Goodwill and Other Identifiable Intangible Assets

12 Months Ended

Jun. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Identifiable Intangible Assets

In accordance with ASC 350, Intangibles - Goodwill and Other Intangible Assets, the Company performs its annual goodwill impairment test during the fourth quarter of each fiscal year, or whenever indicators of impairment are present. The reporting units utilized for goodwill impairment tests align directly with our operating segments, Specialty Technology Solutions and Modern Communications & Cloud. The testing includes the determination of each reporting unit's fair value using a discounted cash flows model compared to each reporting unit's carrying value. Key assumptions used in determining fair value include projected growth and operating margin, working capital requirements and discount rates. During fiscal years ended June 30, 2023, 2022 and 2021, no impairment charges related to goodwill were recorded. The fair value of the Specialty Technology Solutions and Modern Communications & Cloud reporting units exceeded its carrying value by 2% and 13%, respectively, as of the annual goodwill impairment testing date.

Changes in the carrying amount of goodwill for the years ended June 30, 2023 and 2022, by reportable segment, are set forth in the table below.


	Specialty Technology Solutions		Modern Communications & Cloud		Total
	(in thousands)
Balance at June 30, 2021	$	16,370	$	202,507	$	218,877


Unrealized loss on foreign currency translation	—		(4,442)		(4,442)
Balance at June 30, 2022	$	16,370	$	198,065	$	214,435


Unrealized gain on foreign currency translation	—		2,271		2,271
Balance at June 30, 2023	$	16,370	$	200,336	$	216,706

The following table shows the Company’s identifiable intangible assets as of June 30, 2023 and 2022, respectively.


	June 30, 2023						June 30, 2022
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
	(in thousands)
Amortized intangible assets:
Customer relationships	$	138,574	$	90,650	$	47,924	$	137,366	$	79,147	$	58,219
Trade names	19,562		14,109		5,453		19,480		12,469		7,011
Non-compete agreements	2,410		2,410		—		2,410		2,396		14

Supplier partner program	4,085		2,481		1,604		4,085		2,051		2,034
Encryption key library	19,900		14,718		5,182		19,900		12,230		7,670
Developed technology	14,262		5,930		8,332		13,865		4,386		9,479
Total intangibles	$	198,793	$	130,298	$	68,495	$	197,106	$	112,679	$	84,427

The weighted-average amortization period for all intangible assets was approximately 10 years for the fiscal years ended June 30, 2023, 2022 and 2021. Amortization expense for continuing operations for the years ended June 30, 2023, 2022 and 2021 was $16.7 million, $17.9 million and $19.5 million, respectively, all of which relates to selling, general and administrative costs, not the cost of selling goods, and has been presented as such in the accompanying Consolidated Income Statements.

Estimated future amortization expense is as follows:


	Amortization Expense
	(in thousands)
Year Ended June 30,
2024	$	16,783
2025	16,783
2026	12,882
2027	6,674
2028	5,317
Thereafter	10,056
Total	$	68,495