v2.4.0.8
Document and Entity Information Document
9 Months Ended
Sep. 30, 2013
Nov. 06, 2013
Document and Entity Information [Abstract]    
Entity Registrant Name EBIX INC  
Entity Central Index Key 0000814549  
Current Fiscal Year End Date --12-31  
Entity Filer Category Accelerated Filer  
Document Type 10-Q  
Document Period End Date Sep. 30, 2013  
Document Fiscal Year Focus 2013  
Document Fiscal Period Focus Q3  
Amendment Flag false  
Entity Common Stock, Shares Outstanding   37,989,379
v2.4.0.8
Condensed Consolidated Statements of Income (Unaudited) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Income Statement [Abstract]        
Operating revenue $ 50,293 $ 53,804 $ 153,863 $ 145,347
Operating expenses:        
Cost of services provided 10,136 9,500 30,385 27,686
Product development 6,625 7,102 20,384 17,188
Sales and marketing 4,024 4,346 11,763 12,454
General and administrative 8,448 9,679 26,672 24,700
Amortization and depreciation 2,459 2,469 7,459 6,571
Total operating expenses 31,692 33,096 96,663 88,599
Operating income 18,601 20,708 57,200 56,748
Interest income 159 88 343 365
Interest expense (318) (440) (961) (1,005)
Non-operating income (loss) - put options 93 414 (1,250) 676
Non-operating expense - securities litigation (4,226) 0 (4,226) 0
Foreign currency exchange gain (loss) (33) (536) (326) 1,759
Income before income taxes 14,276 20,234 50,780 58,543
Income tax expense (1,133) (2,162) (6,751) (6,719)
Net income $ 13,143 $ 18,072 $ 44,029 $ 51,824
Basic earnings per common share $ 0.35 $ 0.49 $ 1.18 $ 1.41
Diluted earnings per common share $ 0.34 $ 0.46 $ 1.14 $ 1.32
Basic weighted average shares outstanding 37,919 37,214 37,435 36,859
Diluted weighted average shares outstanding 38,451 39,120 38,676 39,158
v2.4.0.8
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Statement of Comprehensive Income [Abstract]        
Net income $ 13,143 $ 18,072 $ 44,029 $ 51,824
Other comprehensive income (loss):        
Foreign currency translation adjustments 1,670 1,196 (2,426) (2,182)
Total other comprehensive income (loss) 1,670 1,196 (2,426) (2,182)
Comprehensive income $ 14,813 $ 19,268 $ 41,603 $ 49,642
v2.4.0.8
Condensed Consolidated Balance Sheets (Unaudited) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2013
Dec. 31, 2012
Current assets:    
Cash and cash equivalents $ 36,889 $ 36,449
Short-term investments 829 971
Trade accounts receivable, less allowances of $1,793 and $1,157, respectively 40,374 37,298
Deferred tax asset, net 1,442 1,835
Other current assets 4,941 5,116
Total current assets 84,475 81,669
Property and equipment, net 8,819 10,082
Goodwill 337,403 326,748
Intangibles, net 52,668 52,591
Indefinite-lived intangibles 30,887 30,887
Deferred tax asset, net 15,375 11,245
Other assets 3,733 3,724
Total assets 533,360 516,946
Current liabilities:    
Accounts payable and accrued liabilities 13,698 15,497
Accrued payroll and related benefits 4,029 5,431
Short term debt 12,719 11,344
Current portion of long term debt and capital lease obligations, net of discount of $20 and $13, respectively 828 915
Current deferred rent 237 237
Contingent liability for accrued earn-out acquisition consideration 4,168 3,265
Estimated Litigation Liability, Current 4,226 0
Derivative Liabilities, Current 2,437 0
Deferred revenue 17,365 19,888
Other current liabilities 118 113
Total current liabilities 59,825 56,690
Revolving line of credit 22,840 37,840
Long term debt and capital lease obligations, less current portion, net of discount of $38 and $78, respectively 22,948 31,592
Other liabilities 9,755 6,429
Contingent liability for accrued earn-out acquisition consideration 10,067 14,230
Put option liability 0 1,186
Deferred revenue 224 375
Long term deferred rent 2,239 1,449
Total liabilities 127,898 149,791
Commitments and Contingencies      
Temporary equity, Note 10 5,000 5,000
Stockholders’ equity:    
Preferred stock, $0.10 par value, 500,000 shares authorized, no shares issued and outstanding at September 30, 2013 and December 31, 2012 0 0
Common stock, $0.10 par value, 60,000,000 shares authorized, 38,029,530 issued and 37,989,021 outstanding at September 30, 2013 and 37,131,777 issued and 37,091,268 outstanding at December 31, 2012 3,799 3,709
Additional paid-in capital 163,754 164,346
Treasury stock (40,509 shares as of September 30, 2013 and December 31, 2012) (76) (76)
Retained earnings 242,329 201,094
Accumulated other comprehensive loss (9,344) (6,918)
Total stockholders’ equity 400,462 362,155
Total liabilities and stockholders’ equity $ 533,360 $ 516,946
v2.4.0.8
Condensed Consolidated Balance Sheets (Parentheticals) (USD $)
In Thousands, except Share data, unless otherwise specified
Sep. 30, 2013
Dec. 31, 2012
Statement of Financial Position [Abstract]    
Allowance for doubtful accounts $ 1,793 $ 1,157
Unamortized debt discount, current 20 13
Unamortized debt discount, noncurrent $ 38 $ 0
Preferred stock, par value (per share) $ 0.10 $ 0.10
Preferred stock, shares authorized 500,000 500,000
Preferred stock, shares issued 0 0
Preferred stock, shares outstanding 0 0
Common stock, par value (per share) $ 0.10 $ 0.10
Common stock, shares authorized 60,000,000 60,000,000
Common stock, shares issued 38,029,530 37,131,777
Common stock, shares outstanding 37,989,021 37,091,268
Treasury stock, shares 40,509 40,509
v2.4.0.8
Condensed Consolidated Statement of Stockholders' Equity (Unaudited) (USD $)
In Thousands, except Share data, unless otherwise specified
Total
Common Stock
Treasury Stock
Additional Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive Loss
Beginning Balance, Value at Dec. 31, 2012 $ 362,155 $ 3,709 $ (76) $ 164,346 $ 201,094 $ (6,918)
Beginning Balance, Issued Shares at Dec. 31, 2012 37,131,777 37,131,777        
Beginning Balance, Treasury Shares at Dec. 31, 2012     (40,509)      
Increase (Decrease) in Stockholders' Equity [Roll Forward]            
Net income 44,029       44,029  
Cumulative translation adjustment (2,426)         (2,426)
Repurchase and retirement of common stock, Shares   250,900        
Repurchase and retirement of common stock, Value 2,492 25   2,467    
Vesting of restricted stock, Shares   64,035        
Vesting of restricted stock, Value 0 7   (7)    
Exercise of stock options, Shares   1,150,380        
Exercise of stock options, Value 1,425 115   1,310    
Share based compensation 1,481     1,481    
Forfeiture of certain shares to satisfy exercise costs and the recipients income tax obligations related to stock options exercised and restricted stock vested, Shares (66,000) (65,762)        
Forfeiture of certain shares to satisfy exercise costs and the recipients income tax obligations related to stock options exercised and restricted stock vested (916) (7)   (909)    
Dividends paid (2,794)       (2,794)  
Ending Balance, Value at Sep. 30, 2013 $ 400,462 $ 3,799 $ (76) $ 163,754 $ 242,329 $ (9,344)
Ending Balance, Issued Shares at Sep. 30, 2013 38,029,530 38,029,530        
Ending Balance, Treasury Shares at Sep. 30, 2013     (40,509)      
v2.4.0.8
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Cash flows from operating activities:    
Net income $ 44,029 $ 51,824
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization 7,459 6,571
Benefit for deferred taxes (4,682) (605)
Share based compensation 1,481 1,567
Provision for doubtful accounts 1,361 416
Debt discount amortization on convertible debt 32 13
Unrealized foreign exchange (gain) loss (95) 397
(Gain) loss on put option 1,251 (677)
Reduction of acquisition earnout accruals (10,253) 0
Changes in assets and liabilities, net of effects from acquisitions:    
Accounts receivable (4,562) (1,859)
Other assets 845 (1,715)
Accounts payable and accrued expenses (2,568) 2,758
Accrued payroll and related benefits (1,205) (1,415)
Deferred revenue (2,802) (811)
Deferred rent (60) (92)
Other current liabilities 7,545 (2,370)
Net cash provided by operating activities 37,776 54,002
Cash flows from investing activities:    
Maturities of marketable securities 104 931
Purchases of marketable securities 0 (785)
Capital expenditures (887) (1,468)
Net cash used in investing activities (8,500) (58,922)
Cash flows from financing activities:    
Repayments on revolving line of credit, (net of proceeds) (15,000) 6,090
Proceeds from term loan 0 45,000
Principal payments of term loan obligation (6,531) (17,062)
Repurchases of common stock (2,492) (15,150)
Excess tax benefit from share-based compensation 0 73
Proceeds from the exercise of stock options 1,425 739
Forfeiture of certain shares to satisfy exercise costs and the recipients income tax obligations related to stock options exercised and restricted stock vested (916) 0
Dividend payments (2,794) (5,161)
Principal payments of debt obligations (636) (600)
Payments of capital lease obligations (221) (229)
Net cash provided by/ (used in) financing activities (27,165) 13,700
Effect of foreign exchange rates on cash (1,671) (2,985)
Net change in cash and cash equivalents 440 5,795
Cash and cash equivalents at the beginning of the period 36,449 23,696
Cash and cash equivalents at the end of the period 36,889 29,491
Supplemental disclosures of cash flow information:    
Interest paid 901 929
Income taxes paid 13,009 6,308
Taimma [Member]
   
