Acquisitions

3 Months Ended

Mar. 31, 2012

Acquisitions

Acquisitions

(5)Acquisitions

Contingent Consideration

Accounting Standards Codification (“ASC”) Topic 805 requires that contingent consideration be recognized at fair value on the acquisition date and be re-measured each reporting period with subsequent adjustments recognized in the consolidated statement of operations. We estimate the fair value of contingent consideration liabilities based on financial projections of the acquired companies and estimated probabilities of achievement and discount the liabilities to present value using a weighted-average cost of capital. Contingent consideration is valued using significant inputs that are not observable in the market which are defined as Level 3 inputs pursuant to fair value measurement accounting. We believe our estimates and assumptions are reasonable; however, there is significant judgment involved. At each reporting date, the contingent consideration obligation is revalued to estimated fair value, and changes in fair value subsequent to the acquisitions are reflected in income or expense in the consolidated statements of operations, and could cause a material impact to, and volatility in, our operating results. Changes in the fair value of contingent consideration obligations may result from changes in discount periods, changes in the timing and amount of revenue and/or earnings estimates and changes in probability assumptions with respect to the likelihood of achieving the various earn-out criteria.

Below is a summary of the potential contingent consideration we may be required to pay in connection with completed acquisitions as of March 31, 2012 (dollars in thousands):

	Original range
	of potential		As of March 31, 2012
	undiscounted		Maximum contingent consideration due in
Acquisition:	payments		2012		2013		2014		Total
Milsom	$	0 - $3,600	$	—	$	1,199	$	—	$	1,199
Option Six	$	0 - $2,000	200		—		—		200
Marton House	$	0 - $3,837	1,279		1,279		—		2,558
Bath Consulting	$	0 - $2,437	352		879		1,087		2,318
Academy of Training	$	0 - $160	160		—		—		160
Communication Consulting	$	0 - $700	—		300		—		300
Other			416		—		—		416
Total			$	2,407	$	3,657	$	1,087	$	7,151

Below is a summary of the changes in the recorded amount of contingent consideration liabilities from December 31, 2011 to March 31, 2012 for each acquisition (dollars in thousands):

					Change in
			2012		Fair Value of		Foreign
	Liability as of		Additions		Contingent		Currency	Liability as of
Acquisition:	Dec. 31, 2011		(Payments)		Consideration		Translation	Mar. 31, 2012
Milsom	$	682	(437	)	66		11	$	322
Option Six	800		(800	)	—		—	—
Marton House	311		—		(318	)	7	—
Bath Consulting	1,197		—		288		44	1,529
Academy of Training	49		—		—		1	50
Communication Consulting	239		(200	)	4		1	44
Total	$	3,278	(1,437	)	40		64	$	1,945

As of March 31, 2012 and December 31, 2011, contingent consideration included in accounts payable totaled $1,389,000 and $2,539,000, respectively. As of March 31, 2012 and December 31, 2011, we also had accrued contingent consideration totaling $556,000 and $739,000, respectively, related to acquisitions which is included in other long-term liabilities on the consolidated balance sheet and represents the portion of contingent consideration estimated to be payable greater than twelve months from the balance sheet date.