Goodwill and Intangible Assets

12 Months Ended

Sep. 30, 2011

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

E.	Goodwill and Intangible Assets

Goodwill and intangible assets consisted of the following:

(in thousands)
		September 30,
		2011		2010
Indefinite useful lives:
Goodwill		$	23,550	$	21,021
Licenses			42,092		40,740
	Amortization
	Period
Definite useful lives:
Discounted leases	18 & 6 years		46		64
Unamortized non-compete agreements	5 years		1,045		1,075

Total goodwill and intangible assets		$	66,733	$	62,900

(in thousands)	2011					2010
	Licenses		Goodwill			Licenses			Goodwill
Beginning balance	$	40,740	$	21,021		$	41,058		$	20,320
Intangibles acquired		1,150		2,731			3,459			701
Impairment		-		-			(3,574	)		-
Other		202		(202	)		(203	)		-
Ending balance	$	42,092	$	23,550		$	40,740		$	21,021

Future amortization expense related to definite lived intangible assets subject to amortization at September 30, 2011 for each of the years in the five-year period ending September 30, 2015 and thereafter is (in thousands): 2012 - $438, 2013 - $276, 2014 - $162, 2015 - $122, 2016 - $71, and thereafter - $22.

Goodwill and indefinite lived intangible assets consist of sexually oriented business licenses or goodwill, which were obtained as part of the acquisitions. These licenses are the result of zoning ordinances, thus are valid indefinitely, subject to filing annual renewal applications, which are done at minimal costs to the Company. As cash flows are expected to continue indefinitely, in accordance with FASB ASC 350, Intangibles - Goodwill and Other, the licenses are determined to have indefinite useful lives. The discounted cash flow method of income approach was used in calculating the value of these licenses in a business combination. Impairment of intangible assets was $3,574,000 as of September 30, 2010, representing the impairment of the Philadelphia club.

- 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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