Note 2 - Other Assets	9 Months Ended
Sep. 30, 2017
Notes to Financial Statements
Other Assets Disclosure [Text Block]	2 –Other Assets T he total capitalized costs of the Company’s SAP enterprise software and SAP dealership management system of $30.5 million, including capitalized interest, are recorded on the Consolidated Balance Sheet in Other Assets, net of accumulated amortization of $19.1 million, at September 30, 2017. The SAP software is being amortized over a period of 15 years. Amortization expense relating to the SAP software, which is recognized in depreciation and amortization expense in the Consolidated Statement of Income and Comprehensive Income , was $0.9 million for the three months ended September 30, 2017 and $0.9 million for the three months ended September 30, 2016; it was $2.6 million for the nine months ended September 30, 2017 and $2.5 million for the nine months ended September 30, 2016. The Company currently estimates that amortization expense relating to the SAP software will be approximately $3.4 million for each of the next five years. The Company ’s only significant identifiable intangible assets, other than goodwill, are rights under franchise agreements with manufacturers. The fair value of the franchise right is determined at the acquisition date by discounting the projected cash flows specific to each acquisition. The carrying value of the Company’s manufacturer franchise rights was $7.0 million at both September 30, 2017 and December 31, 2016, and is included in Other Assets on the accompanying consolidated balance sheets. The Company has determined that manufacturer franchise rights have an indefinite life as there are no economic or other factors that limit their useful lives and they are expected to generate cash flows indefinitely due to the historically long lives of the manufacturers’ brand names. Furthermore, to the extent that any agreements evidencing manufacturer franchise rights have expiration dates, the Company expects that it will be able to renew those agreements in the ordinary course of business. Accordingly, the Company does not amortize manufacturer franchise rights. Due to the fact that manufacturer franchise rights are specific to a geographic region, the Company has determined that evaluating and including all locations acquired in the geographic region is the appropriate level for the purpose of testing franchise rights for impairment. Management reviews indefinite-lived manufacturer franchise rights for impairment annually during the fourth quarter, or more often if events or circumstances indicate that an impairment may have occurred. The Company is subject to financial statement risk to the extent that manufacturer franchise rights become impaired due to decreases in the fair market value of its individual franchises within a particular region. The significant estimates and assumptions used by management in assessing the recoverability of manufacturer franchise rights include estimated future cash flows, present value discount rate, and other factors. Any changes in these estimates or assumptions could result in an impairment charge. The estimates of future cash flows, based on reasonable and supportable assumptions and projections, require management’s subjective judgment. Depending on the assumptions and estimates used, the estimated future cash flows projected in the evaluations of manufacturer franchise rights can vary within a range of outcomes. No impairment write down of manufacturer franchise rights was required in any period presented. The Company cannot predict the occurrence of certain events that might adversely affect the reported value of manufacturer franchise rights in the future.

–Other Assets

he total capitalized costs of the Company’s SAP enterprise software and SAP dealership management system of

$30.5

million, including capitalized interest, are recorded on the Consolidated Balance Sheet in Other Assets, net of accumulated amortization of

$19.1

million, at

September 30, 2017.

The SAP software is being amortized over a period of

years.

Amortization expense relating to the SAP

software, which is recognized in depreciation and amortization expense in the Consolidated Statement of Income and Comprehensive Income

, was

$0.9

million

for the

three

months ended

September 30, 2017

and

$0.9

million for the

three

months ended

September 30, 2016;

it was

$2.6

million for the

nine

months ended

September 30, 2017

and

$2.5

million for the

nine

months ended

September 30, 2016.

The Company currently estimates that amortization expense relating to the SAP software will be approximately

$3.4

million for each of the next

five

years.

The Company

’s only significant identifiable intangible assets, other than goodwill, are rights under franchise agreements with manufacturers. The fair value of the franchise right is determined at the acquisition date by discounting the projected cash flows specific to each acquisition.

The carrying value of the Company’s manufacturer franchise rights was

$7.0

million at both

September 30, 2017

and

December 31, 2016,

and is included in Other Assets on the accompanying consolidated balance sheets. The Company has determined that manufacturer franchise rights have an indefinite life as there are

economic or other factors that limit their useful lives and they are expected to generate cash flows indefinitely due to the historically long lives of the manufacturers’ brand names. Furthermore, to the extent that any agreements evidencing manufacturer franchise rights have expiration dates, the Company expects that it will be able to renew those agreements in the ordinary course of business. Accordingly, the Company does

not

amortize manufacturer franchise rights.

Due to the fact that manufacturer franchise rights are specific to

a geographic region, the Company has determined that evaluating and including all locations acquired in the geographic region is the appropriate level for the purpose of testing franchise rights for impairment.

Management reviews indefinite-lived manufacturer franchise rights for impairment annually during the

fourth

quarter, or more often if events or circumstances indicate that an impairment

may

have occurred. The Company is subject to financial statement risk to the extent that manufacturer franchise rights become impaired due to decreases in the fair market value of its individual franchises within a particular region.

The significant estimates and assumptions used by management in assessing the recoverability of manufacturer franchise rights

include estimated future cash flows, present value discount rate, and other factors. Any changes in these estimates or assumptions could result in an impairment charge. The estimates of future cash flows, based on reasonable and supportable assumptions and projections, require management’s subjective judgment. Depending on the assumptions and estimates used, the estimated future cash flows projected in the evaluations of manufacturer franchise rights can vary within a range of outcomes.

impairment write down of manufacturer franchise rights was required in any period presented. The Company cannot predict the occurrence of certain events that might adversely affect the reported value of manufacturer franchise rights in the future.