Kodak 2014 Annual Report Download - page 64

Download and view the complete annual report

Please find page 64 of the 2014 Kodak annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 156

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156

NOTE 5: GOODWILL AND OTHER INTANGIBLE ASSETS
The following table presents the changes in the carrying value of goodwill by reportable segment:
Gross goodwill and accumulated impairment losses were $1.543 billion and $1.411 billion, respectively, as of December 31, 2012 and $1.544 billion and $1.488 billion,
respectively, as of August 31, 2013. As part of fresh start accounting, Kodak adjusted the carrying value of goodwill (see Note 25, “Fresh Start Accounting”).
Due to the sale of Kodak’s digital imaging patents during the first quarter of 2013, Kodak concluded that the carrying value of goodwill for its Intellectual Property and
Brand Licensing reporting unit exceeded the implied fair value of goodwill. The fair value of the Intellectual Property and Brand Licensing reporting unit was estimated
using an income approach in which the future cash flows, including a terminal value at the end of the projection period, were discounted to present value. Kodak
recorded a pre-tax impairment charge of $77 million that is included in Other operating expense (income), net in the Consolidated Statement of Operations.
As of October 1, 2014, the Graphics, Entertainment and Commercial Films Segment had three goodwill reporting units: Graphics, Entertainment Imaging and Commercial
Films and Intellectual Property and Brand Licensing. The Digital Printing and Enterprise Segment had four goodwill reporting units: Digital Printing, Packaging and
Functional Printing, Enterprise Services and Solutions, and Consumer Inkjet Systems. Goodwill recorded as part of fresh start accounting was allocated to the Graphics,
Packaging and Functional Printing, Intellectual Property and Brand Licensing and Consumer Inkjet Systems reporting units.
Based upon the results of Kodak’s October 1, 2014 annual impairment test, no impairment of goodwill was indicated.
As part of fresh start accounting, Kodak wrote-off existing intangibles and accumulated amortization and recorded an adjustment of $235 million to reflect the fair value of
intangibles. Refer to Note 25, “Fresh Start Accounting.” Due to the change in expected cash flows from the amounts estimated as part of fresh start accounting, Kodak
concluded the carrying value of the in-process research and development intangible asset exceeded its fair value based on its October 1, 2014 assessment. In the fourth quarter
of 2014, Kodak recorded a pre-tax impairment charge of $9 million that is included in Other operating expense (income), net in the Consolidated Statement of Operations.
Based upon the results of Kodak’s October 1, 2014 annual impairment test, no impairment of the Kodak trade name was indicated. In the fourth quarter of 2013, Kodak
concluded that the carrying value of the Kodak trade name, estimated as part of fresh start accounting, exceeded its fair value and Kodak recorded a pre-tax impairment
charge of $8 million that is included in Other operating expense (income), net in the Consolidated Statement of Operations.
(in millions)
Graphics,
Entertainment
and
Commercial
Films Segment
Digital Printing
and Enterprise
Segment
Consolidated
Total
Balance as of December 31, 2012 (Predecessor):
$
115
$
17
$
132
Impairment
(77
)
-
(77
)
Currency translation adjustments
1
-
1
Balance as of August 31, 2013 (Predecessor):
$
39
$
17
$
56
Impact of fresh start accounting
$
22
$
10
$
32
Balance as of December 31, 2013 (Successor):
$
61
$
27
$
88
Fresh start accounting adjustment
6
2
8
Balance as of December 31, 2014 (Successor):
$
67
$
29
$
96
61