Quarterly report pursuant to Section 13 or 15(d)

8. Goodwill and Intangible Assets, Net

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8. Goodwill and Intangible Assets, Net
9 Months Ended
Sep. 30, 2015
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets, Net

Goodwill

 

In association with the Merger, the Company recognized $10,365,805 in Goodwill, representing the excess of the fair value of the consideration for the Merger over net identifiable assets acquired (See Note 3 - Business Combination for additional information). Pursuant to ASC 350-20, Goodwill is not subject to amortization but is subject to annual review to determine if certain events warrant impairment to the Goodwill asset. Through September 30, 2015, the Company has not recognized any impairment related to Goodwill.

 

Intangible Assets, Net

 

The Company had following intangible assets as of September 30, 2015 and December 31, 2014:

 

    9/30/2015     12/31/2014  
Identifiable artistic-related assets (a)   $ 1,740,000     $ 1,740,000  
Trademarks (b)     129,831       129,831  
Product Masters (b)     64,676       3,257,129  
Other Intangible Assets (b)     181,220       70,000  
Less Accumulated Amortization (c)     (178,390 )     (3,320,522 )
Intangible Assets, Net   $ 1,937,337     $ 1,876,438  

 

(a) In association with the Merger, the Company acquired $1,740,000 in identifiable artistic-related assets. These assets, related to certain properties owned by A Squared and assumed by the Company, were valued using an independent firm during the fourth quarter of 2013. Based on certain legal, regulatory, contractual, and economic factors, the Company has deemed these assets to be indefinite-lived. Hence, pursuant to ASC 350-30, these assets are not subject to amortization and are tested annually for impairment.  Through September 30, 2015, the Company has not recognized any impairment expense related to these assets.
(b) Pursuant to ASC 350-30-35, the Company reviews these intangible assets periodically to determine if the value should be retired or impaired due to recent events. During the six months ended September 30, 2015 and 2014, the Company did not recognize any impairment of these assets.
(c) During the nine months ended September 30, 2015 and 2014, the Company recognized $50,322 and $45,527, respectively, in amortization expense related to these intangible assets.

 

Expected future intangible asset amortization as of September 30, 2015 is as follows:

 

Fiscal Year:        
2015   $ 34,835  
2016     38,596  
2017     17,180  
2018     8,655  
2019     8,655  
Total   $ 107,921