Cash flows from investing activities:    
Acquisition of business, net of cash acquired 0 (5,003)
Investment in acquisition (2,250) 0
Qatarlyst [Member]
   
Cash flows from investing activities:    
Acquisition of business, net of cash acquired (4,740) 0
MCN [Member]
   
Cash flows from investing activities:    
Investment in acquisition 0 (1,537)
BSI [Member]
   
Cash flows from investing activities:    
Acquisition of business, net of cash acquired 0 (992)
Fintechnix [Member]
   
Cash flows from investing activities:    
Acquisition of business, net of cash acquired 0 (4,713)
Planetsoft [Member]
   
Cash flows from investing activities:    
Acquisition of business, net of cash acquired 0 (34,078)
USIX [Member]
   
Cash flows from investing activities:    
Investment in acquisition (727) 0
Curepet, Inc. [Member]
   
Cash flows from investing activities:    
Investment in business $ 0 $ (2,000)
v2.4.0.8
Condensed Consolidated Statements of Cash Flows (Unaudited) Supplemental schedule of noncash financing activities (Details) (USD $)
0 Months Ended
Jun. 02, 2012
Planetsoft [Member]
Business Acquisition, Cost of Acquired Entity $ 40,000,000
Share subscribed for business acquisition, Value $ 5,000,000
Business acquisition, number of common shares issued 296,560
v2.4.0.8
Description of Business and Summary of Significant Accounting Policies
9 Months Ended
Sep. 30, 2013
Accounting Policies [Abstract]  
Description of Business and Summary of Significant Accounting Policies
Description of Business and Summary of Significant Accounting Policies
Description of Business— Ebix, Inc. and subsidiaries (“Ebix” or the “Company”) is an international supplier of on-demand software and e-commerce solutions to the insurance industry. Ebix provides various application software products for the insurance industry ranging from data exchanges, carrier systems, and agency systems, to custom software development for business entities across the insurance industry. The Company's products feature fully customizable and scalable on-demand software designed to streamline the way insurance professionals manage distribution, marketing, sales, customer service, and accounting activities. The Company has its headquarters in Atlanta, Georgia and also conducts operating activities in Australia, Canada, China, India, Japan, New Zealand, Singapore, United Kingdom and Brazil. International revenue accounted for 31.5% and 29.1% of the Company’s total revenue for the nine months ended September 30, 2013 and 2012, respectively.
The Company’s revenues are derived from four product/service groups. Presented in the table below is the breakout of our revenue streams for each of those product/service groups for the three and nine months ended September 30, 2013 and 2012.

 
 
Three Months Ended
 
Nine Months Ended
 
 
September 30,
 
September 30,
(dollar amounts in thousands)
 
2013
 
2012
 
2013
 
2012
Exchanges
 
$
40,554

 
$
43,592

 
$
122,741

 
$
116,420

Broker Systems
 
4,390

 
4,537

 
13,878

 
13,713

Business Process Outsourcing (“BPO”)
 
3,604

 
4,252

 
11,781

 
11,713

Carrier Systems
 
1,745

 
1,423

 
5,463

 
3,501

Totals
 
$
50,293

 
$
53,804

 
$
153,863

 
$
145,347


Summary of Significant Accounting Policies
Basis of Presentation—The accompanying unaudited condensed consolidated financial statements and these notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") and in accordance with U.S. Generally Accepted Accounting Principles ("GAAP") with the effect of inter-company balances and transactions eliminated. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP and SEC rules have been condensed or omitted as permitted by and pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. These unaudited condensed consolidated financial statements contain adjustments (consisting only of normal recurring items) necessary to fairly present the consolidated financial position of the Company and its consolidated results of operations and cash flows. Operating results for the nine months ended September 30, 2013 and 2012 are not necessarily indicative of the results that may be expected for the full year. The condensed consolidated December 31, 2012 balance sheet included in this interim period filing has been derived from the audited financial statements at that date but does not include all of the information and related notes required by GAAP for complete financial statements. These condensed interim financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.
Fair Value of Financial Instrument—The Company follows the relevant GAAP guidance concerning fair value measurements which provides a consistent framework to define, measure, and disclose the fair value of assets and liabilities in financial statements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction. This guidance establishes a three-level hierarchy priority for disclosure of assets and liabilities recorded at fair value. The ordering of priority reflects the degree to which objective data from external active markets are available to measure fair value. The classification of assets and liabilities within the hierarchy is based on whether the inputs to the valuation methodology used for measurement are observable or unobservable.
Level 1 Inputs - Unadjusted quoted prices available in active markets for identical investments to the reporting entity at the measurement date
Level 2 Inputs - Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability.
Level 3 Inputs - Unobservable inputs, which are used to the extent that observable inputs are not available, and used in situations where there is little or no market activity for the asset or liability and wherein the reporting entity makes estimates and assumptions related to the pricing of the asset or liability including assumptions regarding risk.

     A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

As of September 30, 2013 the Company had the following financial instruments to which it had to consider fair values and had to make fair assessments:
Common share-based put option for which the fair value was measured as a Level 2 instrument.
Short-term investments for which the fair values are measured as a Level 1 instrument.
Contingent accrued earn-out business acquisition consideration liabilities for which fair values are measured as Level 3 instruments. These contingent consideration liabilities were recorded at fair value on the acquisition date and are remeasured quarterly based on the then assessed fair value and adjusted if necessary. The increases or decreases in the fair value of contingent consideration payable can result from changes in anticipated revenue levels and changes in assumed discount periods and rates. As the fair value measure is based on significant inputs that are not observable in the market, they are categorized as Level 3.

Other financial instruments not measured at fair value on the Company's unaudited consolidated balance sheet at September 30, 2013 but which require disclosure of their fair values include: cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, accrued payroll and related benefits, capital lease obligations, and debt under the revolving line of credit and term loans with Citibank. The estimated fair value of such instruments at September 30, 2013 approximates their carrying value as reported on the unaudited consolidated balance sheet.
Additional information regarding the Company's assets and liabilities that are measured at fair value on a recurring basis is presented in the following table:

 
 
Fair Values at Reporting Date Using*
Descriptions
 
Balance, September 30, 2013
Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)
Significant Other Observable Inputs (Level 2)
Significant Unobservable Inputs (Level 3)
 
 
(In thousands)
Assets
 
 
 
 
 
Available-for-sale securities:
 
 
 
 
 
Commercial bank certificates of deposits
 
$
829

$
829

$

$

Total assets measured at fair value
 
$
829

$
829

$

$

 
 
 
 
 
 
Liabilities
 
 
 
 
 
Derivatives:
 
 
 
 
 
Common share-based put option (a)
 
$
2,437

$

$
2,437

$

Contingent accrued earn-out acquisition consideration (b)
 
14,235



14,235

Total liabilities measured at fair value
 
$
16,672

$

$
2,437

$
14,235

 
 
 
 
 
 
(a) In connection with the acquisition of PlanetSoft effective June 1, 2012, Ebix issued a put option to the PlanetSoft's three shareholders. The put option, which expires in June 2014, is exercisable during the thirty-day period immediately following the two-year anniversary date of the business acquisition, which if exercised would enable them to sell the underlying 296,560 shares of Ebix common stock they received as part of the purchase consideration, back to the Company at a price of $16.86 per share. A portion of the total purchase consideration was allocated to this put liability based on its initial fair value, which was determined to be $1.4 million using a Black-Scholes model. The inputs used in the valuation of the put option include term, stock price volatility, current stock price, exercise price, and the risk free rate of return.
(b) The income valuation approach is applied and the valuation inputs include the contingent payment arrangement terms, projected cash flows, rate of return, and probability assessments.
* During the nine months ended September 30, 2013 there were no transfers between fair value Levels 1, 2 or 3.

