Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

In April 2017, the Company acquired substantially all of the assets and business of Nesscap. As of September 30, 2017, the purchase price allocation for the Nesscap Acquisition remains preliminary.

The change in the carrying amount of goodwill from December 31, 2016 to September 30, 2017 was as follows (in thousands):



Balance as of December 31, 2016	$	22,799
Goodwill from Nesscap Acquisition	11,624
Foreign currency translation adjustments	765
Balance as of September 30, 2017	$	35,188

The composition of intangible assets subject to amortization was as follows (in thousands):



	As of September 30, 2017
	Useful Life (in years)	Gross Initial Carrying Value		Cumulative Foreign Currency Translation Adjustment			Accumulated Amortization			Net Carrying Value
Customer relationships - institutional	14	$	3,200	$	(44	)	$	(96	)	$	3,060
Customer relationships - non-institutional	10	4,400		(60		)	(187		)	4,153
Trademarks and trade names	10	1,500		(20		)	(64		)	1,416
Developed technology	8	2,700		(37		)	(145		)	2,518
Total intangible assets		$	11,800	$	(161	)	$	(492	)	$	11,147

The useful life of intangible assets reflects the period the assets are expected to contribute directly or indirectly to future cash flows. Intangible assets are amortized over the useful lives of the assets utilizing the straight-line method, which is materially consistent with the pattern in which the expected benefits will be consumed, calculated using undiscounted cash flows.

For the three months ended September 30, 2017, amortization expense of $88,000 was recorded to “cost of revenue” and $0.2 million was recorded to “selling, general and administrative.” For the nine months ended September 30, 2017, amortization expense of $148,000 was recorded to “cost of revenue” and $0.4 million was recorded to “selling, general and administrative.” Estimated amortization expense for the remainder of 2017 is $0.3 million. Estimated amortization expense for the years 2018 through 2021 is $1.2 million each year. The expected amortization expense is an estimate and actual amounts could differ due to additional intangible asset acquisitions, changes in foreign currency rates or impairment of intangible assets.

- 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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