Avid 2008 Annual Report Download - page 75

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70
carrying value, indicating that a possible impairment loss had occurred. The current fair values of the identifiable
intangible assets were then determined using the income approach based on revised cash flows discounted to present
value. As a result, the Company determined that the trade name intangible asset was impaired and recorded an
impairment loss of $4.7 million to write this asset down to its current fair value.
In connection with the goodwill impairment loss recorded for the Consumer Video reporting unit in 2006, we also
reviewed the Consumer Video identifiable intangible assets for possible impairment. The result of this analysis was
that the undiscounted cash flows of the Consumer Video net asset groups exceeded the carrying value, indicating no
impairment loss had occurred.
Amortization expense related to all intangible assets in the aggregate was $20.4 million, $30.6 million and $35.6
million, respectively, for the years ended December 31, 2008, 2007 and 2006. The Company expects amortization of
these intangible assets to be approximately $11 million in 2009, $8 million in 2010, $7 million in 2011, $4 million in
2012, $2 million in 2013, and $6 million thereafter.
H. INCOME TAXES
Income (loss) before income taxes and the components of the income tax provision (benefit) consisted of the
following for the years ended December 31, 2008, 2007 and 2006 (in thousands):
2008 2007 2006
Income (loss) before income taxes:
United States $ (204,796) $ (23,324) $ (27,309)
Foreign 9,282 18,342 (265 )
Total income (loss) before income taxes $ (195,514) $ (4,982) $ (27,574)
Provision for (benefit from) income taxes:
Current tax expense (benefit):
Federal $ (404) $ (2,779) $ 2,290
State 250 250 669
Foreign benefit of net operating losses (1,777) (1,270) (364)
Other foreign 8,835 10,099 8,259
Total current tax expense 6,904 6,300 10,854
Deferred tax expense (benefit):
Federal (1,058) 318 7,926
State —
—
—
Foreign benefit of net operating losses —
—
—
Other foreign (3,183) (3,621) (3,427)
Total deferred tax expense (benefit) (4,241) (3,303) 4,499
Total provision for income taxes $ 2,663 $ 2,997 $ 15,353
Net cash payments for income taxes in 2008, 2007 and 2006 were approximately $5.5 million, $6.0 million, and $4.9
million, respectively.
The cumulative amount of undistributed earnings of foreign subsidiaries, which is intended to be permanently
reinvested and for which U.S. income taxes have not been provided, totaled approximately $143.9 million at
December 31, 2008. It is not practical to estimate the amount of additional taxes that might be payable upon
repatriation of foreign earnings.