Composition of Certain Financial Statement Captions

12 Months Ended

Dec. 31, 2012

Composition of Certain Financial Statement Captions [Abstract]

Composition of Certain Financial Statement Captions [Text Block]

Note 6 – Composition of Certain Financial Statement Captions

Amounts receivable

As described in Note 3, the Company’s amounts receivable are primarily related to the operations of its subsidiaries Counsel RB, Equity Partners, and Heritage Global Partners. To date, the Company has not experienced any significant collectability issues with any of its receivables. Given this experience, together with the ongoing business relationships between the Company and its joint venture 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.

At December 31, 2012, the Company had one interest-bearing receivable in the amount of $10, which was an employee advance bearing interest at 10%. To date the Company has recorded only one other interest-bearing note receivable, which was a note in the amount of $225, 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.

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 December 31, 2012 the Company had a $9 non-interest bearing financing receivable that was past due. The Company expects to collect the full amount and therefore has not recorded an allowance for any part of this amount.

During the year ended December 31, 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 year ended December 31, 2012.

Amounts receivable consisted of the following at December 31, 2012 and 2011:

	December 31, 2012		December 31, 2011
Accounts receivable (net of allowance for doubtful accounts of $0; 2011 - $0)	$	1,046	$	730
Notes receivable (net of allowance for doubtful accounts of $0; 2011 - $186)		10		39
Lease receivable		12		148
	$	1,068	$	917

Intangible assets

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

As discussed in Note 2, 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. Based on the Company’s assessment at December 31, 2012, these assets were not impaired. The details are as shown below:

	December 31, 2012
Customer/Broker Network (net of amortization of $290)	$	3,890
Trade Name (net of amortization of $87)		1,373
	$	5,263

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, 2012, 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 2. This valuation was finalized in the third quarter of 2012, and the goodwill was subsequently tested for impairment at December 31, 2012. Based on the testing, management concluded that the goodwill was not impaired at December 31, 2012.

Accounts payable and accrued liabilities

Accounts payable and accrued liabilities consisted of the following at December 31:

	2012		2011
Due to auction clients	$	2,242	$	—
Due to Joint Venture partners		487		89
Sales and other taxes		552		66
Remuneration and benefits		347		402
Asset liquidation expenses		184		—
Regulatory and legal fees		87		49
Accounting, auditing and tax consulting		170		169
Patent licensing and maintenance		9		8
Other		337		72
	$	4,415	$	855