    
For the Company's assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3), the following table provides a reconciliation of the beginning and ending balances for each category therein, and gains or losses recognized during the nine months ending September 30, 2013:
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
 
 
Contingent Liability for Accrued Earn-out Acquisition Consideration
 
 
(in thousands)
 
 
 
Beginning balance at January 1, 2013
 
$
17,495

 
 
 
Total remeasurement adjustments:
 
 
       (Gains) or losses included in earnings **
 
(10,253
)
       Foreign currency translation adjustments ***
 
545

 
 
 
Acquisitions and settlements
 
 
       Business acquisitions
 
9,425

       Settlements
 
(2,977
)
 
 
 
Ending balance at September 30, 2013
 
$
14,235

 
 
 
The amount of total (gains) or losses for the nine months ended September 30, 2013 included in earnings or changes to net assets, attributable to changes in unrealized (gains) or losses relating to assets or liabilities still held at quarter-end.
 
$
(10,298
)
 
 
 
** recorded as an adjustment to reported general and administrative expenses
*** recorded as a component of other comprehensive income within stockholders' equity


Quantitative Information about Level 3 Fair Value Measurements
The significant unobservable inputs used in the fair value measurement of the Company's contingent consideration liabilities designated as Level 3 are as follows:
  
 
 
 
 
 
 
(in thousands)
 
Fair Value at September 30, 2013
 
             Valuation Technique
 
Significant Unobservable
Input
Contingent acquisition consideration:
(Taimma, Planetsoft, TriSystems, and Qatarlyst acquisitions)
 
$14,235
 
Discounted cash flow
 
Projected revenue and probability of achievement




Sensitivity to Changes in Significant Unobservable Inputs
As presented in the table above, the significant unobservable inputs used in the fair value measurement of contingent consideration related to business acquisitions are projected revenue forecasts developed by the Company's management and the probability of achievement of those revenue forecasts. The discount rate used in these calculations is 1.75%. Significant increases (decreases) in these unobservable inputs in isolation would result in a significantly (lower) higher fair value measurement.
Revenue Recognition—The Company derives its revenues primarily from subscription and transaction fees pertaining to services delivered over our exchanges or from our ASP platforms, fees for business process outsourcing services, and fees for software development projects including associated fees for consulting, implementation, training, and project management provided to customers with installed systems. Sales and value-added taxes are not included in revenues, but rather are recorded as a liability until the taxes assessed are remitted to the respective taxing authorities.
In accordance with Financial Accounting Standard Board (“FASB”) and SEC accounting guidance on revenue recognition, the Company considers revenue earned and realizable when: (a) persuasive evidence of the sales arrangement exists, provided that the arrangement fee is fixed or determinable, (b) delivery or performance has occurred, (c) customer acceptance has been received, if contractually required, and (d) collectability of the arrangement fee is probable. The Company uses signed contractual agreements as persuasive evidence of a sales arrangement. We apply the provisions of the relevant generally accepted accounting principles related to all transactions involving the license of software where the software deliverables are considered more than inconsequential to the other elements in the arrangement.
For contracts that contain multiple deliverables, we analyze the revenue arrangements in accordance with the relevant technical accounting guidance, which provides criteria governing how to determine whether goods or services that are delivered separately in a bundled sales arrangement should be considered as separate units of accounting for the purpose of revenue recognition. Generally these types of arrangements include deliverables pertaining to software licenses, system set-up, and professional services associated with product customization or modification. Delivery of the various contractual elements typically occurs over periods of less than eighteen months. These arrangements generally do not have refund provisions or have very limited refund terms.
Software development arrangements involving significant customization, modification or production are accounted for in accordance with the appropriate technical accounting guidance issued by FASB using the percentage-of-completion method. The Company recognizes revenue using periodic reported actual hours worked as a percentage of total expected hours required to complete the project arrangement and applies the percentage to the total arrangement fee.
Accounts Receivable and the Allowance for Doubtful Accounts Receivable—Reported accounts receivable include $30.7 million of trade receivables stated at invoice billed amounts net of the estimated allowance for doubtful accounts receivable in the amount of $1.8 million, and $9.7 million of unbilled receivables. The unbilled receivables primarily relate to certain percentage-of-completion contracts and represents earnings in excess of contractual billings. Approximately $5.9 million deferred revenue is included in billed accounts receivable at September 30, 2013. The Company recognized and recorded bad debt expense in the amount of $834 thousand and $1.4 million for the three and nine-month periods ended September 30, 2013 and $100 thousand and $416 thousand for the three and nine-month periods ended September 30, 2012, respectively. The increase in bad debt expense that was recognized during the recent quarterly period pertained to significant increases in the aging of certain specific customer receivable accounts within the Company’s Exchange channel and a specific reserve for a portion of the outstanding balance due from CurePet, Inc. Accounts receivable are written off against the allowance account when the Company has exhausted all reasonable collection efforts.
Goodwill and Other Indefinite-Lived Intangible Assets—Goodwill represents the cost in excess of the fair value of the net assets of acquired businesses. Indefinite-lived intangible assets represent the fair value of acquired contractual customer relationships for which future cash flows are expected to continue indefinitely. In accordance with the relevant FASB accounting guidance, goodwill and indefinite-lived intangible assets are not amortized but are tested for impairment at the reporting unit level on an annual basis or on an interim basis if an event occurs or circumstances change that would likely have reduced the fair value of a reporting unit below its carrying value. Potential impairment indicators include a significant change in the business climate, legal factors, operating performance indicators, competition, and the sale or disposition of a significant portion of the business. The impairment evaluation process involves an assessment of certain qualitative factors to determine whether the existence of events or circumstances would indicate that it is more likely than not that the fair value of any of our reporting units was less than its carrying amount. If after assessing the totality of events or circumstances, we were to determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then the Company would not perform the two-step quantitative impairment testing described further below.
The aforementioned two-step quantitative testing process involves comparing the reporting unit carrying values to their respective fair values; we determine fair value of our reporting units by applying the discounted cash flow method using the present value of future estimated net cash flows. If the fair value of a reporting unit exceeds its carrying value, then no further testing is required. However, if a reporting unit's fair value were to be less than its carrying value, we would then determine the amount of the impairment charge, if any, which would be the amount that the carrying value of the reporting unit's goodwill exceeded its implied value. Projections of cash flows are based on our views of growth rates, operating costs, anticipated future economic conditions and the appropriate discount rates relative to risk and estimates of residual values. We believe that our estimates are consistent with assumptions that marketplace participants would use in their estimates of fair value. The use of different estimates or assumptions for our projected discounted cash flows (e.g., growth rates, future economic conditions, discount rates and estimates of terminal values) when determining the fair value of our reporting units could result in different values and may result in a goodwill impairment charge. We perform our annual goodwill impairment evaluation and testing as of September 30th of each year. This evaluation is done during the fourth quarter each year. During the year ended December 31, 2012 we had no impairment of our reporting unit goodwill balances.
Changes in the carrying amount of goodwill for the nine months ended September 30, 2013 are reflected in the following table. Goodwill increased during this period due to one business acquisition that was made in April.

 
September 30, 2013
 
(In thousands)
Beginning Balance at January 1, 2013
$
326,748

Additions
11,136

Foreign currency translation adjustments
(481
)
Ending Balance at September 30, 2013
$
337,403


Finite-lived Intangible Assets—Purchased intangible assets represent the estimated acquisition date fair value of customer relationships, developed technology, trademarks and non-compete agreements obtained in connection with the businesses we acquire. We amortize these intangible assets on a straight-line basis over their estimated useful lives, as follows:

Category
 
Life (yrs)
Customer relationships
 
7-20
Developed technology
 
3–12
Trademarks
 
3–15
Non-compete agreements
 
5
Database
 
10

The carrying value of finite-lived and indefinite-lived intangible assets at September 30, 2013 and December 31, 2012 are as follows:

 
September 30,
2013
 
December 31,
2012
 
(In thousands)
Finite-lived intangible assets:
 
 
 
Customer relationships
$
62,445

 
$
57,638

Developed technology
14,635

 
14,025

Trademarks
2,637

 
2,638

Non-compete agreements
538

 
538

Backlog
140

 
140

Database
212

 
212

Total intangibles
80,607

 
75,191

Accumulated amortization
(27,939
)
 
(22,600
)
Finite-lived intangibles, net
$
52,668

 
$
52,591

 
 
 
 
Indefinite-lived intangibles:
 
 
 
