Goodwill and Intangible Assets

12 Months Ended

Jun. 30, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

9.	GOODWILL AND INTANGIBLE ASSETS

SunLink’s Pharmacy segment has goodwill and intangible assets related to its Carmichael acquisition, which consists of:


	June 30,
	2017			2016
Goodwill:
Pharmacy segment	$	0		$	461


		June 30,
	2017			2016
Intangible assets :
Pharmacy segment
Trade Name	$	1,180		$	2,000
Customer Relationships		1,089			1,089
Medicare License		623			769

		2,892			3,858
Accumulated Amortization		(1,305	)		(1,163	)

Total	$	1,587		$	2,695

Impairment testing—During the fourth quarter of fiscal 2017, we completed our annual impairment testing of goodwill and certain intangible assets. The analysis resulted in a goodwill impairment charge of $461 related to the Pharmacy segment for fiscal 2017. Additionally, the Company recognized a $820 impairment charge to the trade name and a $146 impairment charge to the Medicare license for the fiscal year ended June 30, 2017 for the Pharmacy segment. The decline in fair value of our Pharmacy segment below its book value was primarily the result of lower than expected revenues, gross profit margin and customer growth relative to the assumptions made at the acquisition date.

The Trade Name intangible asset under the Pharmacy segment is a non-amortizing intangible asset. The Customer Relationships intangible asset is being amortized over 12 years and the Medicare License intangible asset is being amortized over 15 years. Amortization expense was $142 for each of the fiscal years ended June 30, 2017, 2016 and 2015, respectively.

Annual amortization of amortizing intangibles for the next five years and thereafter is as follows:


2018	$	117
2019		117
2020		100
2021		26
2022		26
Thereafter		21

Total	$	407

- 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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