Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2011

4. Goodwill and Other Intangible Assets

Goodwill

Changes in the carrying amount of goodwill for the years ended December 31, 2011 and 2010 were as follows (in thousands):

Net book value at December 31, 2009		$ 1,739

	2010 Activity
	Acquisitions	865
	Foreign currency translation	5

Net book value at December 31, 2010		2,609

	2011 Activity
	Acquisitions	1,854
	Foreign currency translation	(1)

Net book value at December 31, 2011		$ 4,462

Intangible Assets Subject to Amortization

As part of the Company’s acquisition of TAS in 2010, the Company recorded intangible assets totaling approximately $735,000 with estimated lives of one to ten years. The Company also recorded intangible assets of $1.5 million with estimated lives of three to eight years as part of the EnVision acquisition in 2011.

The following table shows the gross carrying amount and accumulated amortization of definite-lived intangibles related to continuing operations:

(in thousands)	As of December 31, 2011
		Gross Carrying	Accumulated
	Amount		Amortization			Net
Amortized intangible assets:
Customer relationships	$	646	$	(545	)	$	102
Non-contractual customer relationships		911		(305	)		609
Developed technology		471		(59	)		412
In process research and development		152		(84	)		68
Contract backlog		36		(36	)		-
Trade names and other		29		(13	)		16
Foreign currency translation		12		(8	)		-
Total	$	2,257	$	(1,050	)	$	1,207

	As of December 31, 2010
		Gross Carrying	Accumulated
	Amount		Amortization			Net
Amortized intangible assets:
Customer relationships		208		(43	)	$	166
Non-contractual customer relationships		478		(32	)		449
Contract backlog		35		(24	)		12
Trade names and other		14		(3	)		10
Foreign currency translation		4		-			(4	)
Total	$	739	$	(102	)	$	637

F-19

Amortization is recognized on a straight-line basis over the estimated useful life of the intangible assets, except for contractual customer relationships and contract backlog, which is recognized in proportion to the related projected revenue streams. In 2011, the Company accelerated the amortization expense related to one of TAS’ customer relationships due to the completion of TAS’ contract with the customer. The acceleration resulted in an additional $116,000 of amortization expense in 2011. The Company reviews specific definite-lived intangibles for impairment when events occur that may impact their value in accordance with the respective accounting guidance for long-lived assets. There were no impairment charges recorded for the years ended December 31, 2011, 2010, and 2009.

Amortization expense related to definite-lived intangible assets totaled $948,000 and $102,000 for the years ended December 31, 2011 and 2010, respectively. The following table shows the estimated amortization expense of the definite-lived intangible assets for the next five years and thereafter:

(in thousands)
Fiscal year ending:
	2012	$ (312)
	2013	(207)
	2014	(140)
	2015	(128)
	2016	(121)
	Thereafter	(299)
		$ (1,207)

- Definition

Discloses 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 or 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. This element may be used as a single block of text to include the entire intangible asset disclosure including data and tables.

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