Tucows 2015 Annual Report Download - page 93

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AMORTIZATION OF INTANGIBLE ASSETS
Year ended December 31,
2015 2014
Amortization of intangible assets $ 224,206 $ 596,620
Decrease over prior period $ (372,414)
Decrease - percentage (62)%
Percentage of net revenues 0% 0%
Amortization of intangible assets consists of amounts arising in connection with the acquisition of EPAG
Domainservices GmbH ("EPAG") in July 2011 and the acquisition of the BRI Group in February 2015. Amortization of
intangible assets decreased by $0.4 million to $0.2 million, primarily the result of intangible assets related to Innerwise,
Inc. being fully amortized in Fiscal 2014.
Network rights, brand and customer relationships acquired in connection with the acquisitions of EPAG and the
BRI Group are amortized on a straight-line basis over seven years.
Technology acquired in connection with the acquisition of EPAG is amortized on a straight-line basis over two
years.
IMPAIRMENT OF INDEFINITE LIFE INTANGIBLE ASSETS
Year ended December 31,
2015 2014
Impairment of indefinite life intangible assets $ 206,116 $ 577,145
(Decrease) increase over prior period $ (371,029)
Decrease - percentage (64)%
Percentage of net revenues 0% 0%
As part of our normal renewal process during Fiscal 2015 and Fiscal 2014, we assessed that certain domain names
acquired in the June 2006 acquisition of Mailbank.com Inc. should not be renewed and were allowed to expire.
Accordingly, these domain names, with a book value of $0.2 million and $0.6 million, respectively, have been written off
and recorded as impairment of indefinite life intangible assets.
LOSS ON CURRENCY FORWARD CONTRACTS
Although our functional currency is the U.S. dollar, a major portion of our fixed expenses are incurred in
Canadian dollars. Our goal with regard to foreign currency exposure is, to the extent possible, to achieve operational cost
certainty, manage financial exposure to certain foreign exchange fluctuations and to neutralize some of the impact of
foreign currency exchange movements. Accordingly, we enter into foreign exchange contracts to mitigate the exchange
rate risk on portions of our Canadian dollar exposure.
Year ended December 31,
2015 2014
Loss on currency forward contracts $ 792,900 $ 357,760
Increase over prior period $ 435,140
Increase - percentage 122%
Percentage of net revenues 0% 0%
We have entered into certain forward exchange contracts that do not comply with the requirements of hedge
accounting to meet a portion of our future Canadian dollar requirements through December 2016. The impact of the fair
value adjustment on outstanding contracts for Fiscal 2015 was a net loss of $1.0 million compared to $0.1 million for
Fiscal 2014. The impact of the fair value adjustment on outstanding contracts was increased by a realized gain upon
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