Customer/territorial relationships
$
30,887

 
$
30,887


Amortization expense recognized in connection with acquired intangible assets was $1.9 million and $5.4 million for the three and nine months ended September 30, 2013, respectively, and $1.4 million and $4.3 million for the three and nine months ended September 30, 2012, respectively.
Foreign Currency Translation—Historically the functional currency for the Company's foreign subsidiaries in India and Singapore had been the Indian rupee and Singapore dollar, respectively. As a result of the Company's rapid growth, the expansion of its intellectual property research and development activities in its Singapore subsidiary, and its product development activities and information technology enabled services for the insurance industry provided by its India subsidiary in support of Ebix's operating divisions across the world (both of which are transacted in U.S. dollars), management undertook a reconsideration of functional currency designations for these two foreign subsidiaries in India and Singapore, and concluded that effective July 1, 2012 the functional currency for these entities should be changed to the U.S. dollar. The Company believes that the acquisition of PlanetSoft along with other business acquisitions completed in 2012, combined with the cumulative effect of business acquisitions made over the last few years which in turn necessitated the rapid growth of the Company's operations in India and Singapore, were the primary economic facts and circumstances that justified the reconsideration and ultimate change in the functional currency.
The functional currency of the Company's other foreign subsidiaries is the local currency of the country in which the subsidiary operates. The assets and liabilities of these foreign subsidiaries are translated into U.S. dollars at the rates of exchange at the balance sheet dates. Income and expense accounts are translated at the average exchange rates in effect during the period. Gains and losses resulting from translation adjustments are included as a component of accumulated other comprehensive income in the accompanying consolidated balance sheets, and are included in the condensed consolidated statements of comprehensive income. Foreign exchange transaction gains and losses that are derived from transactions denominated in a currency other than the subsidiary's functional currency are included in the determination of net income.
Income Taxes—Deferred income taxes are recorded to reflect the estimated future tax effects of differences between the financial statement and tax basis of assets, liabilities, operating losses, and tax credit carry forwards using the tax rates expected to be in effect when the temporary differences reverse. Valuation allowances, if any, are recorded to reduce deferred tax assets to the amount management considers more likely than not to be realized. Such valuation allowances are recorded for the portion of the deferred tax assets that are not expected to be realized based on the levels of historical taxable income and projections for future taxable income over the periods in which the temporary differences will be deductible.
The Company also applies FASB accounting guidance on accounting for uncertainty in income taxes positions. This guidance clarifies the accounting for uncertainty in income taxes by prescribing the minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. In this regard we recognize the tax benefit from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position.
Recent Relevant Accounting Pronouncements—The following is a brief discussion of recently released accounting pronouncements that are pertinent to the Company's business:

In July 2013, the FASB issued Accounting Standards Update No. 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists". This accounting standard states that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. This accounting standards update applies to all entities that have unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. The accounting standards update is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The amendments should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. The Company will adopt this new standard in 2014, and it may have an affect on how unrecognized tax benefits are accounted for and presented in the Company's balance sheet.
    
In July 2012, the FASB issued Accounting Standards Update No. 2012-02, "Testing Indefinite-Lived Intangible Assets for Impairment" (the revised standard). The revised standard is intended to reduce the cost and complexity of testing indefinite-lived intangible assets other than goodwill for impairment. It allows companies to perform a qualitative assessment to determine whether further impairment testing of indefinite-lived intangible assets is necessary, similar in approach to the goodwill impairment test. The revised standard is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. Early adoption is permitted. The Company will adopt this new standard in 2013 for use in its annual impairment evaluations of indefinite-lived intangible assets, which are performed as of September of each year.


v2.4.0.8
Earnings per Share
9 Months Ended
Sep. 30, 2013
Earnings Per Share [Abstract]  
Earnings Per Share
Earnings per Share

A reconciliation between basic and diluted earnings per share is as follows (in thousands, except per share data):

 
Three Months Ended
 
Nine Months Ended
 
September 30,
 
September 30,
 
2013
 
2012
 
2013
 
2012
 
(In thousands, except per share data)
Net income for basic and diluted earnings per share
$
13,143

 
$
18,072

 
$
44,029

 
$
51,824

Basic Weighted Average Shares Outstanding
37,919

 
37,214

 
37,435

 
36,859

Dilutive effect of stock options and restricted stock awards
532

 
1,906

 
1,241

 
2,299

Diluted weighted average shares outstanding
38,451

 
39,120

 
38,676

 
39,158

Basic earnings per common share
$
0.35

 
$
0.49

 
$
1.18

 
$
1.41

Diluted earnings per common share
$
0.34

 
$
0.46

 
$
1.14

 
$
1.32



v2.4.0.8
Business Combinations
9 Months Ended
Sep. 30, 2013
Business Combinations [Abstract]  
Business Combinations
Business Combinations
    The Company executes accretive business acquisitions in combination with organic growth initiatives as part of its comprehensive business growth and expansion strategy. The Company looks to acquire businesses that are complementary to Ebix's existing products and services. Since June 1, 2012 the Company has completed four business acquisitions including PlanetSoft, Inc. which is considered significant and is discussed further below.
A significant component of the purchase price consideration for many of the Company's business acquisitions is a potential future cash earnout based on reaching certain specified future revenue targets. The Company recognizes these potential obligations as contingent liabilities as reported on its Condensed Consolidated Balance Sheets. As discussed in more detail in Note 1, these contingent consideration liabilities are recorded at fair value on the acquisition date and are remeasured quarterly based on the then assessed fair value and adjusted if necessary. During the three and nine months ended September 30, 2013 these aggregate contingent accrued earn-out business acquisition consideration liabilities, were reduced by $4.1 million and $10.3 million, respectively, due to remeasurements as based on the then assessed fair value and changes in anticipated future revenue levels. As of September 30, 2013, the total of these contingent liabilities was $14.24 million, of which $10.07 million is reported in long-term liabilities, and $4.17 million is included in current liabilities in the Company's Condensed Consolidated Balance Sheet. As of December 31, 2012 the total of these contingent liabilities was $17.50 million, of which $14.23 million is reported in long-term liabilities, and $3.27 million is included in current liabilities in the Company's Condensed Consolidated Balance Sheet.
Consideration paid by the Company for the businesses it purchases is allocated to the assets and liabilities acquired based upon their estimated fair values as of the date of the acquisition. The excess of the purchase price over the estimated fair values of assets acquired and liabilities assumed is recorded as goodwill. Recognized goodwill pertains to the value of the expected synergies to be derived from combining the operations of the businesses we acquire including the value of the acquired workforce.
During the nine months ended September 30, 2012 the Company received a termination fee in connection with a failed business acquisition. In this regard the Company recorded a reduction to general and administrative expense in the approximate amount of $971 thousand (net of directly related internal operating costs incurred by the Company and a portion of the fee that was paid to our investment banker).
Effective June 1, 2012 Ebix closed the merger of California based PlanetSoft, Inc. ("PlanetSoft"). Under the terms of the merger agreement the former PlanetSoft shareholders received $35.0 million cash and 296,560 shares of Ebix common stock valued at $16.86 per share or $5.0 million in the aggregate. Furthermore, under the terms of the agreement the PlanetSoft shareholders were granted a put option exercisable during the thirty-day period immediately following the two-year anniversary date of the business acquisition, which if exercised would enable them to sell the underlying shares of common stock back to the Company at a per-share value established on the effective date of the closing of Ebix's acquisition of PlanetSoft. The initial fair value of this put option liability was determined to be $1.4 million. This put option is described in more detail in Note 7. Included in the Company's revenues as reported in its condensed consolidated statement of income for the nine months ended September 30, 2013 is $12.4 million of PlanetSoft's operating revenue. The revenue derived from PlanetSoft's operations is included in the Company's Exchange division. The Company accounted for this acquisition by recording $44.1 million of goodwill, $9.8 million of intangible assets pertaining to customer relationships, and $540 thousand of intangible assets pertaining to acquired technology. The former shareholders of PlanetSoft retain the right to earn up to an additional cash consideration if certain incremental revenue targets are achieved over the two-year anniversary date subsequent to the effective date of the acquisition. The Company has determined that the approximate fair value of this contingent consideration liability to be $992 thousand as of September 30, 2013.

The aggregated unaudited pro forma financial information pertaining to all of the Company's acquisitions made during the nine months ending September 30, 2012 and September 30, 2013, which includes the acquisitions of BSI, Taimma, PlanetSoft, Fintechnix, TriSystems, and Qatarlyst as presented in the table below is provided for informational purposes only and does not project the Company's expected results of operations for any future period. No effect has been given in this pro forma information for future synergistic benefits that may still be realized as a result of combining these companies or costs that may yet be incurred in integrating their operations. The 2013 and 2012 pro forma financial information below assumes that all such business acquisitions were made on January 1, 2012, whereas the Company's reported financial statements for the three and nine months ended September 30, 2012 only include the operating results from the businesses since the effective date that they were acquired by Ebix.

