INTANGIBLE ASSETS AND GOODWILL

9 Months Ended

Jun. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS AND GOODWILL

NOTE 4          INTANGIBLE ASSETS AND GOODWILL

Intangible Assets

The Company’s intangible assets consist of the following:

	June 30, 2024									September 30, 2023
	Trademarks			Customer Relationships			Total Intangible Assets			Trademarks			Customer Relationships			Total Intangible Assets
Gross carrying amount	$	585,000		$	1,390,000		$	1,975,000		$	585,000		$	1,390,000		$	1,975,000
Less accumulated amortization		(232,000	)		(1,009,000	)		(1,241,000	)		(203,000	)		(879,000	)		(1,082,000	)
Net carrying amount	$	353,000		$	381,000		$	734,000		$	382,000		$	511,000		$	893,000

The Company’s intangible assets resulted from the acquisitions of Kablooe and IPS in Fiscal 2020 and Fiscal 2018, respectively, and relate to the design segment of our business. Intangible assets are amortized over their expected useful lives of 15 years for the trademarks and eight years for the customer relationships. Amortization expense related to intangible assets was $53,000 for the three months ended June 30, 2024 and 2023, and $160,000 for the nine months ended June 30, 2024 and 2023, which is included in general and administrative expenses on the condensed consolidated statements of operations.

At June 30, 2024, estimated amortization expense for the Company’s intangible assets is as follows:

Remainder of Fiscal 2024	$	53,000
Fiscal 2025		213,000
Fiscal 2026		121,000
Fiscal 2027		82,000
Fiscal 2028		78,000
Fiscal 2029		39,000
Thereafter		148,000
Total	$	734,000

Goodwill

Goodwill represents the future economic benefits of assets acquired in a business combination that are not individually identified or separately recognized. The Company’s goodwill resulted from the acquisitions of Kablooe and IPS in Fiscal 2020 and Fiscal 2018, respectively. The goodwill associated with the IPS acquisition is not deductible for tax purposes, but the goodwill associated with the Kablooe acquisition is deductible for tax purposes. All of the Company’s goodwill is held under the design segment of our business.