Annual report pursuant to Section 13 and 15(d)

Goodwill and Intangible Assets - Net

v3.7.0.1
Goodwill and Intangible Assets - Net
12 Months Ended
Dec. 31, 2016
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets - Net

5. GOODWILL AND Intangible Assets – NET

 

The following is the summary of the changes to the carrying amount of goodwill for the years ended December 31, 2016 and 2015:

 

    December 31, 2016     December 31, 2015  
Beginning gross balance   $ 8,971,994     $ 8,560,336  
Acquisitions     3,206,874       411,658  
Ending gross balance   $ 12,178,868     $ 8,971,994  

 

Below is a summary of intangible asset activity for the years ended December 31, 2016 and 2015:

 

    Customer     Non-Compete     Other Intangible        
    Relationships     Agreements     Assets     Total  
COST                        
Balance, January 1, 2016   $ 12,166,546     $ 1,206,272     $ 488,082     $ 13,860,900  
Purchase of other intangible assets     -       -       200,404       200,404  
Allocation from 2016 Acquisitions     4,204,829       30,105       600,853       4,835,787  
Balance, December 31, 2016   $ 16,371,375     $ 1,236,377     $ 1,289,339     $ 18,897,091  
Useful lives      3 Years        3 Years        3 Years          
ACCUMULATED AMORTIZATION                                
Balance, January 1, 2016   $ 7,351,532     $ 835,771     $ 294,193     $ 8,481,496  
Amortization expense     4,146,023       270,935       164,931       4,581,889  
Balance, December 31, 2016     11,497,555       1,106,706       459,124       13,063,385  
Net book value   $ 4,873,820     $ 129,671     $ 830,215     $ 5,833,706  
                                 
 COST                                
Balance, January 1, 2015   $ 11,164,988     $ 1,206,272     $ 309,486     $ 12,680,746  
Purchase of other intangible assets     -       -       97,596       97,596  
Acquisition of specific customer relationships     494,358       -       -       494,358  
Allocation from 2015 Acquisitions     507,200       -       81,000       588,200  
Balance, December 31, 2015   $ 12,166,546     $ 1,206,272     $ 488,082     $ 13,860,900  
Useful lives      3 Years        3 Years        3 Years          
ACCUMULATED AMORTIZATION                                
Balance, January 1, 2015   $ 3,754,244     $ 313,647     $ 235,018     $ 4,302,909  
Amortization expense     3,597,288       522,124       59,175       4,178,587  
Balance, December 31, 2015     7,351,532       835,771       294,193       8,481,496  
Net book value   $ 4,815,014     $ 370,501     $ 193,889     $ 5,379,404  

 

Other intangible assets primarily represent the purchase of software. Amortization expense was approximately $4.6 million and $4.2 million for the years ended December 31, 2016 and 2015, respectively. The weighted-average amortization period is three years.

 

As of December 31, 2016, future amortization expense scheduled to be expensed is as follows:

 

Years ending December 31        
2017     $ 3,624,944  
2018       1,476,398  
2019       732,364  
Total     $ 5,833,706