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Goodwill and Intangible Assets
 9 Months Ended
Sep. 30, 2020
Goodwill and Intangible Assets [Abstract]  
Goodwill and Intangible Assets
Note 6 - Goodwill and Intangible Assets
Goodwill
We review goodwill for impairment annually as of December 31 and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. We test goodwill at the reporting unit level. A reporting unit is an operating segment, or one level below an operating segment, as defined by U.S. GAAP. We have determined that we have two reporting units, which are the same as our two operating segments: (i) Performance Improvement Solutions ("Performance") and (ii) Nuclear Industry Training and Consulting ("NITC").

We reviewed our goodwill for impairment as of the first quarter of fiscal 2020, due to the COVID-19 interim triggering event. Based upon our analysis, we determined the fair value of our goodwill at the reporting unit level exceeded the carrying value and determined no impairment charge was required as of the period ended March 31, 2020. No other triggering event was noted during the nine months ended September 30, 2020.

The table below reflects the net carrying amount of goodwill from January 1, 2020 to September 30, 2020 for each reporting segment:

(in thousands)
  
Performance
  
NITC
  
Total
 
Balance at January 1, 2020
 
$
4,908
  
$
8,431
  
$
13,339
 
Balance at September 30, 2020
 
$
4,908
  
$
8,431
  
$
13,339
 

Intangible Assets Subject to Amortization

Amortization of intangible assets other than goodwill is recognized on a straight-line basis over the estimated useful life of the intangible assets, except for customer relationships, which are recognized in proportion to the related projected revenue streams. Intangible assets with definite lives are reviewed for impairment if indicators of impairment arise. GSE does not have any intangible assets with indefinite useful lives other than goodwill.

During the first quarter of fiscal 2020, we determined that the impact of the COVID-19 pandemic on our operations was an indicator of a triggering event that could result in an impairment of our long-lived assets. As such, we performed an interim analysis to determine if an impairment existed as of the period ended March 31, 2020 by its individual asset groupings, which management determined to be at the subsidiary level. We used a discounted cash flow analysis to test for impairment and concluded that the carrying value of the definite-lived intangible assets of DP Engineering exceeded its fair value by $4.3 million, and we recorded an impairment for this amount as of the three months ended March 31, 2020.

Management determined no additional triggering impact occurred during the nine months ended September 30, 2020.

Changes in the gross carrying amount, accumulated amortization and impairment of definite-lived intangible assets were as follows:

(in thousands)
 
As of September 30, 2020
 
  
Gross Carrying Amount
  
Accumulated Amortization
  
Impact of Impairment
  
Net
 
Amortized intangible assets:
            
Customer relationships
 
$
11,730
  
$
(5,207
)
 
$
(3,102
)
 
$
3,421
 
Trade names
  
2,467
   
(952
)
  
(778
)
  
737
 
Developed technology
  
471
   
(471
)
  
-
   
-
 
Non-contractual customer relationships
  
433
   
(433
)
  
-
   
-
 
Noncompete agreements
  
949
   
(313
)
  
(422
)
  
214
 
Alliance agreements
  
527
   
(250
)
  
-
   
277
 
Others
  
167
   
(167
)
  
-
   
-
 
Total
 
$
16,744
  
$
(7,793
)
 
$
(4,302
)
 
$
4,649
 

(in thousands)
 
As of December 31, 2019
 
  
Gross Carrying Amount
  
Accumulated Amortization
  
Net
 
Amortized intangible assets:
         
Customer relationships
 
$
11,730
  
$
(4,079
)
 
$
7,651
 
Trade names
  
2,467
   
(727
)
  
1,740
 
Developed technology
  
471
   
(471
)
  
-
 
Non-contractual customer relationships
  
433
   
(433
)
  
-
 
Noncompete agreements
  
949
   
(217
)
  
732
 
Alliance agreements
  
527
   
(171
)
  
356
 
Others
  
167
   
(167
)
  
-
 
Total
 
$
16,744
  
$
(6,265
)
 
$
10,479
 

Amortization expense related to definite-lived intangible assets totaled $0.4 million and $0.6 million for the three months ended September 30, 2020 and 2019. Amortization expense totaled $1.5 million and $1.8 million for the nine months ended September 30, 2020 and 2019, respectively. The following table shows the estimated amortization expense of our definite-lived intangible assets for the next five years and thereafter:
(in thousands)
   
Years ended December 31:
   
2020 (remainder)
 
$
415
 
2021
  
1,213
 
2022
  
911
 
2023
  
640
 
2024
  
435
 
and thereafter
  
1,035
 
Total
 
$
4,649