Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2023

Goodwill and Intangible Assets

Goodwill and Intangible Assets

9. Goodwill and Intangible Assets

The Company has recorded goodwill of $5,811,578 as of September 30, 2023 and December 31, 2022. There were no changes in the carrying amount of goodwill during the nine month period ended September 30, 2023.

Intangible assets consists of the following:

	SEPTEMBER 30, 2023
	Gross Carrying		Accumulated			Net Book
	Amount		Amortization			Value
	(Unaudited)
Customer Relationships	$	2,392,000	$	(478,400	)	$	1,913,600
Channel Relationships		2,628,080		(1,649,850	)		978,230
Internally Developed Software		6,929,439		(3,696,876	)		3,232,563
Trade Name and Trademarks		1,330,472		(321,020	)		1,009,452
	$	13,279,991	$	(6,146,146	)	$	7,133,845

	DECEMBER 31, 2022
	Gross Carrying		Accumulated			Net Book
	Amount		Amortization			Value
Customer Relationships	$	2,392,000	$	(299,000	)	$	2,093,000
Channel Relationships		2,628,080		(1,518,446	)		1,109,634
Internally Developed Software		5,665,957		(2,546,407	)		3,119,550
Trade Name and Trademarks		1,330,472		(254,496	)		1,075,976
	$	12,016,509	$	(4,618,349	)	$	7,398,160

For the three and nine month periods ended September 30, 2023, the Company capitalized $139,600 and $832,400, respectively, of internally developed software costs, primarily associated with upgrading our ITMS™ (Intelligent Technology Management System), secure identity management technology and secure network operations center of which $509,700 was transferred from capital work in progress to internally developed software during the nine month period. Capital work in progress is included in other long-term assets in the consolidated balance sheet.

For the three and nine month periods ended September 30, 2022, the Company capitalized $1.1 million and $2.9 million, respectively, of internally developed software costs, primarily associated with upgrading our ITMS™ (Intelligent Technology Management System), next generation TDI^TM application, secure identity management technology and secure network operations center of which $1.3 million was transferred from capital work in progress to internally developed software and $316,900 was transferred from capital work in progress to property and equipment during the nine month period. Capital work in progress is included in other long-term assets in the consolidated balance sheet.

There were no disposals of intangible assets during the three and nine month period ended September 30, 2023.

The aggregate amortization expense recorded for the three month periods ended September 30, 2023 and 2022 were approximately $526,300 and $365,800,  respectively. The aggregate amortization expense recorded for the nine month periods ended September 30, 2023 and 2022 were approximately $1,533,900 and $958,400,  respectively

As of September 30, 2023, estimated annual amortization for our intangible assets is approximately:

Remainder of 2023	$	566,031
2024		2,123,820
2025		1,450,258
2026		727,570
2027		503,106
Thereafter		1,763,060
Total	$	7,133,845