INTANGIBLE ASSETS, GOODWILL AND LONG-LIVED ASSETS

12 Months Ended

Jul. 31, 2016

INTANGIBLE ASSETS, GOODWILL AND LONG-LIVED ASSETS

7. INTANGIBLE ASSETS, GOODWILL AND LONG-LIVED ASSETS

The components of amortizable intangible assets are as follows:


		July 31, 2016				July 31, 2015
	Weighted-Average Years Remaining Life in Years	Cost		Accumulated Amortization		Cost		Accumulated Amortization
Dealer networks/customer relationships	16	$	404,960	$	55,191	$	143,860	$	37,194
Trademarks	19		148,117		10,539		55,282		7,608
Design technology and other intangibles	9		22,400		10,870		22,400		8,168
Non-compete agreements	3		450		203		4,710		4,264
Backlog	0.2		12,400		4,133		–		–

Total amortizable intangible assets		$	588,327	$	80,936	$	226,252	$	57,234

Aggregate amortization expense for amortizable intangibles for all operations for the fiscal years ended July 31, 2016, 2015 and 2014 was $27,962, $16,015 and $12,984, respectively, including $27,962, $16,015 and $12,920, respectively, for continuing operations. The dealer networks and customer relationships are being amortized on an accelerated basis. Trademarks, design technology and other intangibles and non-compete agreements are amortized on a straight-line basis. The increase in amortizable intangible assets in fiscal 2016 is due to the acquisition of Jayco as more fully described in Note 2 to the Consolidated Financial Statements.

Estimated Amortization Expense:


For the fiscal year ending July 31, 2017	$	63,925
For the fiscal year ending July 31, 2018		54,463
For the fiscal year ending July 31, 2019		50,367
For the fiscal year ending July 31, 2020		46,480
For the fiscal year ending July 31, 2021		43,131
For the fiscal year ending July 31, 2022 and thereafter		249,025

	$	507,391

During the second quarter of fiscal 2016, the Company determined that sufficient evidence existed to warrant an interim goodwill impairment analysis for one of its reporting units. As a result of this analysis, the Company recorded a pre-tax, non-cash goodwill impairment charge of $9,113 in the second quarter of fiscal 2016 related to this reporting unit within the towables reportable segment. For the purpose of this goodwill test, the fair value of the reporting unit was determined by employing a discounted cash flow model, which utilized Level 3 inputs as defined by ASC 820. The $9,113 charge represents the full impairment of the goodwill related to this reporting unit.

Goodwill is not subject to amortization, but instead is reviewed for impairment by applying a fair-value based test to the Company’s reporting units on an annual basis as of April 30, or more frequently if events or circumstances indicate a potential impairment. The Company’s reporting units are generally the same as its operating segments, which are identified in Note 4 to the Condensed Consolidated Financial Statements. Fair values are determined by a discounted cash flow model. These estimates are subject to significant management judgment, including the determination of many factors such as sales growth rates, gross margin patterns, cost growth rates, terminal value assumptions and discount rates, and therefore largely represent Level 3 inputs as defined by ASC 820. Changes in these estimates can have a significant impact on the determination of cash flows and fair value and could potentially result in future material impairments.

Management engages an independent valuation firm to assist in its impairment assessments. The Company completed its annual impairment review as of April 30, 2016 and no additional impairment of goodwill was identified, other than the second quarter of fiscal 2016 impairment described above.

Changes in the carrying amount of goodwill by reportable segment as of July 31, 2016 and 2015 are summarized as follows:


	Towables			Motorized			Other		Total
Net balance as of July 31, 2014	$	256,579		$	–		$	–	$	256,579

Fiscal year 15 activity:
Goodwill acquired		13,172			–			42,871		56,043

Net balance as of July 31, 2015		269,751			–			42,871		312,622
Fiscal year 16 activity:
Goodwill acquired		74,184			–			–		74,184
Impairment charges		(9,113	)		–			–		(9,113	)

Net balance as of July 31, 2016	$	334,822		$	–		$	42,871	$	377,693


The components of the net balance as of July 31, 2016 are summarized as follows:

	Towables			Motorized			Other		Total
Goodwill	$	343,935		$	17,252		$	42,871	$	404,058
Accumulated impairment charges		(9,113	)		(17,252	)		–		(26,365	)

Net balance as of July 31, 2016:	$	334,822		$	–		$	42,871	$	377,693

- 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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