Property, Equipment and Software
|12 Months Ended|
Dec. 31, 2015
|Property, Plant and Equipment [Abstract]|
|Property, Equipment and Software||
Property, Equipment, and Software
Property, equipment, and software consisted of the following at December 31, 2015 and 2014:
Depreciation and amortization expense for property, equipment, and purchased software was $20.6 million, $18.9 million, and $14.1 million for the years ended December 31, 2015, 2014, and 2013, respectively. These amounts include depreciation of assets acquired through capital leases.
The carrying amount of capitalized software development costs was $41.2 million and $32.5 million and had accumulated amortization of $14.0 million and $10.7 million at December 31, 2015 and 2014, respectively. The weighted average amortization period for capitalized software development costs was 4.2 years at December 31, 2015. During the years ended December 31, 2015, 2014, and 2013, we capitalized $10.5 million, $10.9 million, and $7.6 million of software development costs. Amortization expense related to capitalized software development costs totaled $3.3 million, $1.7 million, and $1.0 million during the years ended December 31, 2015, 2014, and 2013, respectively.
We review in-progress software development projects on a periodic basis to ensure completion is assured and the development work will be placed into service as a new product or significant product enhancement. During the year ended December 31, 2015, we identified certain projects for which software development work had ceased and it was determined the projects would be discontinued. Our analysis of the capitalized costs resulted in the conclusion that they had no value outside of the respective projects for which they were originally incurred. As a result, we recognized an impairment loss of $1.4 million during the year ended December 31, 2015, related to these costs. The impairment charges are included in the "Product development" line in the accompanying Consolidated Statements of Operations. No impairments were recognized during 2014 or 2013.
During the year ended December 31, 2015, the Company modified or terminated certain operating lease agreements for office space prior to the end of the applicable lease term. We recognized an impairment charge of $1.5 million during the year ended December 31, 2015, related to leasehold improvements associated with a modified lease. The impairment charge is included in the line "General and administrative" in the accompanying Consolidated Statements of Operations. Related to these lease modifications, we also disposed of fixed assets with a net carrying value of $1.3 million during 2015, resulting in the recognition of a net loss on disposal of $0.2 million during the period. See additional discussion of the lease changes in Note 9.
The Company purchased a perpetual software license in December 2015 for $2.5 million that was capitalized and included as a component of property, equipment, and software for the year ended December 31, 2015. Subsequent to the purchase, we employed the owner of the development company that sold us the software. The Board of Directors approved the software purchase and the employee’s compensation package, which includes stock options and restricted stock awards. These awards and our valuation methodology are further described in Note 8, Stock-based Compensation.
The entire disclosure for long-lived, physical assets used in the normal conduct of business and not intended for resale. Includes, but is not limited to, accounting policies and methodology, roll forwards, depreciation, depletion and amortization expense, including composite depreciation, accumulated depreciation, depletion and amortization expense, useful lives and method used, income statement disclosures, assets held for sale and public utility disclosures.
Reference 1: http://www.xbrl.org/2003/role/presentationRef