 
Three Months Ending September 30, 2013
 
Three Months Ending September 30, 2012
 
Nine Months Ending September 30, 2013
 
Nine Months Ending September 30, 2012
 
As Reported
Pro Forma
 
As Reported
Pro Forma
 
As Reported
Pro Forma
 
As Reported
Pro Forma
 
(unaudited)
 
(unaudited)
 
(unaudited)
 
(unaudited)
 
(In thousands, except per share data)
Revenue
$
50,293

$
50,293

 
$
53,804

$
54,806

 
$
153,863

$
154,772

 
$
145,347

$
160,266

Net Income
$
13,143

$
13,143

 
$
18,072

$
14,886

 
$
44,029

$
42,721

 
$
51,824

$
42,002

Basic EPS
$
0.35

$
0.35

 
$
0.49

$
0.40

 
$
1.18

$
1.14

 
$
1.41

$
1.14

Diluted EPS
$
0.34

$
0.34

 
$
0.46

$
0.38

 
$
1.14

$
1.10

 
$
1.32

$
1.06




In the above table, the unaudited pro forma revenue for the three months ended September 30, 2013 decreased by $4.5 million from the unaudited pro forma revenue during the same period in 2012 of $54.8 million to $50.3 million , representing a 8.2% decrease. The pro forma revenue decrease was due to two reasons, first being exchange rate changes which resulted in a decrease of $1.6 million, and secondly a $1.3 million reduction in PlanetSoft professional service revenues due to implementations being delayed for a few clients. Correspondingly, the reported revenue for the three months ended September 30, 2013 decreased by $3.5 million or 6.5% from the reported revenue during the same period in 2012. The unaudited pro forma revenue for the nine months ended September 30, 2013 decreased by $5.5 million from the unaudited pro forma revenue during the same period in 2012 of $160.3 million to $154.8 million, representing a 3.4% decrease. Correspondingly, the reported revenue for the nine months ended September 30, 2013 increased by $8.5 million or 5.9% from the reported revenue during the same period in 2012.
v2.4.0.8
Debt with Commercial Bank
9 Months Ended
Sep. 30, 2013
Debt Disclosure [Abstract]  
Debt with Commercial Bank
Debt with Commercial Bank

On April 26, 2012, Ebix entered into a credit agreement providing for a $100 million secured syndicated credit facility (the “Secured Syndicated Credit Facility”) with Citibank, N.A. ("Citibank") as administrative agent and Citibank, Wells Fargo Capital Finance, LLC, and RBS Citizens, N.A. as joint lenders. The financing is comprised of a four-year, $45 million secured revolving credit facility, a $45 million secured term loan which amortizes over a four year period with quarterly principal and interest payments that commenced on June 30, 2012 and a final payment of all remaining outstanding principal and accrued interest due on April 26, 2016, and an accordion feature that provides for the expansion of the credit facility by an additional $10 million. This new $100 million credit facility with Citibank, as administrative agent, replaced the former $55 million facility that the Company had in place with Bank of America, N.A.  The initial interest rate applicable to the Secured Syndicated Credit Facility is LIBOR plus 1.50% or currently 1.68%. Under the Secured Syndicated Credit Facility the maximum interest rate that could be charged depending upon the Company's leverage ratio is LIBOR plus 2.00%. The credit facility is used by the Company to fund working capital requirements primarily in support of current operations, organic growth, and accretive business acquisitions. The Company incurred $744 thousand of origination costs in connection with this new credit facility, and is amortizing these costs into interest expense over the four-year life of the credit agreement. As of September 30, 2013 the Company's consolidated balance sheet includes $481 thousand of remaining deferred financing costs. The underlying financing agreement contains financial covenants regarding the Company's annualized EBITDA, fixed charge coverage ratio, and leverage ratio, as well as certain restrictive covenants pertaining to such matters as the incurrence of new debt, the aggregate amount of repurchases of the Company's equity shares, dividend payments, and the consummation of new business acquisitions. The Company currently is in compliance with all such financial and restrictive covenants.
    
At September 30, 2013, the outstanding balance on the revolving line of credit was $22.8 million and the facility carried an interest rate of 1.68%. During the nine months ended September 30, 2013, $15.0 million of payments were made against the revolving line of credit with Citibank.This balance is included in the long-term liabilities section of the Condensed Consolidated Balance Sheets. During the nine month period ending September 30, 2013, the average and maximum outstanding balances on the revolving line of credit were $33.3 million and $37.8 million, respectively.
    At September 30, 2013, the outstanding balance on the term loan was $34.3 million of which $12.7 million is due within the next twelve months. This term loan also carried an interest rate of 1.68%. During the nine months ended September 30, 2013, $6.5 million of scheduled payments were made against the existing term loan with Citibank. The current and long-term portions of the term loan are included in the respective current and long-term sections of the Condensed Consolidated Balance Sheets, the amounts of which were $12.7 million and $21.6 million respectively at September 30, 2013.
v2.4.0.8
Commitments and Contingencies
9 Months Ended
Sep. 30, 2013
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies
Commitments and Contingencies
Contingencies-Between July 14, 2011 and July 21, 2011, securities class action complaints were filed against the Company and certain of its officers in the United States District Court for the Southern District of New York and in the United States District Court for the Northern District of Georgia. The complaints assert claims against (i) the Company and the Company's CEO and CFO for alleged violations of Section 10(b) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 10b-5 promulgated thereunder and (ii) the Company's CEO and CFO as alleged controlling persons. The complaints generally allege false statements in earnings reports, SEC filings, press releases, and other public statements that allegedly caused the Company's stock to trade at artificially inflated prices. Plaintiffs seek an unspecified amount of damages.
The New York action has been transferred to Georgia and has been consolidated with the Georgia action, now styled In re: Ebix, Inc. Securities Litigation, Civil Action No. 1:11-CV-02400-RSW (N.D. Ga.). A Consolidated Amended Complaint (“CAC”) was filed by Plaintiffs on November 28, 2011. On January 12, 2012, the Company filed a Motion to Dismiss the CAC, which raised various defenses that the CAC failed to state a claim. On September 28, 2012, the Court entered an order denying the Company's Motion to Dismiss. On December 7, 2012, Plaintiffs filed their Motion for Class Certification. On June 19, 2013, Defendants filed a Motion for Judgment on the Pleadings, which is presently pending. On July 2, 2013, the Court denied Plaintiffs' Motion for Class Certification without prejudice to Plaintiffs' refiling their Motion should the Court deny, in whole or in part, Defendants' Motion for Judgment on the Pleadings. On July 16, 2013, the Court entered a Stipulated Order Staying Discovery Pending Resolution of Defendants' Motion for Judgment on the Pleadings.
In connection with this shareholder class action suit, there have been three derivative complaints brought by certain shareholders on behalf of the Company, which name certain of the Company's officers and its entire board of directors as Defendants. The first such derivative action was brought by an alleged shareholder named Paul Nauman styled Nauman v. Raina, et al., Civil Action File No. 2011-cv-205276 (Superior Court of Fulton County, Georgia), filed September 1, 2011. The second such derivative action was brought by an alleged shareholder named Gilbert Spagnola styled Spagnola v. Bhalla, et al., Civil action No. 1:13-CV-00062-RWS (N.D. Ga.), filed January 7, 2013. The third such derivative action was brought by an alleged shareholder named Hotel Trades Council and Hotel Association of New York City, Inc. Pension Fund styled Hotel Trades Council and Hotel Association of New York City, Inc. Pension Fund v. Raina, et al., Civil Action No. 1:13-CV-00246-RWS (N.D. Ga.), filed January 23, 2013. These derivative actions are based on substantially the same factual allegations in the shareholder class action suit, but also variously claim breach of fiduciary duties, abuse of control, gross mismanagement, the wasting of corporate assets, negligence, unjust enrichment by the Company's directors, and violation of Section 14 of the Exchange Act. The Nauman case has been stayed pending the completion of expert discovery in the shareholder class action suit. On April 12, 2013, the Court entered an Order consolidating the Spagnola and Hotel derivative cases under the style In re Ebix, Inc. Derivative Litigation, File No. 1:13-CV-00062- RWS (N.D. Ga.), appointing Hotel Trades Council and Hotel Association of New York City, Inc. Pension Fund as Lead Derivative Plaintiff, and appointing the law firm Cohen Milstein Sellers & Toll PLLC as Lead Derivative Counsel and The Law Offices of David A. Bain LLC as Liaison Counsel. Lead Derivative Plaintiff filed its Consolidated Shareholder Derivative and Class Action Complaint on May 20, 2013. Thereafter, the Court entered a Consent Order on June 4, 2013, setting a schedule for Lead Derivative Plaintiff to amend its Complaint in light of the anticipated preliminary proxy related to a proposed transaction announced on May 1, 2013 with affiliates of Goldman Sachs & Co. The parties are conferring regarding future case scheduling.
The Company denies any liability and intends to defend the federal and derivative actions vigorously. However management, after recent consultation with the Company’s outside advisors concluded that it was appropriate to record a contingent liability and recognize a charge against earnings in the amount of $4.23 million ($2.63 million net of the associated tax benefit), which represents our current estimate of the potential liability in regards to the federal class action matter. This contingent liability is reported in the current section of the enclosed Condensed Consolidated Balance Sheet, and the charge against earnings is reported below operating income in the enclosed Condensed Consolidated Statement of Income as of and for the three and nine months ended September 30, 2013.

On December 3, 2012, the Company received a subpoena and letter from the Securities and Exchange Commission (“SEC”) dated November 30, 2012, stating that the SEC is conducting a formal, non-public investigation styled In the Matter of Ebix, Inc. (A-3318) and seeking documents primarily related to the issues raised in the In re: Ebix, Inc. Securities Litigation. On April 16, 2013, the Company received a second subpoena from the SEC seeking additional documents. The Company is cooperating with the SEC to provide the requested documents.

