Quarterly report pursuant to Section 13 or 15(d)

NOTE 5 - INTANGIBLE ASSETS

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NOTE 5 - INTANGIBLE ASSETS
3 Months Ended
Mar. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets Disclosure [Text Block]
NOTE 5 – INTANGIBLE ASSETS

Intangible assets consist of proprietary developed software, intellectual property, customer lists and acquired contracts carried at cost less accumulated amortization and customer lists acquired at fair value less accumulated amortization. Amortization is computed using the straight-line method over the estimated useful lives.

The components of intangible assets are as follows:

 
 
March 31, 2017
   
December 31, 2016
   
Estimated Useful Lives
 
Proprietary developed software
 
$
806,500
   
$
677,829
     
5
 
Intellectual property, customer list, and acquired contracts
   
3,069,551
     
3,069,551
     
5 - 15
 
Total intangible assets
 
$
3,876,051
   
$
3,747,380
         
Less: accumulated amortization
   
(1,431,119
)
   
(1,316,269
)
       
 
 
$
2,444,932
   
$
2,431,111
         

Amortization expense included in depreciation and amortization was $114,850 for the three months ended March 31, 2017 as compared to $113,086 for the three months ended March 31, 2016. Included in proprietary developed software is $406,827 for the three months ended March 31, 2017 and $42,503 for the three months ended March 31. 2016 not yet in service. The Company expects the proprietary developed software to be placed in service in 2018, and has included the amortization in the future amortization schedule accordingly. 

The Company expects future amortization expense to be the following:

 
 
Amortization
 
Balance of 2017
 
$
242,005
 
2018
   
317,555
 
2019
   
317,555
 
2020
   
299,565
 
2021
   
263,015
 
thereafter
   
1,005,237
 
 
       
Total
 
$
2,444,932