| 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, 2022 and 2021:
SCHEDULE
OF INTANGIBLE ASSETS AND GOODWILL
| |
|
|
|
|
|
|
|
|
| |
|
Year Ended December 31, |
|
| |
|
2022 |
|
|
2021 |
|
| |
|
($ in thousands) |
|
| Beginning gross balance |
|
$ |
61,186 |
|
|
$ |
49,291 |
|
| Acquisition, net of adjustments |
|
|
- |
|
|
|
11,895 |
|
| Ending gross balance |
|
$ |
61,186 |
|
|
$ |
61,186 |
|
At
December 31, 2022, and 2021, approximately $90,000 of goodwill was allocated to the Medical Practice Management segment and the balance
was allocated to the Healthcare IT segment.
Below
is a summary of intangible asset activity for the years ended December 31, 2022 and 2021:
SCHEDULE
OF FINITE - LIVED INTANGIBLE ASSETS
| |
|
Customer |
|
|
Capitalized |
|
|
Other Intangible |
|
|
|
|
| |
|
Relationships |
|
|
Software |
|
|
Assets |
|
|
Total |
|
| |
|
($ in thousands) |
|
| COST |
|
|
|
| Balance, January 1, 2022 |
|
$ |
47,597 |
|
|
$ |
13,196 |
|
|
$ |
9,632 |
|
|
$ |
70,425 |
|
| Additions |
|
|
- |
|
|
|
9,160 |
|
|
|
19 |
|
|
|
9,179 |
|
| Translation loss |
|
|
- |
|
|
|
(809 |
) |
|
|
- |
|
|
|
(809 |
) |
| Allocation from 2021 acquisition |
|
|
3,100 |
|
|
|
- |
|
|
|
490 |
|
|
|
3,590 |
|
| Balance, December 31, 2022 |
|
$ |
47,597 |
|
|
$ |
21,547 |
|
|
$ |
9,651 |
|
|
$ |
78,795 |
|
| Useful lives |
|
|
3-12 years |
|
|
|
3 years |
|
|
|
3 years |
|
|
|
|
|
| ACCUMULATED AMORTIZATION |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, January 1, 2022 |
|
$ |
33,851 |
|
|
$ |
1,591 |
|
|
$ |
4,205 |
|
|
$ |
39,647 |
|
| Amortization expense |
|
|
5,672 |
|
|
|
3,341 |
|
|
|
615 |
|
|
|
9,628 |
|
| Balance, December 31, 2022 |
|
|
39,523 |
|
|
|
4,932 |
|
|
|
4,820 |
|
|
|
49,275 |
|
| Net book value |
|
$ |
8,074 |
|
|
$ |
16,615 |
|
|
$ |
4,831 |
|
|
$ |
29,520 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| COST |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, January 1, 2021 |
|
$ |
44,497 |
|
|
$ |
5,760 |
|
|
$ |
9,142 |
|
|
$ |
59,399 |
|
| Additions |
|
|
- |
|
|
|
7,636 |
|
|
|
- |
|
|
|
7,636 |
|
| Translation loss |
|
|
- |
|
|
|
(200 |
) |
|
|
- |
|
|
|
(200 |
) |
| Allocation from 2021 acquisition |
|
|
3,100 |
|
|
|
- |
|
|
|
490 |
|
|
|
3,590 |
|
| Balance, December 31, 2021 |
|
$ |
47,597 |
|
|
$ |
13,196 |
|
|
$ |
9,632 |
|
|
$ |
70,425 |
|
| Useful lives |
|
|
3-12 years |
|
|
|
3 years |
|
|
|
3 years |
|
|
|
|
|
| ACCUMULATED AMORTIZATION |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, January 1, 2021 |
|
$ |
26,008 |
|
|
$ |
245 |
|
|
$ |
3,168 |
|
|
$ |
29,421 |
|
| Amortization expense |
|
|
7,843 |
|
|
|
1,346 |
|
|
|
1,037 |
|
|
|
10,226 |
|
| Balance, December 31, 2021 |
|
|
33,851 |
|
|
|
1,591 |
|
|
|
4,205 |
|
|
|
39,647 |
|
| Net book value |
|
$ |
13,746 |
|
|
$ |
11,605 |
|
|
$ |
5,427 |
|
|
$ |
30,778 |
|
The
amount for capitalized software represents payroll and development costs incurred for internally developed software. Other intangible
assets primarily represent non-compete agreements, purchased and acquired software and trademarks. Amortization expense was approximately
$9.8 million and $10.3 million for the years ended December 31, 2022 and 2021, respectively. The weighted-average amortization period
is three years.
As
of December 31, 2022, future amortization expense scheduled to be expensed is as follows:
SCHEDULE
OF FINITE-LIVED INTANGIBLE ASSETS, FUTURE AMORTIZATION EXPENSE
| |
|
|
|
|
|
| Years ending December 31, |
|
|
($ in thousands) |
|
| 2023 |
|
|
$ |
13,632 |
|
| 2024 |
|
|
|
8,873 |
|
| 2025 |
|
|
|
5,665 |
|
| 2026 |
|
|
|
300 |
|
| 2027 |
|
|
|
300 |
|
| Thereafter |
|
|
|
750 |
|
| Total |
|
|
$ |
29,520 |
|
|