| Goodwill and Intangible Assets - Net |
4.
GOODWILL AND Intangible Assets – NET
Goodwill consists of the excess of the purchase
price over the fair value of identifiable net assets of businesses acquired. The following is the summary of the changes to the
carrying amount of goodwill for the years ended December 31, 2020 and 2019:
| |
|
Year ended December 31, |
|
| |
|
2020 |
|
|
2019 |
|
| |
|
($ in thousands) |
|
| Beginning gross balance |
|
$ |
12,634 |
|
|
$ |
12,594 |
|
| Acquisitions |
|
|
36,657 |
|
|
|
40 |
|
| Ending gross balance |
|
$ |
49,291 |
|
|
$ |
12,634 |
|
At December 31, 2020, and 2019, approximately
$90,000 of goodwill was allocated to the Practice Management segment and the balance was allocated to the Healthcare IT segment.
Below is a summary of intangible asset activity
for the years ended December 31, 2020 and 2019:
| |
|
Customer |
|
|
Capitalized |
|
|
Other Intangible |
|
|
|
|
| |
|
Relationships |
|
|
Software |
|
|
Assets |
|
|
Total |
|
| COST |
|
($ in thousands) |
|
| Balance, January 1, 2020 |
|
$ |
23,597 |
|
|
$ |
600 |
|
|
$ |
2,664 |
|
|
$ |
26,861 |
|
| Capitalized software costs |
|
|
- |
|
|
|
5,163 |
|
|
|
4,800 |
|
|
|
9,963 |
|
| Other intangible assets |
|
|
- |
|
|
|
- |
|
|
|
1,700 |
|
|
|
1,700 |
|
| Translation loss |
|
|
- |
|
|
|
(3 |
) |
|
|
(22 |
) |
|
|
(25 |
) |
| Allocation from 2020 acquisitions |
|
|
20,900 |
|
|
|
- |
|
|
|
- |
|
|
|
20,900 |
|
| Balance, December 31, 2020 |
|
$ |
44,497 |
|
|
$ |
5,760 |
|
|
$ |
9,142 |
|
|
$ |
59,399 |
|
| Useful lives |
|
|
3-12 years |
|
|
|
3 years |
|
|
|
3 years |
|
|
|
|
|
| ACCUMULATED AMORTIZATION |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, January 1, 2020 |
|
$ |
18,314 |
|
|
$ |
6 |
|
|
$ |
2,564 |
|
|
$ |
20,884 |
|
| Amortization expense |
|
|
7,694 |
|
|
|
239 |
|
|
|
604 |
|
|
|
8,537 |
|
| Balance, December 31, 2020 |
|
|
26,008 |
|
|
|
245 |
|
|
|
3,168 |
|
|
|
29,421 |
|
| Net book value |
|
$ |
18,489 |
|
|
$ |
5,515 |
|
|
$ |
5,974 |
|
|
$ |
29,978 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| COST |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, January 1, 2019 |
|
$ |
22,741 |
|
|
$ |
62 |
|
|
$ |
2,651 |
|
|
$ |
25,454 |
|
| Capitalized software costs |
|
|
- |
|
|
|
538 |
|
|
|
54 |
|
|
|
592 |
|
| Translation loss |
|
|
- |
|
|
|
- |
|
|
|
(41 |
) |
|
|
(41 |
) |
| Allocation from 2019 acquisition |
|
|
856 |
|
|
|
- |
|
|
|
- |
|
|
|
856 |
|
| Balance, December 31, 2019 |
|
$ |
23,597 |
|
|
$ |
600 |
|
|
$ |
2,664 |
|
|
$ |
26,861 |
|
| Useful lives |
|
|
3-12 years |
|
|
|
3 years |
|
|
|
3 years |
|
|
|
|
|
| ACCUMULATED AMORTIZATION |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, January 1, 2019 |
|
$ |
16,458 |
|
|
$ |
- |
|
|
$ |
2,363 |
|
|
$ |
18,821 |
|
| Amortization expense |
|
|
1,856 |
|
|
|
6 |
|
|
|
201 |
|
|
|
2,063 |
|
| Balance, December 31, 2019 |
|
|
18,314 |
|
|
|
6 |
|
|
|
2,564 |
|
|
|
20,884 |
|
| Net book value |
|
$ |
5,283 |
|
|
$ |
594 |
|
|
$ |
100 |
|
|
$ |
5,977 |
|
Other intangible assets primarily represent
software costs. Amortization expense was approximately $8.6 million and $2.1 million for the years ended December 31, 2020 and
2019, respectively. The weighted-average amortization period is four years.
As of December 31, 2020, future amortization
expense scheduled to be expensed is as follows:
| Years ending |
|
|
|
| December 31, |
|
($ in thousands) |
|
| 2021 |
|
$ |
9,186 |
|
| 2022 |
|
|
8,887 |
|
| 2023 |
|
|
7,105 |
|
| 2024 |
|
|
3,150 |
|
| 2025 |
|
|
300 |
|
| Thereafter |
|
|
1,350 |
|
| Total |
|
$ |
29,978 |
|
|