6. Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2013

Notes to Financial Statements

Note 6. Goodwill and Other Intangible Assets

As a result of the merger with LyndonBank on December 31, 2007, the Company recorded goodwill amounting to $11,574,269.  The goodwill is not amortizable and is not deductible for tax purposes.

The Company also recorded $4,161,000 of acquired identified intangible assets representing the core deposit intangible which is subject to amortization as a non-interest expense over a ten year period.  The accumulated amortization expense was $3,002,049 and $2,712,306 as of September 30, 2013 and 2012, respectively.

Amortization expense for the core deposit intangible for the first nine months of 2013 was $204,525.  As of September 30, 2013, the remaining annual amortization expense related to the core deposit intangible, absent any future impairment, is expected to be as follows:

2013	$	68,170
2014		272,695
2015		272,695
2016		272,695
2017		272,696
Total remaining core deposit intangible	$	1,158,951

Management evaluates goodwill for impairment annually and the core deposit intangible for impairment if conditions warrant.  As of the date of the most recent evaluation (December 31, 2012), management concluded that no impairment existed in either category.