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PURCHASED INTANGIBLE ASSETS | 12 Months Ended
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Jan. 31, 2016
PURCHASED INTANGIBLE ASSETS |
PURCHASED INTANGIBLE ASSETS | NOTE 8 — PURCHASED INTANGIBLE ASSETS At January 31, 2017, the goodwill balances related to the acquisitions of GPS, TRC and APC were $18.5 million, $14.4 million and $2.0 million, respectively. In July 2016, construction work was suspended on APC’s largest project at that time, which reflected over 90% of its contract backlog. Additionally, APC’s primary market is the United Kingdom, which voted to leave the European Union on June 23, 2016 (“Brexit”). The resulting sterling pound drop, financial market uncertainty and recessionary pressures were considered likely to impact the availability of financing for future power plant developments in the United Kingdom for the foreseeable future. APC’s second largest market was the Middle East, which has experienced decreased project activity due to capital constraints, resulting from decreased oil revenues. APC reported losses during the first half of the fiscal year ended January 31, 2017. Given the events above, analyses were performed in order to determine whether APC’s goodwill had incurred an impairment loss. Using income and market approaches, the assessment analyses indicated that the carrying value of the business exceeded its fair value. As a result, APC recorded an estimated impairment loss at July 31, 2016 related to goodwill of approximately $2.0 million that has been reflected in the consolidated statement of earnings for the year ended January 31, 2017. No impairment loss occurred during the years ended January 31, 2016 or 2015. The Company’s other purchased intangible assets consisted of the following elements as of January 31, 2017 and 2016.
|  |  |  | 2017 |  | 2016 |
|  | Estimated Useful Life |  | Gross Amount |  | Accumulated Amortization |  | Net Amount |  | Net Amount |
Trade names - |  |  |  |  |  |  |  |  |  |  |
GPS |  | 15 years |  | $ | 3,643 |  | $ | 2,464 |  | $ | 1,179 |  | $ | 1,421 |
TRC |  | 15 years |  | 4,499 |  | 350 |  | 4,149 |  | 4,499 |
SMC |  | indefinite |  | 181 |  | — |  | 181 |  | 181 |
Process certifications - |  |  |  |  |  |  |  |  |  |  |
TRC |  | 7 years |  | 1,897 |  | 316 |  | 1,581 |  | 1,852 |
Customer relationships - |  |  |  |  |  |  |  |  |  |  |
TRC |  | 10 years |  | 916 |  | 107 |  | 809 |  | 901 |
APC |  | 4 years |  | 430 |  | 167 |  | 263 |  | 371 |
Other intangibles |  | various |  | 288 |  | 269 |  | 19 |  | 119 |
Totals |  |  |  | $ | 11,854 |  | $ | 3,673 |  | $ | 8,181 |  | $ | 9,344 |
The Company determined the fair values of the trade names using a relief-from-royalty methodology. The Company believes that the useful lives of the trade names for GPS and TRC represent the number of years that such intangibles are expected to contribute to future cash flows. The useful life for the trade name of SMC is considered to be indefinite. In order to value the process certifications of TRC, the Company applied a new reproduction cost method that required the estimation of the costs to replace the assets with certifications that would have the same functionality or utility as the acquired assets. Other intangible assets include primarily the fair values estimated for acquired contract backlogs, other customer relationships and non-compete agreements. The tables below present the activity for the years ended January 31, 2017 and 2016 related to intangible assets, excluding goodwill, that were acquired in connection with business combinations.
|  | 2017 |  | 2016 |
Intangible assets, beginning of year |  | $ | 11,854 |  | $ | 3,824 |
Addition - acquisition of APC |  | — |  | 543 |
Addition - acquisition of TRC |  | — |  | 7,487 |
Total intangible assets, end of year |  | 11,854 |  | 11,854 |
Accumulated amortization, beginning of year |  | 2,510 |  | 1,979 |
Amortization expense |  | 1,163 |  | 531 |
Accumulated amortization, end of year |  | 3,673 |  | 2,510 |
Intangible assets, net |  | $ | 8,181 |  | $ | 9,344 |
The future amounts of amortization expense related to intangibles are presented below for the years ending January 31:
2018 |  | $ | 1,032 |
2019 |  | 1,013 |
2020 |  | 954 |
2021 |  | 905 |
2022 |  | 870 |
Thereafter |  | 3,226 |
Total |  | $ | 8,000 |
For income tax reporting purposes, goodwill in the approximate amount of $14.4 million is being amortized on a straight-line basis over periods of 15 years. The other amounts of the Company’s goodwill are not amortizable for income tax reporting purposes.

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