On June 6, 2013, the Company was notified that the U.S Attorney for the Northern District of Georgia had opened an investigation into allegations of intentional misconduct that had been brought to its attention from the pending shareholder class action lawsuit against the Company's directors and officers, the media and other sources. The Company is cooperating with the U.S. Attorney's office.
Following our announcement on May 1, 2013 of the Company's execution of a merger agreement with affiliates of Goldman Sachs & Co., eleven putative class action complaints challenging the proposed merger were filed in the Delaware Court of Chancery.  These complaints name as Defendants some combination of the Company, its directors, Goldman Sachs & Co and affiliated entities.  On June 10, 2013, the eleven complaints were consolidated by the Delaware Court of Chancery under the caption In re Ebix, Inc. Stockholder Litigation, CA No. 8526-CS.  On June 19, 2013, the Company announced that the merger agreement had been terminated pursuant to a Termination and Settlement Agreement.  After Defendants moved to dismiss the consolidated proceeding, Lead Plaintiffs amended their operative complaint to drop their claims against Goldman Sachs & Co. and focus their allegations on an Acquisition Bonus Agreement between the Company and Robin Raina. On September 26, 2013, Defendants moved to dismiss the Amended Consolidated Complaint. The Court has set an agreed briefing schedule. The Company denies any liability and intends to defend the action vigorously.

The Company has been sued by Microsoft for alleged copyright infringement, breach of contract, and unjust enrichment. Microsoft Corporation and Microsoft Licensing GP v. Ebix, Inc., Case No. 1:13-CV-01655-CAP (N.D.Ga), filed May 15, 2013. Microsoft is seeking damages in excess of $75,000, but we have not yet been able to determine exposure as the case concerns alleged underlicensing of Microsoft software and an audit is underway. The Company filed a Motion to Dismiss on July 10, 2013. In response, Microsoft filed an Amended Complaint. The Company filed a Motion to Dismiss the Amended Complaint on August 29, 2013. That Motion has been fully briefed and is awaiting determination by the Court. The Company denies any liability and intends to defend the action vigorously.
In the normal course of business, the Company is involved in various other claims and legal actions arising in the ordinary course of business. In the opinion of management, the ultimate likely disposition of these matters will not have a material adverse effect on the Company's business, consolidated financial position, results of operations or liquidity.
Lease Commitments—The Company leases office space under non-cancelable operating leases with expiration dates ranging through 2019, with various renewal options. Capital leases range from three to five years and are primarily for computer equipment. There were multiple assets under various individual capital leases at September 30, 2013 and 2012. Rental expense for office facilities and certain equipment subject to operating leases for the nine months ended September 30, 2013 and 2012 was $4.9 million and $4.2 million, respectively.
Self Insurance—For most of the Company’s U.S. employees the Company is self-insured for its health insurance program and has a stop loss policy that limits the individual liability to $120 thousand per person and the aggregate liability to 125% of the expected claims based upon the number of participants and historical claims. As of September 30, 2013, the amount accrued on the Company’s Condensed Consolidated Balance Sheet for the self-insured component of the Company’s employee health insurance was $302 thousand. The maximum potential estimated cumulative liability for the annual contract period, which ends in September 2014, is $2.9 million.

v2.4.0.8
Income Taxes
9 Months Ended
Sep. 30, 2013
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes
The Company's consolidated world-wide effective tax rate reflects the tax benefits  of conducting operating activities in  certain foreign jurisdictions where earnings are taxed at rates lower than U.S. statutory rates and where certain components of the Company's income are exempt from taxation. Furthermore, the Company's world-wide product development operations and intellectual property ownership have been centralized into our India and Singapore subsidiaries. Our operations in India benefit from a tax holiday which will continue through 2015; and as such the income generated by our India operations, other than passive interest  income, is not taxed. After the tax holiday expires in 2015 the income generated by our India operations will be taxed at 50% of the normal 33.99% corporate tax rate for a period of five years. The Company also has a relatively low income tax rate in Singapore wherein our operations are taxed at a 10% marginal tax rate as a result of concessions granted by the local Singapore Economic Development Board for the benefit of in-country intellectual property owners. The concessionary 10% income tax rate will expire after 2015, at which time our Singapore operations will be subject to the prevailing corporate tax rate in Singapore, which is currently 17%, unless the Company reaches a subsequent agreement to extend the incentive period and the then applicable concessionary rate or possibly secure a lower concessionary tax rate.
The Company recognized total income tax expense in the amount of $6.75 million for the nine months ended September 30, 2013. The Company's interim period tax provision, exclusive of discrete items, for this nine month period during 2013 was an expense of $4.94 million which is reflective of an 8.98% effective tax rate, as compared to the 10.35% for the same period during 2012. The effective rate decreased primarily due to increased taxable income from jurisdictions with lower tax rates. The discrete items recognized during the nine months ending September 30, 2013 included a $1.6 million tax benefit to be realized in connection with the $4.2 million non-operating charge against earnings that was recorded in regards to the contingent loss recognized for certain securities litigation matters, and $3.4 million of additional tax expense recorded to increase the reserve for uncertain tax positions. The Company's interim period income tax provisions are based on an estimate of the effective income tax rate expected to be applicable to the corresponding annual period, after eliminating discrete items unique to the respective interim period being reported.
At September 30, 2013, the Company had remaining available domestic net operating loss (“NOL”) carry-forwards of approximately $50.8 million which are available to offset future federal and certain state income taxes. The Company reviews its NOL positions to validate that all NOL carry-forwards will be utilized before they begin to expire in 2020.
The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction, and various states and foreign jurisdictions. With the exception of NOL carry-forwards, the Company is no longer subject to U.S. federal or state tax examinations by tax authorities for years before 2007 due to the expiration of the statute of limitations. There is an open federal income tax audit for taxable years 2008 through 2011. In connection with this open audit, the Company has responded to a number of information requests from the IRS, but there has been no formal identification of potential deficiencies or assessments to date. Regarding our foreign operations as of December 31, 2012, the tax years that remain open and possibly subject to examination by the tax authorities in those jurisdictions are Australia (2006 to 2012), Singapore and Brazil (2007 to 2012), New Zealand (2008 to 2012), and India (2010 to 2012).
Accounting for Uncertainty in Income Taxes—The Company has applied the FASB’s accounting guidance on accounting for uncertain income tax positions. As of September 30, 2013 the Company’s Condensed Consolidated Balance Sheet includes a liability of $9.3 million for unrecognized tax benefits which is included in other long-term liabilities. During the nine months ended September 30, 2013 there were $3.4 million of additions to this liability reserve. A reconciliation of the beginning and ending amounts of the Company’s liability reserves for unrecognized tax benefits is as follows:
 
