Annual report pursuant to Section 13 and 15(d)

Intangible Assets

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Intangible Assets
 12 Months Ended
Dec. 31, 2013
Intangible Assets  
Note 5. Intangible Assets

The Company’s intangible assets consist of intellectual property, principally patents. The patents are being amortized over their remaining lives, which are 10 years and 17 years.

 

 
 
 
 		  
 
 
 		  
 
 
Cost 		 
 
 
 		  
 
 
 		  
 
Accumulated
Amortization 		 
 
 
 		  
 
 
 		 December 31,
2012
Net Carrying
Value 		 
 
 
 
    $     $     $  
                         
Patents     1,666,346       236,108       1,430,238  
                         
      1,666,346       236,108       1,430,238  

 

 
 
 
 		  
 
 
 		  
 
 
Cost 		 
 
 
 		  
 
 
 		  
 
Accumulated
Amortization 		 
 
 
 		  
 
 
 		 December 31,
2013
Net Carrying
Value 		 
 
 
 
    $     $     $  
                         
Patents     1,314,559       312,516       1,002,043  
                         
      1,314,559       312,516       1,002,043  

 

During the year ended December 31, 2013 and 2012, the Company recognized $114,879 and $112,056 in amortization expense respectively. During the year ended December 31, 2013 the Company also recognized impairment losses of $350,000. No impairment losses were recognized during the year ended December 31, 2012.

 

The Company amortizes the long-lived assets on a straight line basis with terms ranging from 13 to 20 years. The annual estimated amortization schedule over the next five years is as follows:

 

2014   $ 98,158  
2015   $ 98,158  
2016   $ 98,158  
2017   $ 98,158  
2018   $ 98,158  

 

The Company periodically reviews its long lived assets to ensure that their carrying value does not exceed their fair market value. The Company carried out such a review in accordance with ASC 360 as of December 31, 2013. The result of this review confirmed that the fair value of the patents exceeded their carrying value as of December 31, 2013.