Mandalay Digital Group, Inc. - FORM 10-Q - XML - IDEA: XBRL DOCUMENT

Goodwill and Other Intangible Assets

9 Months Ended

Dec. 31, 2011

Goodwill and Other Intangible Assets

Goodwill

The Company's carrying amount of goodwill for the periods ended December 31, 2011 and March 31, 2011 was $6,609

We complete our annual impairment tests in the fourth quarter of each year unless events or circumstances indicate that an asset may be impaired. There were no indications of impairment present during the period ended December 31, 2011. Because there were no indications of impairment present, the Company did not book an impairment in the period ended December 31, 2011. In the period ended December 31, 2010, the Company determined that there was an impairment of intangible assets, amounting to $4,482. Fair value is defined under ASC 820, Fair Value Measurements and Disclosures as, “The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date”. The Company considered a number of valuation approaches and methods and applied the most appropriate methods from the income, and market approaches to derive an opinion of value. Under the income approach, the Company utilized the discounted cash flow method, and under the market approach, consideration was given to the guideline public company method, the merger and acquisition method, and the market capitalization method.

Other Intangible Assets

The following is a reconciliation of the changes to the Company's carrying amount of intangible assets for the period ended December 31, 2011 and the year ended March 31, 2011:

				Tradename/
	Software			Trademark		Total
Balance at March 31, 2011, net	$	893		$	2,473	$	3,366
Amortization		(173	)		-		(173	)
Balance at December 31, 2011, net	$	720		$	2,473	$	3,193

The components of intangible assets as at December 31, 2011 and March 31, 2011 were as follows:

	As of December 31, 2011
			Accumulated
	Cost		Amortization			Net
			(in thousands)
Software	$	1,611	$	(891	)	$	720
Tradename/Trade mark		2,473		-			2,473
Customer list		1,220		(1,220	)		-
License agreements		443		(443	)		-
	$	5,747	$	(2,554	)	$	3,193

	As of March 31, 2011
			Accumulated
	Cost		Amortization			Net
			(in thousands)
Software	$	1,611	$	(718	)	$	893
Tradename/Trademark		2,473		-			2,473
Customer list		1,220		(1,220	)		-
License agreements		443		(443	)		-
	$	5,747	$	(2,381	)	$	3,366

The Company has included amortization of acquired intangible assets directly attributable to revenue-generating activities in cost of revenues. The Company has included amortization of acquired intangible assets not directly attributable to revenue-generating activities in operating expenses. The Company recorded amortization expense for continuing operations of $58 and $86, and $173 and $259 during the three and nine month periods ended December 31, 2011 and 2010, respectively, in cost of revenues; and amortization expense in the amount of $0 and $18, and $0 and $54 during the three and nine month periods ended December 31, 2011 and 2010, respectively, in operating expenses. During the three and nine month periods ended December 31, 2011 and 2010 the Company recorded amortization expense for discontinued operations in the amount of $0 and $0, and $0 and $26, respectively, in cost of revenues; and amortization expense in the amount of $0 and $0, and $0 and $40, respectively, in operating expenses.

Based on the amortizable intangible assets as of December 31, 2011, we estimate amortization expense for the next four years to be as follows:

For the twelve months ending December 31,	Amortization Expense
	(in thousands)
2012		232
2013		232
2014		232
2015		24
	$	720

- 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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Mandalay Digital Group, Inc. - FORM 10-Q - XML - IDEA: XBRL DOCUMENT - February 24, 2012

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