Intangible Assets And Goodwill

12 Months Ended

Aug. 31, 2016

Intangible Assets And Goodwill [Abstract]

3.INTANGIBLE ASSETS AND GOODWILL

Our intangible assets were comprised of the following (in thousands):



		Gross Carrying		Accumulated		Net Carrying
AUGUST 31, 2016		Amount		Amortization		Amount
Definite-lived intangible assets:
License rights	$	27,000	$	(16,790)	$	10,210
Acquired curriculum		58,564		(42,175)		16,389
Customer lists		16,827		(16,529)		298
Internally developed software		2,049		(2,049)		-
Trade names		1,250		(951)		299
		105,690		(78,494)		27,196
Indefinite-lived intangible asset:
Covey trade name		23,000		-		23,000
	$	128,690	$	(78,494)	$	50,196

AUGUST 31, 2015
Definite-lived intangible assets:
License rights	$	27,000	$	(15,852)	$	11,148
Acquired curriculum		58,549		(40,587)		17,962
Customer lists		16,827		(16,303)		524
Internally developed software		2,049		(1,708)		341
Trade names		1,250		(776)		474
		105,675		(75,226)		30,449
Indefinite-lived intangible asset:
Covey trade name		23,000		-		23,000
	$	128,675	$	(75,226)	$	53,449

Our intangible assets are amortized over the estimated useful life of the asset. The range of remaining estimated useful lives and weighted-average amortization period over which we are amortizing the major categories of definite-lived intangible assets at August 31, 2016 were as follows:


Category of Intangible Asset	Range of Remaining Estimated Useful Lives	Weighted Average Original Amortization Period

License rights	10 years	30 years
Curriculum	3 to 10 years	26 years
Customer lists	1 to 3 years	14 years
Internally developed software	None	3 years
Trade names	1 to 3 years	5 years

Our aggregate amortization expense from definite-lived intangible assets totaled $3.3 million, $3.7 million, and $4.0 million for the fiscal years ended August 31, 2016, 2015, and 2014. Amortization expense from our intangible assets over the next five years is expected to be as follows (in thousands):



YEAR ENDING
AUGUST 31,
2017	$	2,883
2018		2,729
2019		2,489
2020		2,450
2021		2,449

Our goodwill balance at August 31, 2016 was generated from the fiscal 2009 acquisition of CoveyLink Worldwide, LLC (CoveyLink), the fiscal 2013 acquisition of Ninety Five 5, LLC (Ninety Five 5), and the fiscal 2014 acquisition of Red Tree, Inc. The previous owners of CoveyLink, which includes a brother of one of our executive officers, were entitled to earn annual contingent payments based upon earnings growth over the subsequent five years. These contingent payments were classified as goodwill on our consolidated balance sheets when paid according to previously existing business combination guidance. During fiscal 2015, we made a $0.3 million final payment based on the results of a reassessment of the terms and conditions of the CoveyLink acquisition. Our consolidated goodwill changed as follows during fiscal 2016 and 2015 (in thousands):



Balance at August 31, 2014	$	19,641
Contingent consideration payment on
CoveyLink acquisition		262
Accumulated impairments		-
Balance at August 31, 2015		19,903
Accumulated impairments		-
Balance at August 31, 2016	$	19,903

In connection with the reorganization or our internal reporting structure during fiscal 2016, we allocated our goodwill to the new reportable operating segments based on their relative fair values as follows (in thousands):



Direct offices	$	10,790
Strategic markets		2,930
Education practice		2,176
International licensees		4,007
	$	19,903

The goodwill generated by the Red Tree and Ninety Five 5 acquisitions are primarily attributable to the organization, methodologies, and curriculums that complement our existing practices and content. All of the goodwill generated from the acquisition of Red Tree and Ninety Five 5 is expected to be deductible for income tax purposes.

- 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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