(in thousands)
Balance at January 1, 2013
$
5,925

Additions for tax positions related to current year
3,337

Additions for tax positions of prior years
68

Reductions for tax position of prior years

Balance, September 30, 2013
$
9,330


The Company recognizes interest accrued and penalties related to unrecognized tax benefits as part of income tax expense. As of September 30, 2013 approximately $833 thousand of estimated interest and penalties is also included in other long-term liabilities in the accompanying Condensed Consolidated Balance Sheet, and is part of the balance of the liability for unrecognized tax benefits in the above table.
v2.4.0.8
Derivative Instruments
9 Months Ended
Sep. 30, 2013
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments
Derivative Instruments
The Company periodically uses derivative instruments that are not designated as hedges under FASB accounting guidance related to the accounting for derivative instruments, to hedge the fluctuations in foreign exchange rates for recognized balance sheet items such as intercompany receivables. As of September 30, 2013, all of the Company's pre-existing foreign currency hedge contracts have matured. The inputs that were used in the valuation of the hedge contracts included the USD/INR foreign currency exchange spot rates in effect at the inception date of the contract, forward premiums, forward foreign currency exchange rates, terms, and contract maturity dates.
The intended purpose of these hedging instruments was to offset the income statement impact of recorded foreign exchange transaction gains and losses resulting from U.S. dollar denominated intercompany invoices issued by our Indian subsidiary whose functional currency had been the Indian rupee until it was changed to the U.S. dollar effective July 1, 2012. The change in the fair value of these derivatives was recorded in foreign currency exchange gains and losses in the Condensed Consolidated Statements of Income and was zero and $1.2 million for the nine months ended September 30, 2013 and 2012, respectively. These gains are in addition to the consolidated foreign exchange gains (losses) equivalent to $(326) thousand and $603 thousand recorded during the nine months ended September 30, 2013 and 2012, respectively, incurred by our subsidiaries for settlement of transactions denominated in other than their functional currency. The Company classifies its foreign currency hedges, for which the fair value is remeasured on a recurring basis at each reporting date, as a Level 2 instrument (i.e. wherein fair value is determined and based on observable inputs other than quoted market prices), which we believe is the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the measurement date. This disclosure specifically pertains to the hedging instruments outstanding at March 31, 2012, rather than the current year, in that as of September 30, 2013, all of the Company's pre-existing foreign currency hedge contracts have matured and there were no such other hedging instruments outstanding on this date.
    In connection with the acquisition of PlanetSoft effective June 1, 2012, Ebix issued a put option to PlanetSoft's three shareholders. The put option, which expires in June 2014, is exercisable during the thirty-day period immediately following the two-year anniversary date of the business acquisition, which if exercised would enable them to sell the underlying 296,560 shares of Ebix common stock they received as part of the purchase consideration, back to the Company at a price of $16.86 per share, which represents the per-share value established on the effective date of the closing of Ebix's acquisition of PlanetSoft. In accordance with the relevant authoritative accounting literature a portion of the total purchase consideration was allocated to this put liability based on its initial fair value, which was determined to be $1.4 million using a Black-Scholes model. The inputs used in the valuation of the put option include term, stock price volatility, current stock price, exercise price, and the risk free rate of return. At September 30, 2013 the fair value of the put option liability was re-measured and was determined to have increased $1.3 million during the nine month period then ended with this amount reflected as a loss included in other non-operating income (loss) in the accompanying Condensed Consolidated Statement of Income. As of September 30, 2013, the aggregate fair value of this derivative instrument, which is included in the current liabilities section on the Condensed Consolidated Balance Sheet, was $2.4 million. The Company has classified the put option, for which the fair value is re-measured on a recurring basis at each reporting date, as a Level 2 instrument (i.e. wherein fair value is partially determined and based on observable inputs other than quoted market prices), which we believe is the most appropriate level within the fair value hierarchy based on the inputs used to determine its fair value at the measurement date.
v2.4.0.8
Geographic Information
9 Months Ended
Sep. 30, 2013
Segment Reporting [Abstract]  
Geographic Information
Geographic Information
The Company operates with one reportable segment whose results are regularly reviewed by the Company's chief operating decision maker as to performance and allocation of resources. External customer revenues in the tables below are attributed to a particular country based on whether the customer had a direct contract with the Company which was executed in that particular country for the sale of the Company's products/services with an Ebix subsidiary located in that country.
The following enterprise wide information relates to the Company's geographic locations (all amounts in thousands):
As of and for the Nine Months Ended September 30, 2013
 
United States
 
Canada
 
Latin America
 
Australia
 
Singapore
 
New Zealand
 
India
 
Europe
 
Total
External Revenues
$
105,471

 
$
4,977

 
$
4,205

 
$
28,955

 
$
2,301

 
$
1,702

 
$
540

 
$
5,712

 
$
153,863

Long-lived assets
$
310,481

 
$
9,247

 
$
11,488

 
$
817

 
$
69,281

 
$
107

 
$
19,319

 
$
28,145

 
$
448,885


As of and for the Nine Months Ended September 30, 2012
 
United States
 
Canada
 
Latin America
 
Australia
 
Singapore
 
New Zealand
 
India
 
Europe
 
Total
External Revenues
$
103,086

 
$
4,207

 
$
6,266

 
$
27,039

 
$
2,165

 
$
1,624

 
$
147

 
$
813

 
$
145,347

Long-lived assets
$
320,124

 
$
9,290

 
$
12,908

 
$
1,542

 
$
71,180

 
$
245

 
$
10,422

 
$
13,696

 
$
439,407

v2.4.0.8
Minority Business Investment
9 Months Ended
Sep. 30, 2013
Investments, All Other Investments [Abstract]  
Minority Business Investment
Minority Business Investment

During the three months ending June 30, 2012, Ebix acquired a strategic 19.8% interest in CurePet, Inc. ("CurePet") for cash consideration in the amount of $2.0 million. CurePet's insurance exchange connects pet owners, referring veterinarians, animal hospitals, academic institutes, and suppliers of medical and general pet supplies, while providing a wide variety of services related to pet insurance to each constituent including practice management, electronic medical records, and billing. CurePet is also a customer of Ebix; during the three and nine month period ending September 30, 2013 the Company recognized $0 and $1.2 million of revenue from CurePet, respectively, and as of September 30, 2013 there was an $1.4 million outstanding balance due from CurePet in the Company's reported billed trade accounts receivable against which the Company has recognized a $683 thousand valuation reserve. Ebix also has a revenue share arrangement with CurePet pertaining to certain customer revenues recognized by CurePet; for the three and nine months ended September 30, 2013, there have been no revenue sharing earned or accrued.
v2.4.0.8
Temporary Equity
9 Months Ended
Sep. 30, 2013
Temporary Equity Disclosure [Abstract]  
Temporary Equity [Text Block]
Temporary Equity

The $5.0 million of temporary equity reported on the Company's condensed consolidated balance sheet as of September 30, 2013 and December 31, 2012 is in connection with the June 1, 2012 acquisition of PlanetSoft. As part of the consideration paid for PlanetSoft in accordance with terms of the merger agreement the former PlanetSoft shareholders received 296,560 shares of Ebix common stock valued at $16.86 per share or $5.0 million in the aggregate. In regard to these shares of Ebix common stock, and as discussed in Note 7 "Derivative Instruments," the Company issued a put option to PlanetSoft's three shareholders. The put option, which expires in June 2014, is exercisable during the thirty-day period immediately following the two-year anniversary date of the business acquisition, which if exercised would enable them to sell the underlying 296,560 shares of Ebix common stock they received as part of the purchase consideration, back to the Company at a price of $16.86 per share, which represents the per-share value established on the effective date of the closing of Ebix's acquisition of PlanetSoft. Furthermore as per the terms of the PlanetSoft merger agreement, if Ebix consummates a merger or acquisition agreement whereby it ceases to be a public reporting company as under the SEC Exchange Act, then the put option shall become immediately exercisable. Accordingly and in compliance with Accounting Standards Codification ("ASC") 480 "Accounting for Redeemable Equity Instruments," in that the common stock is redeemable for cash at the option of the holders, and not within control of the Company, it is presented outside of the stockholders equity section of the condensed consolidated balance sheet, and is shown as a separate line referred to as "temporary equity" appearing after liabilities, and before the stockholder's equity section, and will remain so until July 2014 when either exercised or lapsed.
v2.4.0.8
Description of Business and Summary of Significant Accounting Policies (Policies)
9 Months Ended
Sep. 30, 2013
Accounting Policies [Abstract]  
Basis of Presentation
Basis of Presentation—The accompanying unaudited condensed consolidated financial statements and these notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") and in accordance with U.S. Generally Accepted Accounting Principles ("GAAP") with the effect of inter-company balances and transactions eliminated. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP and SEC rules have been condensed or omitted as permitted by and pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. These unaudited condensed consolidated financial statements contain adjustments (consisting only of normal recurring items) necessary to fairly present the consolidated financial position of the Company and its consolidated results of operations and cash flows. Operating results for the nine months ended September 30, 2013 and 2012 are not necessarily indicative of the results that may be expected for the full year. The condensed consolidated December 31, 2012 balance sheet included in this interim period filing has been derived from the audited financial statements at that date but does not include all of the information and related notes required by GAAP for complete financial statements. These condensed interim financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.
Fair Value of Financial Instruments
Fair Value of Financial Instrument—The Company follows the relevant GAAP guidance concerning fair value measurements which provides a consistent framework to define, measure, and disclose the fair value of assets and liabilities in financial statements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction. This guidance establishes a three-level hierarchy priority for disclosure of assets and liabilities recorded at fair value. The ordering of priority reflects the degree to which objective data from external active markets are available to measure fair value. The classification of assets and liabilities within the hierarchy is based on whether the inputs to the valuation methodology used for measurement are observable or unobservable.
Level 1 Inputs - Unadjusted quoted prices available in active markets for identical investments to the reporting entity at the measurement date
Level 2 Inputs - Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability.
Level 3 Inputs - Unobservable inputs, which are used to the extent that observable inputs are not available, and used in situations where there is little or no market activity for the asset or liability and wherein the reporting entity makes estimates and assumptions related to the pricing of the asset or liability including assumptions regarding risk.

     A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

As of September 30, 2013 the Company had the following financial instruments to which it had to consider fair values and had to make fair assessments:
Common share-based put option for which the fair value was measured as a Level 2 instrument.
Short-term investments for which the fair values are measured as a Level 1 instrument.
Contingent accrued earn-out business acquisition consideration liabilities for which fair values are measured as Level 3 instruments. These contingent consideration liabilities were recorded at fair value on the acquisition date and are remeasured quarterly based on the then assessed fair value and adjusted if necessary. The increases or decreases in the fair value of contingent consideration payable can result from changes in anticipated revenue levels and changes in assumed discount periods and rates. As the fair value measure is based on significant inputs that are not observable in the market, they are categorized as Level 3.

