Goodwill, Trade Names, and Other Identifiable Intangible Assets

12 Months Ended

Dec. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill, Trade Names, and Other Identifiable Intangible Assets

As of December 31, 2015 and 2014, the Company had the following acquired intangible assets:



	December 31, 2015						December 31, 2014
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
	(amounts in thousands)
Intangible assets subject to amortization:
Databases	$	31,225	$	14,150	$	17,075	$	22,425	$	12,893	$	9,532
Customer relationships	47,204		20,734		26,470		42,004		17,870		24,134
Non-compete agreements	3,603		3,486		117		3,603		3,446		157
Trade names, definite-lived	3,200		49		3,151		—		—		—
	$	85,232	$	38,419	$	46,813	$	68,032	$	34,209	$	33,823

Intangible assets not subject to amortization:
Goodwill					$	95,096					$	90,647
Trade names					36,101						38,201
					$	131,197					$	128,848

As of December 31, 2015, estimated annual amortization expense for continuing operations is as follows:



Years Ending December 31:	(amounts in thousands)
2016	$	5,623
2017	5,578
2018	5,493
2019	5,457
2020	4,873
Thereafter	19,789
	$	46,813

The changes in the carrying amount of goodwill by segment are as follows:



	Nurse and Allied Staffing Segment			Physician Staffing Segment		Other Human Capital Management Services Segment			Total
	(amounts in thousands)
Balances as of December 31, 2014
Aggregate goodwill acquired	$	287,667		$	43,405	$	19,307		$	350,379
Accumulated impairment loss	(259,732		)	—		—			(259,732		)
Goodwill, net of impairment loss	27,935			43,405		19,307			90,647

Changes to aggregate goodwill in 2015
Sale of CCE (a)	—			—		(9,889		)	(9,889		)
Goodwill acquired (b)	14,338			—		—			14,338

Balances as of December 31, 2015
Aggregate goodwill acquired	302,005			43,405		19,307			364,717
Sale of CCE (a)	—			—		(9,889		)	(9,889		)
Accumulated impairment loss	(259,732		)	—		—			(259,732		)
Goodwill, net of impairment loss	$	42,273		$	43,405	$	9,418		$	95,096

_______________


(a)	See Note 4 - Disposal and Discontinued Operations.


(b)	Goodwill acquired from the acquisition of Mediscan. See Note 3 - Acquisitions.

2015 and 2014 Annual Impairment Testing Results

The Company performed its annual impairment test as of October 1, 2015 and 2014. Upon completion of the impairment testing, the Company determined that the estimated fair value of its reporting units exceeded their respective carrying values. Accordingly, no goodwill impairment charges were warranted for these reporting units as of December 31, 2015 and 2014.

In conjunction with the annual impairment testing of trade names in the fourth quarter of 2015 and 2014, the Company recorded a pretax non-cash impairment charge of $2.1 million and $10.0 million, respectively, related to the Physician Staffing segment. The Company reduced its long-term revenue forecast for the business segment in the fourth quarter of each year and as a result, the calculation of estimated fair value was less than the carrying amount of the trade names, resulting in an impairment charge. The reduced long-term revenue forecast for 2015 was impacted by lower projected volume resulting from an under-investment in new revenue producers to keep pace with attrition. The reduced long-term revenue forecast for 2014 was impacted by lower projected volume resulting from a delay in changing to a more scalable business model. The Company valued the trade name based on a discounted cash flow using projected cash flows of an estimated royalty fee. The royalty rate was determined by a blended rate using the Market Royalty Rate Method and the Apportionment of Profit Method and has been applied consistently since the date of acquisition. No additional impairments of indefinite-lived intangible assets were identified.

2013 Annual Impairment Testing Results

The Company performed its annual impairment test as of December 31, 2013. Upon completion of the impairment testing, the Company determined that the estimated fair value of its reporting units exceeded their respective carrying values. Accordingly, no goodwill impairment charges were warranted for these reporting units as of December 31, 2013.

In the fourth quarter of 2013, in conjunction with the annual testing of trade names, the Company recorded a pretax non-cash impairment charge of approximately $6.4 million of which $6.2 million related to the Physician Staffing reporting unit and $0.2 million related to the Nurse and Allied Staffing reporting unit. The Company reduced its long-term revenue forecast for these businesses in the fourth quarter and as a result, the calculation of estimated fair value was less than the carrying amount of the trade names, resulting in an impairment charge. The Company valued the trade name based on a discounted cash flow using projected cash flows of an estimated royalty fee. The royalty rate was determined by a blended rate using the Market Royalty Rate Method and the Apportionment of Profit Method and has been applied consistently since the date of acquisition.

The assessment was impacted by a then recent reduction in locum tenens usage and the overall physician staffing needs of the Company's customers. Based on the impact those trends had on the long-term revenue forecast, the calculation of estimated fair value using the projected revenue stream indicated the carrying amount of the trade names may not have been fully recoverable.

- 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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