GE 2007 Annual Report Download - page 91

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ge 2007 annual report 89
Goodwill balances increased $9,028 million in 2007 as a result of
new acquisitions. The largest goodwill balance increases arose
from acquisitions of Smiths Aerospace Group Ltd. ($3,877 million)
and Vetco Gray ($1,379 million) by Infrastructure; Diskont und
Kredit AG and Disko Leasing GmbH (DISKO) and ASL Auto Service-
Leasing GmbH (ASL), the leasing businesses of KG Allgemeine
Leasing GmbH & Co. ($694 million) by Commercial Finance; Oxygen
Media ($604 million) by NBC Universal; and Sanyo Electric Credit Co.,
Ltd. ($548 million) by Commercial Finance. The goodwill balance
declined by $269 million related to purchase accounting adjust-
ments to prior-year acquisitions during 2007.
Goodwill balances increased $4,430 million in 2006 as a result
of new acquisitions. The largest goodwill balance increases arose
from acquisitions of IDX Systems Corporation ($1,133 million)
and Biacore International AB ($308 million) by Healthcare; iVillage
Inc. ($521 million) by NBC Universal; ZENON Environmental Inc.
($506 million) by Infrastructure; and Banque Artesia Nederland N.V.,
a subsidiary of Dexia Group ($340 million) and the custom fl eet
business of National Australia Bank Ltd. ($306 million) by Commercial
Finance. Goodwill declined in 2006 as a result of the sale of
television stations ($304 million) by NBC Universal. The goodwill
balance also declined by $194 million related to purchase account-
ing adjustments to prior-year acquisitions during 2006.
Upon closing an acquisition, we estimate the fair values of
assets and liabilities acquired and consolidate the acquisition as
quickly as possible. Given the time it takes to obtain pertinent
information to fi nalize the acquired company’s balance sheet, then
to adjust the acquired company’s accounting policies, procedures,
books and records to our standards, it is often several quarters
before we are able to fi nalize those initial fair value estimates.
Accordingly, it is not uncommon for our initial estimates to be
subsequently revised.
INTANGIBLE ASSETS SUBJECT TO AMORTIZATION
Gross
carrying Accumulated
December 31 (In millions) amount amortization Net
GE
2007
Customer-related $ 4,526 $ (698) $3,828
Patents, licenses and trademarks 4,561 (1,369) 3,192
Capitalized software 4,573 (2,589) 1,984
All other 436 (162) 274
Total $14,096 $(4,818) $9,278
2006
Customer-related $ 2,853 $ (484) $2,369
Patents, licenses and trademarks 4,242 (1,071) 3,171
Capitalized software 4,184 (2,467) 1,717
All other 313 (109) 204
Total $11,592 $(4,131) $7,461
GECS
2007
Customer-related $ 2,185 $ (867) $1,318
Patents, licenses and trademarks 602 (315) 287
Capitalized software 1,857 (1,105) 752
Lease valuations 1,909 (376) 1,533
Present value of future profi ts 818 (364) 454
All other 350 (149) 201
Total $ 7,721 $(3,176) $4,545
2006
Customer-related $ 1,410 $ (654) $ 756
Patents, licenses and trademarks 413 (265) 148
Capitalized software 1,645 (965) 680
Lease valuations 851 (132) 719
Present value of future profi ts 829 (297) 532
All other 500 (159) 341
Total $ 5,648 $(2,472) $3,176
Changes in goodwill balances follow.
2007 2006
Acquisitions/ Dispositions, Acquisitions/ Dispositions,
purchase currency purchase currency
Balance accounting exchange Balance Balance accounting exchange Balance
(In millions) January 1 (a) adjustments and other December 31 January 1 adjustments and other December 31
Infrastructure $10,931 $6,069 $ 117 $17,117 $10,166 $ 590 $ 175 $10,931
Commercial Finance 12,745 1,568 308 14,621 12,027 566 152 12,745
GE Money 9,845 2 426 10,273 9,184 309 352 9,845
Healthcare 14,759 26 42 14,827 13,404 1,396 48 14,848
NBC Universal 18,000 733 — 18,733 17,534 838 (372) 18,000
Industrial 5,030 361 154 5,545 4,505 537 (12) 5,030
Total
$71,310 $8,759 $1,047 $81,116 $66,820 $4,236 $ 343 $71,399
(a) January 1, 2007, balance decreased by $89 million related to new accounting standards. See note 1.