Quarterly report pursuant to Section 13 or 15(d)

C. INTANGIBLE ASSETS AND GOODWILL

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C. INTANGIBLE ASSETS AND GOODWILL
9 Months Ended
Sep. 30, 2015
Goodwill and Intangible Assets Disclosure [Abstract]  
NOTE C - INTANGIBLE ASSETS AND GOODWILL

Total identifiable intangible assets acquired and their carrying values at September 30, 2015 are:

 

    Cost    

Accumulated

Amortization

    Accumulated Impairment     Carrying Value    

Weighted Average

Amortization Period

(Years)

 
Amortized Identifiable Intangible Assets:                              
Subscriber lists – EthoStream   $ 2,900,000     $ (2,064,323 )   $     $ 835,677       12.0  
Total Amortized Identifiable Intangible Assets     2,900,000       (2,064,323 )           835,677        
Goodwill – EthoStream     8,796,430             (3,000,000 )     5,796,430        
Total Goodwill     8,796,430             (3,000,000 )     5,796,430        
Total   $ 11,696,430     $ (2,064,323 )   $ (3,000,000 )   $ 6,632,107        

 

Total identifiable intangible assets acquired and their carrying values at December 31, 2014 are:

 

    Cost    

Accumulated

Amortization

    Accumulated Impairment     Carrying Value    

Weighted Average

Amortization Period

(Years)

 
Amortized Identifiable Intangible Assets:                                        
Subscriber lists – EthoStream   $ 2,900,000     $ (1,883,063 )   $     $ 1,016,937       12.0  
Total Amortized Identifiable Intangible Assets     2,900,000       (1,883,063 )           1,016,937        
Goodwill – EthoStream     8,796,430             (3,000,000 )     5,796,430        
Goodwill – SSI     5,874,016             (5,874,016 )            
Total Goodwill     14,670,446             (8,874,016 )     5,796,430        
Total   $ 17,570,446     $ (1,883,063 )   $ (8,874,016 )   $ 6,813,367        

 

Total amortization expense charged to operations for each of the three and nine months ended September 30, 2015 and 2014 was $60,420 and $181,260. The weighted average remaining amortization period for the subscriber list is 2.98 years.

 

Estimated future amortization expense as of September 30, 2015 is as follows:

  

Remainder of 2015   $ 60,420  
2016     241,680  
2017     241,680  
2018     241,680  
2019     50,217  
Total   $ 835,677  

 

 

The Company does not amortize goodwill. The Company recorded goodwill in the amount of $14,670,446 as a result of the acquisitions of EthoStream and Smart Systems International (“SSI”) during the year ended December 31, 2007.   The Company evaluates goodwill for impairment based on the fair value of the reporting units to which this goodwill relates at least once a year. The Company utilizes a discounted cash flow valuation methodology (income approach) to determine the fair value of the reporting unit. Since acquisition, the Company has written off $3,000,000 and $5,874,016 of goodwill for EthoStream and SSI, respectively.