Quarterly report pursuant to Section 13 or 15(d)

Acquisitions, Goodwill and Other Intangible Assets

v3.23.3
Acquisitions, Goodwill and Other Intangible Assets
 9 Months Ended
Sep. 30, 2023
Business Combination and Asset Acquisition [Abstract]  
Acquisitions, Goodwill and Other Intangible Assets Acquisitions, Goodwill and Other Intangible Assets
Goodwill is recorded as part of the Company’s acquisitions and primarily arose from the acquired assembled workforce and brokerage and financing sales platforms. The Company expects all of the goodwill to be tax deductible, with the tax-deductible amount of goodwill related to the contingent and deferred consideration to be determined once the cash payments are made to settle any contingent and deferred consideration. The goodwill resulting from acquisitions is allocated to the Company’s one reporting unit.
Goodwill and intangible assets, net consisted of the following (in thousands):
September 30, 2023 December 31, 2022
Gross
Carrying
Amount		 Accumulated
Amortization 		Net Book
Value		 Gross
Carrying
Amount		 Accumulated
Amortization 		Net Book
Value
Goodwill and intangible assets:            
Goodwill $ 37,909  $ —  $ 37,909  $ 37,914  $ —  $ 37,914 
Intangible assets (1)
30,884  (16,706) 14,178  32,287  (14,505) 17,782 
$ 68,793  $ (16,706) $ 52,087  $ 70,201  $ (14,505) $ 55,696 
(1)
Total weighted average amortization period was 4.0 years and 4.5 years as of September 30, 2023 and December 31, 2022, respectively. Intangible assets principally include non-competes and customer relationships.
The Company recorded amortization expense for intangible assets of $1.3 million and $1.2 million for the three months ended September 30, 2023 and 2022, respectively, and $3.6 million and $3.5 million for the nine months ended September 30, 2023 and 2022.
The changes in the carrying amount of goodwill consisted of the following (in thousands):
Nine Months Ended September 30, 2023
Beginning balance $ 37,914 
Additions from acquisitions — 
Impact of foreign currency translation (5)
Ending balance $ 37,909 
Estimated amortization expense for intangible assets by year for the next five years and thereafter consisted of the following (in thousands):
September 30, 2023
Remainder of 2023 $ 1,063 
2024 4,022 
2025 3,871 
2026 2,156 
2027 1,855 
Thereafter 1,211 
$ 14,178 
The Company evaluates goodwill for impairment annually in the fourth quarter. In addition to the annual impairment evaluation, the Company evaluates at least quarterly whether events or circumstances have occurred in the period subsequent to the annual impairment testing, which indicate that it is more likely than not an impairment loss has occurred. The Company evaluates its intangible assets that have finite useful lives whenever an event or change in circumstances indicates that the carrying value of the asset may not be recoverable.
As of September 30, 2023, the Company considered the impact of economic conditions and evaluated its goodwill and intangible assets for impairment testing. The Company estimated the recoverability of the intangible assets by comparing the carrying amount of each asset to the future undiscounted cash flows that the Company expects the asset to generate. The sum of the undiscounted expected future cash flows was greater than the carrying amount of the intangible assets. The Company concluded that as of September 30, 2023, there was no impairment of its intangible assets or goodwill.