Goodwill and other Identifiable Intangible Assets

9 Months Ended

Jun. 30, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS

Amortizable identifiable intangible assets were (in thousands):



	December 31, 2012							September 30, 2012
	Gross carrying amount		Accum. amort.			Net		Gross carrying amount		Accum. amort.			Net
Purchased and core technology	$	46,603	$	(43,933	)	$	2,670	$	46,597	$	(43,639	)	$	2,958
License agreements	2,840		(2,701		)	139		2,840		(2,682		)	158
Patents and trademarks	11,550		(8,746		)	2,804		10,943		(8,469		)	2,474
Customer maintenance contracts	700		(700		)	—		700		(700		)	—
Customer relationships	18,929		(12,884		)	6,045		17,504		(12,465		)	5,039
Non-compete agreements	2,144		(1,081		)	1,063		1,045		(1,045		)	—
Order backlog	360		(60		)	300		—		—			—
Total	$	83,126	$	(70,105	)	$	13,021	$	79,629	$	(69,000	)	$	10,629

Amortization expense was $1.1 million and $1.2 million for the three month periods ended December 31, 2012 and 2011, respectively. Amortization expense is recorded on our consolidated statement of operations within cost of sales and in general and administrative expense. Estimated amortization expense related to identifiable intangible assets for the remainder of fiscal 2013 and the five succeeding fiscal years is (in thousands):



2013 (nine months)	$	3,393
2014	3,758
2015	2,611
2016	1,417
2017	700
2018	482

The changes in the carrying amount of goodwill are (in thousands):



	Three months ended December 31,
	2012		2011
Beginning balance, October 1	$	86,209	$	86,012
Acquisition of Etherios, Inc.	17,120		—
Foreign currency translation adjustment	62		(405		)
Ending balance, December 31	$	103,391	$	85,607

The goodwill related to the acquisition of Etherios is not tax deductible. Etherios is included in our single reporting segment for purposes of goodwill impairment testing. Goodwill is tested for impairment on an annual basis as of June 30, or more frequently if events or circumstances occur which could indicate impairment. An impairment could have a material effect on our consolidated balance sheet and results of operations. The calculation of asset impairment requires us to make assumptions about future cash flows and revenues. These assumptions require significant judgment and actual results may differ from assumed or estimated amounts. At June 30, 2012, our market capitalization was $264.3 million compared to our carrying value of $265.7 million. Our market capitalization plus our estimated control premium of 40% resulted in a fair value in excess of our carrying value by a margin of 39% and therefore no impairment was indicated.

- 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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