Note 9. Goodwill and Intangible Assets Level 1 (Notes)

9 Months Ended

Nov. 30, 2011

Goodwill and Intangible Assets [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

Goodwill and Intangible Assets

The change in goodwill is as follows:



Balance at February 28, 2011	$	7,373
Goodwill related to Klipsch acquisition	79,993
Balance at November 30, 2011	$	87,366

At November 30, 2011, intangible assets consisted of the following:



	Gross Carrying Value		Accumulated Amortization		Total Net Book Value
Trademarks/Tradenames not subject to amortization	$	130,612	$	—	$	130,612
Customer relationships subject to amortization (5-20 years)	50,302		6,657		43,645
Trademarks/Tradenames subject to amortization (3-12 years)	1,237		700		537
Patents subject to amortization (5-10 years)	2,942		952		1,990
License subject to amortization (5 years)	1,400		1,143		257
Contract subject to amortization (5 years)	1,556		1,270		286
Total	$	188,049	$	10,722	$	177,327

At February 28, 2011, intangible assets consisted of the following:



	Gross Carrying Value		Accumulated Amortization		Total Net Book Value
Trademarks/Tradenames/Licenses not subject to amortization	$	82,569	$	—	$	82,569
Customer relationships subject to amortization (5-20 years)	18,439		4,142		14,297
Trademarks/Tradenames subject to amortization (3-12 years)	1,237		634		603
Patents subject to amortization (5-10 years)	1,696		797		899
License subject to amortization (5 years)	1,400		933		467
Contract subject to amortization (5 years)	1,556		1,202		354
Total	$	106,897	$	7,708	$	99,189

The Company recorded amortization expense of $1,018 and $469 for the three months ended November 30, 2011 and 2010, respectively, and $3,059 and $1,566 for the nine months ended November 30, 2011 and 2010, respectively. The estimated aggregate amortization expense for the cumulative five years ending November 30, 2016 amounts to $19,243.

We evaluate the carrying value of long-lived assets, including intangible assets subject to amortization, when events and circumstances warrant such a review. The carrying value of long-lived assets is considered impaired when the estimated undiscounted cash flows from such assets are less than their carrying value. In that event, a loss is recognized equal to the amount by which the carrying value exceeds the fair value of the long-lived assets. Fair value is determined by primarily using a discounted cash flow methodology that requires considerable management judgment and long-term assumptions. There were no impairment triggering events during the three and nine months ended November 30, 2011, therefore, management believes the current carrying value of its intangible assets is not impaired. Our estimate of net future cash flows is based on historical experience and assumptions of future trends, which may be different from actual results. We periodically review the appropriateness of the estimated useful lives of our long-lived assets.

- 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.

+ References+ Details