7 INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS

NOTE 7.        INTANGIBLE ASSETS

We amortize our intangible assets that have finite lives using either the straight-line method or based on estimated future cash flows to  approximate the pattern in which the economic benefit of the asset will be utilized. Amortization expense was $194,000 and $12,500 during the six months ended June 30, 2016 and 2015, respectively. This amortization expense relates to customer lists, which expire through 2020.

Estimated annual amortization expense (including amortization expense associated with capitalized software costs) for the current year and the following four years ending December 31, is as follows:

	Amortization Expense
2016	$388,000
2017	$388,000
2018	$388,000
2019	$363,000

The Company has its own software products, namely Simple APO, Langer Index, and IBP.  Total costs incurred for developing these products during the six months ended June 30, 2016 was $55,104 and have been capitalized. These costs will be amortized over the useful life once all substantial testing has been completed.

Of the acquisition consideration paid for Bellsoft, $1.81 million was for its customer list, which is considered an intangible asset that was acquired by the Company.

As of June 30, 2016 and December 31, 2015, capitalized intangible assets were $3,334,367, and $3,279,263 respectively, and accumulated amortization was $358,750 and $164,750, respectively. As of June 30, 2016 and December 31, 2015, total intangible assets were $2,975,617 and $3,114,513, respectively.

.