GOODWILL AND INTANGIBLE ASSETS

12 Months Ended

Dec. 31, 2017

NOTE D – GOODWILL AND INTANGIBLE ASSETS

Goodwill represents the excess of cost over the fair value of net identifiable tangible and intangible assets acquired. Goodwill by reportable operating segment consisted of the following:



	Total		ArcBest		FleetNet
	(in thousands)
Balances December 31, 2015	$	96,465	$	95,835	$	630
Goodwill acquired(1)		12,640		12,640		—
Goodwill divested(2)		(842)		(842)		—
Purchase accounting adjustments		612		612		—
Balances December 31, 2016	$	108,875	$	108,245	$	630
Goodwill divested(2)		(661)		(661)		—
Purchase accounting adjustments		106		106		—
Balances December 31, 2017	$	108,320	$	107,690	$	630

⁽¹⁾

Goodwill related to the September 2, 2016 acquisition of LDS is expected to be fully deductible for tax purposes.

⁽²⁾

Goodwill divested due to the sale of certain non-strategic businesses was determined based on the relative fair value of the businesses sold to the total fair value of the reporting unit.

Intangible assets consisted of the following as of December 31:


		2017						2016
	Weighted-Average			Accumulated		Net				Accumulated		Net
	Amortization Period	Cost		Amortization		Value			Cost	Amortization		Value
	(in years)	(in thousands)						(in thousands)
Finite-lived intangible assets
Customer relationships	14	$	60,431	$	19,745	$	40,686	$	60,431	$	15,350	$	45,081
Driver network	3		3,200		3,200		—		3,200		3,200		—
Other	9		1,032		549		483		1,032		406		626
	13		64,663		23,494		41,169		64,663		18,956		45,707
Indefinite-lived intangible assets
Trade name	N/A		32,300		N/A		32,300		32,300		N/A		32,300
Other(1)	N/A		—		N/A		—		2,500		N/A		2,500
			32,300				32,300		34,800				34,800
Total intangible assets	N/A	$	96,963	$	23,494	$	73,469	$	99,463	$	18,956	$	80,507

¹⁾

Other indefinite-lived intangible assets divested due to the sale of certain non-strategic businesses.

The future amortization for intangible assets and acquired software as of December 31, 2017 were as follows:


			Intangible		Acquired
	Total		Assets		Software(1)
	(in thousands)
2018	$	6,641	$	4,520	$	2,121
2019		5,463		4,482		981
2020		4,471		4,454		17
2021		4,418		4,412		6
2022		4,385		4,385		—
Thereafter		18,916		18,916		—
Total amortization	$	44,294	$	41,169	$	3,125

⁽¹⁾

Acquired software is reported in property, plant and equipment.

Annual impairment evaluations of goodwill and indefinite‑lived intangible assets were performed as of October 1, 2017 and 2016, and it was determined that there was no impairment of the recorded balances. In November 2016, the Company determined it would discontinue the use of certain software applications as a result of the realignment of the Company’s corporate structure and recorded a non-cash impairment charge of $6.2 million which includes the write-down of $5.5 million of acquired software in the ArcBest segment to its fair value, reflecting estimated reproduction costs less an obsolescence allowance. (See Note N for disclosure of the Company’s restructuring costs.)

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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