Annual report pursuant to Section 13 and 15(d)

NOTE 5 - INTANGIBLE ASSETS

v3.8.0.1
NOTE 5 - INTANGIBLE ASSETS
12 Months Ended
Dec. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets Disclosure [Text Block]
NOTE 5 – INTANGIBLE ASSETS

Intangible assets consist of developed intellectual property 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:

 
 
December 31, 2017
   
December 31, 2016
   
Estimated Useful Lives
 
Proprietary developed software
 
$
1,192,109
   
$
677,829
   
5 – 7
 
Intellectual property, customer list, and acquired contracts
   
3,129,551
     
3,069,551
   
5 – 15
 
Total intangible assets
 
$
4,321,660
   
$
3,747,380
       
Less: accumulated amortization
   
(1,681,203
)
   
(1,316,269
)
     
 
 
$
2,640,457
   
$
2,431,111
       

Amortization expense related to the above intangible assets was $364,934 and $452,344, respectively, the years ended December 31, 2017 and 2016.

Included in proprietary developed software is $707,118 not yet in service and accordingly no amortization was recorded. The Company expects the proprietary developed software to be placed in service in 2018, and has included amortization in the future amortization schedule accordingly. On September 1, 2017 the Company paid $60,000 to an entity for its customer list.

The Company expects future amortization expense to be the following:

 
 
Amortization
 
 
     
2018
 
$
387,001
 
2019
   
387,001
 
2020
   
369,010
 
2021
   
332,460
 
2022
   
265,759
 
thereafter
   
899,226
 
Total
 
$
2,640,457