Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

As of September 30, 2014 and December 31, 2013, the Company had $10.0 million and $5.6 million of goodwill acquired. During the nine months ended September 30, 2014, the Company recorded additional goodwill of $2.1 million for the January acquisition of mVisum and $2.3 million for the August acquisition of Prana Technologies (see Note 11, "Business acquisitions"). As of September 30, 2014, there were no changes in circumstances indicating that the carrying values of goodwill or acquired intangibles may not be recoverable.

Intangible Assets

Acquisition-related intangible assets are amortized either straight-line, or over the life of the assets on a basis that resembles the economic benefit of the assets. This yields amortization in the latter case that is higher in earlier periods of the useful life.

The gross carrying amounts of intangible assets which have been fully amortized are removed annually in the subsequent first quarter balance sheet presentation. During the nine months ended September 30, 2014, a fully amortized non-compete agreement intangible with $70,000 original cost (and accumulated amortization) was removed from the table of intangibles carrying cost, offset by increases in intangibles related to the mVisum and Prana Technologies acquisitions, as described in Note 11.

The estimated useful lives and carrying value of acquired intangible assets are as follows:



		September 30, 2014						December 31, 2013
(in thousands)	Range of Useful Life (years)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Developed technology	4 to 7	$	2,710	$	1,583	$	1,127	$	1,880	$	1,264	$	616
Customer relationships	7 to 9	2,520		1,653		867		2,350		1,449		901
Non-compete agreements	2 to 4	460		50		410		70		70		—
Trademarks and trade names	4 to 7	110		58		52		70		43		27
Intangible assets - finite life		5,800		3,344		2,456		4,370		2,826		1,544
In-process research and development	n/a	940		—		940		—		—		—
Intangible assets, net book value		$	6,740	$	3,344	$	3,396	$	4,370	$	2,826	$	1,544

Amortization expense was $0.2 million and $0.2 million for the three months ended September 30, 2014 and 2013, respectively. Amortization expense was $0.6 million and $0.5 million for the nine months ended September 30, 2014 and 2013, respectively.

Amortization of acquired intangible assets is reflected in the cost of revenue or operating expenses, depending on the nature of the intangible. The estimated future amortization of existing acquired intangible assets as of September 30, 2014 , excluding in-process R&D, was as follows:



(in thousands)	Future amortization
2014 (three months remaining)	$	225
2015	727
2016	562
2017	394
2018	275
2019	229
Thereafter	44
Future amortization expense	$	2,456

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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