GOODWILL AND INTANGIBLE ASSETS

12 Months Ended

Dec. 31, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS - NET

Goodwill by reportable segment was as follows:



	North America			Europe			Russia			Total
Balance as of January 1, 2013	$	16,643		$	2,864		$	3,191		$	22,698
Net effect of foreign currency exchange rate changes	(205		)	—			(225		)	(430		)
Balance as of December 31, 2013	16,438			2,864			2,966			22,268
Acquisition of Netsoft (Note 2)	2,749			—			—			2,749
Acquisition of Jointech (Note 2)	—			17,404			—			17,404
Acquisition of GGA (Note 2)	12,115			—			—			12,115
Acquisition of Great Fridays (Note 2)	—			6,947			—			6,947
Goodwill written-off	—			—			(2,241		)	(2,241		)
Net effect of foreign currency exchange rate changes	(224		)	(876		)	(725		)	(1,825		)
Balance as of December 31, 2014	$	31,078		$	26,339		$	—		$	57,417

Excluded from the table above is the Other segment. As a result of an operating loss in the Other reporting unit for the three months ended June 30, 2011, the Company performed a goodwill impairment test. In assessing impairment in accordance with Accounting Standards Codification, (“ASC”) No. 350, “Intangibles-Goodwill and Other,” the Company determined that the fair value of the Other reporting unit, based on the total of the expected future discounted cash flows directly related to the reporting unit, was below the carrying value of the reporting unit. The Company completed the second step of the goodwill impairment test, resulting in an impairment charge of $1,697 in the Other operating segment. As of December 31, 2014, 2013 and 2012 the book value of the Other segment was $0.

The Company performed an annual goodwill impairment test as of October 31, 2014 in accordance with Accounting Standards Codification, (“ASC”) No. 350, “Intangibles-Goodwill and Other.” In assessing impairment both qualitatively and quantitatively based on the total of the expected future discounted cash flows directly related to the reporting unit, the Company determined that the fair value of the Russia reporting unit was below the carrying value of the reporting unit. The Company completed the second step of the goodwill impairment test, resulting in an impairment charge of $2,241 as of December 31, 2014. All existing assets that related to the Russia segment, excluding goodwill and including any unrecognized intangible assets, were assessed by management and deemed to not be impaired.

There were no accumulated impairments losses in North America or Europe operating segments as of December 31, 2014, 2013 or 2012.

As part of the Netsoft acquisition, substantially all of the employees of Netsoft accepted employment with the Company. The Company believes the amount of goodwill resulting from the allocation of purchase price to acquire Netsoft is attributable to the workforce of the acquired business. All of the goodwill was allocated to the Company’s U.S. operations and is presented within North America.

As part of the Jointech acquisition, substantially all of the employees of Jointech continued employment. The Company believes the amount of goodwill resulting from the allocation of purchase price to acquire Jointech is attributable to the workforce of the acquired business. Based on the determination of the reportable units, Jointech has been placed in the Europe reportable unit based on managerial responsibility and consistent with segment reporting. All of the goodwill was allocated to the Company’s UK operations and is presented within Europe segment.

As part of the GGA acquisition, substantially all of the employees of GGA accepted employment with the Company. The Company believes the amount of goodwill resulting from the allocation of purchase price to acquire GGA is attributable to the workforce of the acquired business. All of the goodwill was allocated to the Company’s U.S. operations and is presented within North America.

As part of the Great Fridays acquisition, substantially all of the employees of Great Fridays continued employment. The Company believes the amount of goodwill resulting from the allocation of purchase price to acquire Great Fridays is attributable to the workforce of the acquired business. All of the goodwill was allocated to the Company’s U.S. operations and is presented within North America.



	2014
	Weighted average life at acquisition (in years)	Gross carrying amount		Accumulated amortization			Net carrying amount
Client relationships	10	$	48,482	$	(4,664	)	$	43,818
Trade name	5	6,372		(2,894		)	3,478
Non-competition agreements	5	813		(420		)	393
Total		$	55,667	$	(7,978	)	$	47,689



	2013
	Weighted average life at acquisition (in years)	Gross carrying amount		Accumulated amortization			Net carrying amount
Client relationships	9	$	13,432	$	(4,885	)	$	8,547
Trade name	5	6,232		(1,643		)	4,589
Non-competition agreements	5	848		(250		)	598
Total		$	20,512	$	(6,778	)	$	13,734



	2012
	Weighted average life at acquisition (in years)	Gross carrying amount		Accumulated amortization			Net carrying amount
Client relationships	9	$	13,724	$	(3,640	)	$	10,084
Trade name	5	6,372		(439		)	5,933
Non-competition agreements	5	881		(64		)	817
Total		$	20,977	$	(4,143	)	$	16,834

All of the intangible assets have finite lives and as such are subject to amortization. Recognized amortization expense for the years ended December 31 is presented in the table below:



	For the Years Ended December 31,
	2014		2013		2012
Client relationships	$	3,843	$	1,373	$	627
Trade name	1,319		1,222		333
Non-competition agreements	187		190		64
Total	$	5,349	$	2,785	$	1,024

Estimated amortization expenses of the Company’s existing intangible assets for the next five years ending December 31, were as follows:



	Amount
2015	$	6,520
2016	6,383
2017	5,957
2018	5,032
2019	4,748
Thereafter	19,049
Total	$	47,689

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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