Revenue Recognition
Revenue Recognition—The Company derives its revenues primarily from subscription and transaction fees pertaining to services delivered over our exchanges or from our ASP platforms, fees for business process outsourcing services, and fees for software development projects including associated fees for consulting, implementation, training, and project management provided to customers with installed systems. Sales and value-added taxes are not included in revenues, but rather are recorded as a liability until the taxes assessed are remitted to the respective taxing authorities.
In accordance with Financial Accounting Standard Board (“FASB”) and SEC accounting guidance on revenue recognition, the Company considers revenue earned and realizable when: (a) persuasive evidence of the sales arrangement exists, provided that the arrangement fee is fixed or determinable, (b) delivery or performance has occurred, (c) customer acceptance has been received, if contractually required, and (d) collectability of the arrangement fee is probable. The Company uses signed contractual agreements as persuasive evidence of a sales arrangement. We apply the provisions of the relevant generally accepted accounting principles related to all transactions involving the license of software where the software deliverables are considered more than inconsequential to the other elements in the arrangement.
For contracts that contain multiple deliverables, we analyze the revenue arrangements in accordance with the relevant technical accounting guidance, which provides criteria governing how to determine whether goods or services that are delivered separately in a bundled sales arrangement should be considered as separate units of accounting for the purpose of revenue recognition. Generally these types of arrangements include deliverables pertaining to software licenses, system set-up, and professional services associated with product customization or modification. Delivery of the various contractual elements typically occurs over periods of less than eighteen months. These arrangements generally do not have refund provisions or have very limited refund terms.
Software development arrangements involving significant customization, modification or production are accounted for in accordance with the appropriate technical accounting guidance issued by FASB using the percentage-of-completion method. The Company recognizes revenue using periodic reported actual hours worked as a percentage of total expected hours required to complete the project arrangement and applies the percentage to the total arrangement fee.
Goodwill and Other Indefinite-Lived Intangible Assets
Goodwill and Other Indefinite-Lived Intangible Assets—Goodwill represents the cost in excess of the fair value of the net assets of acquired businesses. Indefinite-lived intangible assets represent the fair value of acquired contractual customer relationships for which future cash flows are expected to continue indefinitely. In accordance with the relevant FASB accounting guidance, goodwill and indefinite-lived intangible assets are not amortized but are tested for impairment at the reporting unit level on an annual basis or on an interim basis if an event occurs or circumstances change that would likely have reduced the fair value of a reporting unit below its carrying value. Potential impairment indicators include a significant change in the business climate, legal factors, operating performance indicators, competition, and the sale or disposition of a significant portion of the business. The impairment evaluation process involves an assessment of certain qualitative factors to determine whether the existence of events or circumstances would indicate that it is more likely than not that the fair value of any of our reporting units was less than its carrying amount. If after assessing the totality of events or circumstances, we were to determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then the Company would not perform the two-step quantitative impairment testing described further below.
The aforementioned two-step quantitative testing process involves comparing the reporting unit carrying values to their respective fair values; we determine fair value of our reporting units by applying the discounted cash flow method using the present value of future estimated net cash flows. If the fair value of a reporting unit exceeds its carrying value, then no further testing is required. However, if a reporting unit's fair value were to be less than its carrying value, we would then determine the amount of the impairment charge, if any, which would be the amount that the carrying value of the reporting unit's goodwill exceeded its implied value. Projections of cash flows are based on our views of growth rates, operating costs, anticipated future economic conditions and the appropriate discount rates relative to risk and estimates of residual values. We believe that our estimates are consistent with assumptions that marketplace participants would use in their estimates of fair value. The use of different estimates or assumptions for our projected discounted cash flows (e.g., growth rates, future economic conditions, discount rates and estimates of terminal values) when determining the fair value of our reporting units could result in different values and may result in a goodwill impairment charge. We perform our annual goodwill impairment evaluation and testing as of September 30th of each year. This evaluation is done during the fourth quarter each year. During the year ended December 31, 2012 we had no impairment of our reporting unit goodwill balances.
Finite-lived Intangible Assets
Finite-lived Intangible Assets—Purchased intangible assets represent the estimated acquisition date fair value of customer relationships, developed technology, trademarks and non-compete agreements obtained in connection with the businesses we acquire. We amortize these intangible assets on a straight-line basis over their estimated useful lives, as follows:

Category
 
Life (yrs)
Customer relationships
 
7-20
Developed technology
 
3–12
Trademarks
 
3–15
Non-compete agreements
 
5
Database
 
10
Foreign Currency Translation
Foreign Currency Translation—Historically the functional currency for the Company's foreign subsidiaries in India and Singapore had been the Indian rupee and Singapore dollar, respectively. As a result of the Company's rapid growth, the expansion of its intellectual property research and development activities in its Singapore subsidiary, and its product development activities and information technology enabled services for the insurance industry provided by its India subsidiary in support of Ebix's operating divisions across the world (both of which are transacted in U.S. dollars), management undertook a reconsideration of functional currency designations for these two foreign subsidiaries in India and Singapore, and concluded that effective July 1, 2012 the functional currency for these entities should be changed to the U.S. dollar. The Company believes that the acquisition of PlanetSoft along with other business acquisitions completed in 2012, combined with the cumulative effect of business acquisitions made over the last few years which in turn necessitated the rapid growth of the Company's operations in India and Singapore, were the primary economic facts and circumstances that justified the reconsideration and ultimate change in the functional currency.
The functional currency of the Company's other foreign subsidiaries is the local currency of the country in which the subsidiary operates. The assets and liabilities of these foreign subsidiaries are translated into U.S. dollars at the rates of exchange at the balance sheet dates. Income and expense accounts are translated at the average exchange rates in effect during the period. Gains and losses resulting from translation adjustments are included as a component of accumulated other comprehensive income in the accompanying consolidated balance sheets, and are included in the condensed consolidated statements of comprehensive income. Foreign exchange transaction gains and losses that are derived from transactions denominated in a currency other than the subsidiary's functional currency are included in the determination of net income.
Income Taxes
Income Taxes—Deferred income taxes are recorded to reflect the estimated future tax effects of differences between the financial statement and tax basis of assets, liabilities, operating losses, and tax credit carry forwards using the tax rates expected to be in effect when the temporary differences reverse. Valuation allowances, if any, are recorded to reduce deferred tax assets to the amount management considers more likely than not to be realized. Such valuation allowances are recorded for the portion of the deferred tax assets that are not expected to be realized based on the levels of historical taxable income and projections for future taxable income over the periods in which the temporary differences will be deductible.
The Company also applies FASB accounting guidance on accounting for uncertainty in income taxes positions. This guidance clarifies the accounting for uncertainty in income taxes by prescribing the minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. In this regard we recognize the tax benefit from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position.
Recent Relevant Accounting Pronouncements
Recent Relevant Accounting Pronouncements—The following is a brief discussion of recently released accounting pronouncements that are pertinent to the Company's business:

In July 2013, the FASB issued Accounting Standards Update No. 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists". This accounting standard states that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. This accounting standards update applies to all entities that have unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. The accounting standards update is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The amendments should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. The Company will adopt this new standard in 2014, and it may have an affect on how unrecognized tax benefits are accounted for and presented in the Company's balance sheet.
    
In July 2012, the FASB issued Accounting Standards Update No. 2012-02, "Testing Indefinite-Lived Intangible Assets for Impairment" (the revised standard). The revised standard is intended to reduce the cost and complexity of testing indefinite-lived intangible assets other than goodwill for impairment. It allows companies to perform a qualitative assessment to determine whether further impairment testing of indefinite-lived intangible assets is necessary, similar in approach to the goodwill impairment test. The revised standard is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. Early adoption is permitted. The Company will adopt this new standard in 2013 for use in its annual impairment evaluations of indefinite-lived intangible assets, which are performed as of September of each year.

v2.4.0.8
Description of Business and Summary of Significant Accounting Policies (Tables)
9 Months Ended
Sep. 30, 2013
Accounting Policies [Abstract]  
Schedule of Revenue by Product/Service Groups
Presented in the table below is the breakout of our revenue streams for each of those product/service groups for the three and nine months ended September 30, 2013 and 2012.

 
 
Three Months Ended
 
Nine Months Ended
 
 
September 30,
 
September 30,
(dollar amounts in thousands)
 
2013
 
2012
 
2013
 
2012
Exchanges
 
$
40,554

 
$
43,592

 
$
122,741

 
$
116,420

Broker Systems
 
4,390

 
4,537

 
13,878

 
13,713

Business Process Outsourcing (“BPO”)
 
3,604

 
4,252

 
11,781

 
11,713

Carrier Systems
 
1,745

 
1,423

 
5,463

 
3,501

Totals
 
$
50,293

 
$
53,804

 
$
153,863

 
$
145,347

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis
Additional information regarding the Company's assets and liabilities that are measured at fair value on a recurring basis is presented in the following table:

 
 
Fair Values at Reporting Date Using*
Descriptions
 
Balance, September 30, 2013
Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)
Significant Other Observable Inputs (Level 2)
Significant Unobservable Inputs (Level 3)
 
 
(In thousands)
Assets
 
 
 
 
 
Available-for-sale securities:
 
 
 
 
 
Commercial bank certificates of deposits
 
$
829