Composition of Certain Financial Statement Items

9 Months Ended

Sep. 30, 2012

Composition Of Certain Financial Statements Items [Abstract]

Composition of Certain Financial Statements Items [Text Block]

Note 6 – Composition of Certain Financial Statement Items

Amounts receivable

The Company’s amounts receivable are primarily related to the operations of its subsidiaries Counsel RB, Equity Partners, and Heritage Global Partners. They consist of three major categories: receivables from Joint Venture partners, receivables from asset sales, and fees and retainers relating to the businesses of Equity Partners and Heritage Global Partners. To date, the Company has not experienced any significant collectability issues with respect to either the receivables from Joint Venture partners or the receivables from asset sales. Given this experience, together with the ongoing business relationships between the Company and its partners, the Company has not yet been required to develop a policy for formal credit quality assessment. The Equity Partners and Heritage Global Partners businesses have similarly not required formal credit quality assessments. As the Company’s asset liquidation business continues to develop, more comprehensive credit assessments may be required.

To date the Company has recorded only one interest-bearing note receivable, in the amount of $225. This note was acquired when Counsel RB commenced operations in the second quarter of 2009. An allowance of $146 was recorded in the fourth quarter of 2010, and a further allowance of $40 was recorded in the second quarter of 2011. The remaining balance of $39 was collected during the second quarter of 2012, and therefore at September 30, 2012, the Company had no interest-bearing notes receivable.

In the first quarter of 2011, the Company acquired a lease receivable in the amount of $248, which is being reduced by monthly payments of $12 that began in April 2011. The lease receivable began accruing interest beginning April 1, 2011.

At September 30, 2012 the Company had no investment in non-interest bearing financing receivables that are past due.

During the first nine months of 2012, there were no changes in the Company’s accounting policies for financing receivables, and therefore no related change in the current-period provision for credit losses. During the same period, there were no purchases, sales or reclassifications of financing receivables. There were no troubled debt restructurings during the first nine months of 2012.

Amounts receivable from third parties consisted of the following at September 30, 2012 and December 31, 2011:

	September 30, 2012		December 31, 2011
Accounts receivable (net of allowance for doubtful accounts of $0; 2011 - $0)	$	2,029	$	730
Notes receivable (net of allowance for doubtful accounts of $0; 2011 - $186)		—		39
Lease receivable		46		148
	$	2,075	$	917

Intangible assets

The Company’s intangible assets are related to its asset liquidation business.

As discussed in Note 3, on February 29, 2012 the Company acquired Heritage Global Partners for a total purchase price of $7,080, of which $5,640 was assigned to identifiable intangible assets. Of this amount, $4,180 was assigned to Customer/Broker Network and $1,460 was assigned to Trade Name. The Customer/Broker Network intangible asset is being amortized over 12 years, and the Trade Name intangible asset is being amortized over 14 years. The details are as shown below:

	September 30, 2012
Customer/Broker Network (net of amortization of $203)	$	3,977
Trade Name (net of amortization of $62)		1,398
	$	5,375

Goodwill

The Company’s goodwill is related to its asset liquidation business.

As part of its acquisition of Equity Partners in June 2011, the Company recognized goodwill of $573. No goodwill impairment resulted from the completion of the impairment tests at December 31, 2011, and there have been no events or changes in circumstances in 2012 that make it more likely than not that the carrying amount of this goodwill may be impaired.

As part of its acquisition of Heritage Global Partners in February 2012, the Company recognized goodwill of $4,728, as discussed in more detail in Note 3. Subsequent to the acquisition, there have been no events or changes in circumstances that make it more likely than not that the carrying amount of this goodwill may be impaired.

Accounts payable and accrued liabilities

Accounts payable and accrued liabilities consisted of the following at September 30, 2012 and December 31, 2011:

	September 30, 2012		December 31, 2011
Due to Heritage Global Partners clients	$	7,646	$	—
Due to Joint Venture partners		342		89
Sales and other taxes		504		66
Remuneration and benefits		214		402
Asset liquidation expenses		74		—
Regulatory and legal fees		242		49
Accounting, auditing and tax consulting		127		169
Patent licensing and maintenance		7		8
Other		299		72
Total accounts payable and accrued liabilities	$	9,455	$	855