition of Kidoz Ltd. (Note 3)		-		17,178,824
Impairment of goodwill		-		(13,877,385	)
Goodwill, balance at end of period	$	3,301,439	$	3,301,439

The Company's annual goodwill impairment analysis performed during the

fourth

quarter of fiscal

2019

included a quantitative analysis of Kidoz Ltd. reporting unit. The Company classified these fair value measurements as Level

3.

The Company performed a discounted cash flow analysis and market multiple analysis for Kidoz Ltd. These discounted cash flow models included management assumptions for expected sales growth, margin expansion, operational leverage, capital expenditures, and overall operational forecasts. The market multiple analysis included historical and projected performance, market capitalization, volatility, and multiples for industry peers and exogenous current market conditions. These analyses led to the conclusion that the fair value of these reporting units was less than their carrying values by an amount that exceeded the carrying value of goodwill. Accordingly, during the year ended

December 31, 2019,

the Company recognized impairment of

$13,877,385

to the carrying value of the goodwill.