Annual report pursuant to Section 13 and 15(d)

Goodwill and Intangible Assets

v3.10.0.1
Goodwill and Intangible Assets
12 Months Ended
Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets
GOODWILL AND INTANGIBLE ASSETS
The changes in the carrying value of goodwill attributable to each reportable segment are as follows:
 
U.S. Regions
 
U.S. Federal
 
Canada
 
Other
 
Total
Balance, December 31, 2016
$
24,759

 
$
3,375

 
$
3,262

 
$
26,580

 
$
57,976

Sale of assets of a business


 

 

 
(2,639
)
 
(2,639
)
Currency effects

 

 
232

 
566

 
798

Balance, December 31, 2017
24,759

 
3,375

 
3,494

 
24,507

 
56,135

Goodwill acquired during the year
1,611

 
1,234

 

 

 
2,845

Currency effects

 

 
(277
)
 
(371
)
 
(648
)
Balance, December 31, 2018
$
26,370

 
$
4,609

 
$
3,217

 
$
24,136

 
$
58,332

Accumulated Goodwill Impairment Balance, December 31, 2017
$

 
$

 
$
(1,016
)
 
$

 
$
(1,016
)
Accumulated Goodwill Impairment Balance, December 31, 2018
$

 
$

 
$
(1,016
)
 
$

 
$
(1,016
)

In accordance with ASC 350, goodwill was tested for impairment as of December 31, 2018, 2017 and 2016 at the reporting unit level under the income approach which uses, in part, a discounted cash flow method and a peer-based, and a risk-adjusted weighted average cost of capital. No impairment was recorded in the December 31, 2018, 2017 or 2016 assessments. Based on the Company’s goodwill impairment assessment, all of its reporting units with goodwill had estimated fair values as of December 31, 2018 that exceeded their carrying values by at least 20%.
Based on the Company’s goodwill impairment assessment, all of its reporting units with goodwill had estimated fair values as of December 31, 2017 that exceeded their carrying values by at least 20%. However, during the course of the valuation analysis it was determined that although the fair value of the Company’s Canada reporting unit exceeded the carrying amount of this reporting unit, the carrying value of the reporting unit was negative as of December 31, 2017. The Canada reporting unit had goodwill of $3,494 as of December 31, 2017.
The gross carrying amount and accumulated amortization of intangible assets are as follows:
 
As of December 31,
 
2018
 
2017
Gross Carrying Amount
 
 
 
Customer contracts
$
7,818

 
$
7,786

Customer relationships
12,082

 
11,863

Non-compete agreements
3,013

 
3,052

Technology
2,710

 
2,751

Trade names
541

 
546

 
26,164

 
25,998

Accumulated Amortization
 
 
 
Customer contracts
7,668

 
7,786

Customer relationships
10,302

 
9,557

Non-compete agreements
3,013

 
3,048

Technology
2,651

 
2,642

Trade names
526

 
525

 
24,160

 
23,558

Intangible assets, net
$
2,004

 
$
2,440


Amortization expense related to customer contracts is included in cost of revenues in the consolidated statements of income (loss). Amortization expense related to customer relationships, non-compete agreements, technology and trade names is included in selling, general and administrative expenses in the consolidated statements of income (loss).

Customer contracts are amortized ratably over the period of the acquired customer contracts ranging in periods from approximately one to eight years. All other intangible assets are amortized over periods ranging from approximately four to fifteen years, as defined by the nature of the respective intangible asset.

Separable intangible assets that are not deemed to have indefinite lives are amortized over their useful lives. The Company annually assesses whether a change in the life over which the Company’s assets are amortized is necessary or more frequently if events or circumstances warrant. No changes to useful lives were made during the years ended December 31, 2018, 2017 and 2016.

Amortization expense for the years ended December 31, 2018, 2017 and 2016 is as follows:
 
Year Ended December 31,
 
2018
 
2017
 
2016
Customer contracts
$
30

 
$
31

 
$
184

Customer relationships
973

 
1,244

 
1,809

Non-compete agreements
3

 
42

 
116

Technology
47

 
128

 
238

Trade names
4

 
6

 
11

Total intangible amortization expense
$
1,057

 
$
1,451

 
$
2,358


Estimated amortization expense for existing intangible assets for the next five succeeding fiscal years is as follows:
 
Estimated Amortization
 
Included in Selling, General and Administrative Expenses
2019
$
844

2020
620

2021
247

2022
75

2023
66

Thereafter
152

 
$
2,004