Digital River 2001 Annual Report Download - page 37

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35
impairment testing; and effective January 1, 2002, goodwill from acquisitions initiated prior to July 1,
2001, is no longer subject to amortization.
These new Statements were applicable to the Company’s acquisitions of R egSoft.com, Orbit
Commerce, Inc., and Network Commerce, all of which occurred after the July 1 effective date for new
acquisitions. Accordingly, goodwill totaling $3,615,000 resulting from these acquisitions was not amortized
during 2001.The Company will adopt the provisions of SFAS No. 142 related to all other acquisitions
on January 1, 2002.The adoption of these statements is not expected to result in any transitional
goodwill impairment losses on our unamortized goodwill balances, which totaled $11,273,000 at
December 31, 2001, and for which we recorded amortization expense of $10,769,000 in the year
ended December 31, 2001. Other identified intangibles with determinable lives, which totaled
$8,934,000 at December 31, 2001, will continue to be amortized pursuant to the new standards.
In July 2001, the FASB issued SFAS No. 144,“Impairment or Disposal of Long-Lived Assets”, which
is effective for fiscal years beginning after December 15, 2001.The provisions of this statement provide
a single accounting model for impairment of long-lived assets.The Company anticipates that this new
standard will not have a material impact on its financial position or results of operations.
Management’s Discussion and Analysis of Financial Condition and R esults of O perations
Digital River 2001 Annual Report