Goodwill

We test goodwill for impairment annually during our first fiscal quarter, referred to as the annual test date. We will also test for impairment between annual test dates if an event occurs or circumstances change that would indicate the carrying amount may be impaired. Impairment testing for goodwill is performed at a reporting-unit level, which is defined as an operating segment or one level below an operating segment (referred to as a component). A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component.

The authoritative guidance on the evaluation of goodwill for potential impairment permits a company the option of performing a qualitative assessment to determine whether further impairment testing is necessary. During the first quarter of fiscal 2016, considering the recent quantitative assessment performed as of the first quarter of fiscal 2015 and lack of any events and circumstances that would indicate a significant change to the conclusion of such assessment, we elected to perform a qualitative assessment to determine whether further impairment testing is warranted. The qualitative assessment included consideration of factors such as the margin of fair values of the reporting units as of the most recent quantitative impairment assessment as compared to the relative carrying value of net assets for each reporting unit and the potential adverse changes in fair value to the reporting units since the most recent quantitative impairment assessment by considering changes in macroeconomic variables, changes in the industry in which the Company operates, and relevant company- and reporting unit-specific factors. The qualitative assessment indicated that it is more likely than not that the fair value of all reporting units with goodwill exceeded its respective net carrying values and, therefore, additional impairment testing was not deemed necessary.

We do not amortize goodwill as it has been determined to have an indefinite useful life.

Goodwill by reporting unit consists of the following:



	March 31, 2015		June 30, 2015
NextGen Division	$	33,992	$	33,992
RCM Services Division	32,290		32,290
QSI Dental Division (1)	7,289		7,289
Total goodwill	$	73,571	$	73,571

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(1) QSI Dental Division goodwill is presented on a basis consistent with that of our management reporting structures. However, for the purposes of assessing goodwill for impairment annually and as otherwise may be required, the QSI Dental Division goodwill is allocated to the reporting units that derive cash flows from the products associated with the acquired goodwill. For all periods presented in this report, the allocation resulted in substantially all of the QSI Dental Division goodwill being ascribed to the NextGen Division.