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Goodwill and Other Intangible Assets | 9 Months Ended
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Sep. 30, 2020
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in each business combination. Goodwill and intangible assets with indefinite useful lives are not amortized, but are tested for impairment at least annually at the reporting unit level. Impairment is the condition that exists when the carrying amount of a reporting unit, including goodwill, exceeds its fair value. Our reportable segments are consistent with our operating segments. Determining the fair value of a reporting unit requires the use of significant estimates and assumptions, including revenue growth rates, operating margins, discount rates, and future market conditions, among others. Goodwill and other long-lived assets are reviewed for impairment whenever events, such as significant changes in the business climate, plant closures, changes in product offerings, or other circumstances indicate that the carrying amount may not be recoverable. To determine fair value, we utilize market-based approaches and an income approach. Under the market-based approaches, we utilize information regarding the Company, as well as publicly available industry information, to determine earnings multiples and sales multiples. Under the income approach, we determine fair value based on estimated future cash flows of each reporting unit, discounted by an estimated weighted-average cost of capital, which reflects the overall level of inherent risk of a reporting unit and the rate of return an outside investor would expect to earn. In the second quarter of 2020, management applied the quantitative assessment approach in performing its annual evaluation of goodwill and concluded that no impairment provision was required. As part of this evaluation, the Company considered projected cash flows and market multiples for the Company’s Machine Clothing reporting unit and three AEC reporting units. Management performed assessments as to whether the fair value of each reporting unit was less than its carrying value as of June 30, 2020 and concluded that it was more likely than not that each reporting unit’s fair value continued to exceed its carrying value. In addition, there were no amounts at risk due to the estimated spread between the fair and carrying values. Accordingly, no impairment charges were recorded. We are continuing to amortize certain patents, trade names, customer relationships, customer contracts and technology assets that have finite lives. The gross carrying value, accumulated amortization and net values of intangible assets and goodwill as of September 30, 2020 and December 31, 2019, were as follows:
As of September 30, 2020 | Weighted average amortization life in years | Gross carrying amount | Accumulated amortization | Net carrying amount
(in thousands) |  |  |  |
Amortized intangible assets: |  |  |  |
AEC Trademarks and trade names | 6-15 | $ | 208 |  | $ | (148) |  | $ | 60 |
AEC Technology | 10-15 | 6,522 |  | (871) |  | 5,651 |
AEC Intellectual property | 15 | 1,250 |  | (68) |  | 1,182 |
AEC Customer contracts | 6 | 17,471 |  | (13,110) |  | 4,361 |
AEC Customer relationships | 8-15 | 51,763 |  | (14,768) |  | 36,995 |
AEC Other intangibles | 5 | 322 |  | (290) |  | 32 |
Total amortized intangible assets |  | $ | 77,536 |  | $ | (29,255) |  | $ | 48,281 |
Unamortized intangible assets: |  |  |  |
MC Goodwill |  | $ | 69,884 |  | $ | — |  | $ | 69,884 |
AEC Goodwill |  | 114,403 |  | — |  | 114,403 |
Total unamortized intangible assets: |  | $ | 184,287 |  | $ | — |  | $ | 184,287 |
As of December 31, 2019 | Weighted average amortization life in years | Gross carrying amount | Accumulated amortization | Net carrying amount
(in thousands) |  |  |  |
Amortized intangible assets: |  |  |  |
AEC Trademarks and trade names | 6-15 | $ | 208 |  | $ | (135) |  | $ | 73 |
AEC Technology | 10-15 | 6,191 |  | (387) |  | 5,804 |
AEC Intellectual property | 15 | 1,250 |  | (7) |  | 1,243 |
AEC Customer contracts | 6 | 17,471 |  | (10,927) |  | 6,544 |
AEC Customer relationships | 8-15 | 51,255 |  | (12,108) |  | 39,147 |
AEC Other intangibles | 5 | 322 |  | (241) |  | 81 |
Total amortized intangible assets |  | $ | 76,697 |  | $ | (23,805) |  | $ | 52,892 |
Unamortized intangible assets: |  |  |  |
MC Goodwill |  | $ | 67,672 |  | $ | — |  | $ | 67,672 |
AEC Goodwill |  | 113,262 |  | — |  | 113,262 |
Total unamortized intangible assets: |  | $ | 180,934 |  | $ | — |  | $ | 180,934 |
The changes in intangible assets, net and goodwill from December 31, 2019 to September 30, 2020, were as follows:
(in thousands) | December 31, 2019 | Other Changes | Amortization | Currency Translation | September 30, 2020
Amortized intangible assets: |  |  |  |  |
AEC Trademarks and trade names | $ | 73 |  | $ | — |  | $ | (13) |  | $ | — |  | $ | 60 |
AEC Technology | 5,804 |  | — |  | (480) |  | 327 |  | 5,651 |
AEC Intellectual property | 1,243 |  | — |  | (61) |  | — |  | 1,182 |
AEC Customer contracts | 6,544 |  | — |  | (2,183) |  | — |  | 4,361 |
AEC Customer relationships | 39,147 |  | 329 |  | (2,626) |  | 145 |  | 36,995 |
AEC Other intangibles | 81 |  | — |  | (49) |  | — |  | 32 |
Total amortized intangible assets | $ | 52,892 |  | $ | 329 |  | $ | (5,412) |  | $ | 472 |  | $ | 48,281 |
Unamortized intangible assets: |  |  |  |  |
MC Goodwill | $ | 67,672 |  | $ | — |  | $ | — |  | $ | 2,212 |  | $ | 69,884 |
AEC Goodwill | 113,262 |  | 335 |  | — |  | 806 |  | 114,403 |
Total unamortized intangible assets: | $ | 180,934 |  | $ | 335 |  | $ | — |  | $ | 3,018 |  | $ | 184,287 |
Estimated amortization expense of intangibles for the years ending December 31, 2020 through 2024, is as follows:
Year | Annual amortization (in thousands)
2020 | $ | 7,200 |
2021 | 7,100 |
2022 | 4,900 |
2023 | 4,200 |
2024 | 4,200 |

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- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -URI http://asc.fasb.org/topic&trid=2144416 + Details
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