Goodwill And Other Intangible Assets

12 Months Ended

Sep. 30, 2014

Goodwill And Other Intangible Assets [Abstract]

8.Goodwill and Other Intangible Assets

Changes in the carrying amount of goodwill, by reportable segment, for the years ended September 30, 2014 and 2013 were as follows:



(Dollars in Thousands)	Radiation Measurement		Medical Physics		Medical Products		Total
Balance as of September 30, 2012	$	20,037	$	22,611	$	64,069	$	106,717
Effects of foreign currency		419		-		-		419
Goodwill impairment charges		-		-		(22,700)		(22,700)
Balance as of September 30, 2013	$	20,456	$	22,611	$	41,369	$	84,436
Increase related to acquisitions		-				1,775		1,775
Effects of foreign currency		(1,495)		-		(130)		(1,625)
Accumulated goodwill impairment charges		-		-		(41,368)		(41,368)
Goodwill net, as of September 30, 2014	$	18,961	$	22,611	$	1,646	$	43,218

Goodwill and certain intangible assets with indefinite lives are reviewed annually for impairment and more frequently if an event occurs or circumstances change that would require the Company to perform an interim review. The Company has three segments, Radiation Measurement, Medical Physics and Medical Products. The Company aggregates its business components into reporting units to test for goodwill impairment. The Radiation Measurement and Medical Physics segments are comprised of one reporting unit each. The Medical Products segment is comprised of two reporting units – IZI Medical Products and ilumark.

The Company completed a qualitative goodwill impairment assessment of the Radiation Measurement reporting unit as of September 30, 2014 to determine if it was more likely or not more likely that the fair value of this reporting unit was less than its carrying value. The estimated fair value of the Radiation Measurement reporting unit substantially exceeded its carrying value at September 30, 2014. Due to this substantial margin, as well as the Company’s belief that there has been no adverse event or change in circumstances affecting the fair value of this reporting unit, the Company determined that a qualitative analysis was appropriate. The Company has reviewed events and circumstance that may impact the Radiation Measurement reporting unit’s specific operating and financial position or performance as well as the economic and industry environment in which it operates. In addition, through a series of sensitivity analyses, the Company determined the circumstances by which the fair value of this reporting unit would fall below its carrying value. Based on the qualitative analysis, the Company believes there have been no triggering events that would suggest that the fair value of the Radiation Measurement reporting unit is below its carrying value.

The Company completed a quantitative assessment for the Medical Physics reporting unit as of September 30, 2014, and the estimated fair value of this reporting unit significantly exceeded its carrying value. The discount rate used in this valuation was 12%.

During the third quarter of fiscal 2014, it became apparent that anticipated revenue and profitability trends in our IZI Medical Products reporting unit were not being achieved to the extent forecasted. Early budget reviews also indicated future sales growth and margins may be less than expected. The Company updated the forecast for the Medical Products segment based on the most recent financial results and best estimates of future operations. The updated forecast reflected slower growth in revenues and lower margins for the Medical Products segment primarily due to anticipated continued competitive pricing pressure. As a result, for the quarter ended June 30, 2014, the Company performed an impairment analysis with respect to the carrying value of the intangible assets and goodwill in the IZI Medical Products reporting unit. In accordance with FASB ASC 360-10, Impairment and Disposal of Long-Lived Assets, the Company evaluated the recoverability of the intangible assets related to customer lists, tradenames and patents. Based on the testing performed, the Company recorded a non-cash impairment charge of $62,188, of which $41,368 related to goodwill and $20,820 related to intangible assets. The tax benefit associated with the goodwill impairment charge was $15,306, and the tax benefit associated with the intangible assets charge was $7,703.

In accordance with FASB ASC 360-10, Impairment and Disposal of Long-Lived Assets, the Company evaluated the recoverability of its long-lived assets in the IZI Medical Products reporting unit. Based upon this evaluation, the Company determined that its intangible assets related to customer lists, tradenames and patents were impaired. As a result, the Company recognized a non-cash pre-tax intangible asset impairment charge of $20,820. The tax benefit associated with this charge was $7,703.

The impairment charges are non-cash in nature and do not affect the Company’s liquidity. The impairment charge in the IZI Medical Products reporting unit and the effects of foreign currency in the Radiation Measurement segment reduced the carrying amount of goodwill to $43,218 as of September 30, 2014 from $84,436 as of September 30, 2013.

During the third quarter of fiscal 2013, the Company performed an impairment analysis with respect to the carrying value of the goodwill in the IZI Medical Products reporting unit. Based on the testing performed, the Company recorded a non-cash goodwill impairment charge of $22,700. The tax benefit associated with this charge was $8,456.

Intangible assets for the years ended September 30 were as follows:



	2014
(Dollars in Thousands)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Intangibles Impairment Charge
Customer lists	$	44,138	$	32,934	$	11,204	$	18,657
Trademarks and tradenames		2,176		2,051		125		1,498
Licenses and patents		4,765		2,037		2,728		665
Other intangibles		577		557		20		-
Intangible assets	$	51,656	$	37,579	$	14,077	$	20,820



	2013
(Dollars in Thousands)	Gross Carrying Amount		Accumulated Amortization (As Restated)		Net Carrying Amount
Customer lists	$	43,954	$	11,789		32,165
Trademarks and tradenames		2,154		400		1,754
Licenses and patents		4,080		1,008		3,072
Other intangibles		577		557		20
Intangible assets	$	50,765	$	13,754	$	37,011

The Company assumed customer lists relating to business combinations of $711 and $2,485 during fiscal 2014 and 2013, respectively. No tradenames were assumed during fiscal 2014 and 2013 relating to business combinations. Amortization of intangible assets was $3,978, $4,095 and $3,270 for the years ended September 30, 2014, 2013 and 2012, respectively. Annual aggregate amortization expense related to intangible assets is estimated to be approximately $1,779 in fiscal 2015 through 2017, $1,654 in fiscal 2018 and $1,139 in fiscal 2019.

- 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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