Motorola 2005 Annual Report Download - page 127

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120
to determine the fair value of the reporting unit's goodwill. Fair value is determined with the help of independent
appraisal firms using a combination of present value techniques and quoted market prices of comparable businesses.
No impairment charges were required for the year ended December 31, 2005. For the year ended December 31,
2004, the Company determined that goodwill related to a sensor group, which was subsequently divested in 2005,
was impaired by a total of $125 million. For the year ended December 31, 2003 the Company determined that
goodwill at the infrastructure reporting unit of the Connected Home Solutions segment was impaired by
$73 million.
14. Valuation and Qualifying Accounts
The following table presents the valuation and qualifying account activity for the years ended December 31,
2005, 2004 and 2003:
Charged to
Balance at Net Balance at
January 1 Earnings Used Adjustments(1) December 31
2005
Reorganization of Businesses $ 130 $ 107 $ (106) $ (23) $ 108
Allowance for Doubtful Accounts 182 24 (16) (84) 106
Allowance for Losses on Finance Receivables 1,966 Ì (1,926) (28) 12
Inventory Reserves 548 606 (417) (188) 549
Warranty Reserves 500 848 (716) (131) 501
Customer Reserves 857 3,245 (2,619) (302) 1,181
2004
Reorganization of Businesses 259 59 (133) (55) 130
Allowance for Doubtful Accounts 224 47 (28) (61) 182
Allowance for Losses on Finance Receivables 2,095 2 (69) (62) 1,966
Inventory Reserves 592 418 (408) (54) 548
Warranty Reserves 359 648 (387) (120) 500
Customer Reserves 584 2,594 (2,036) (285) 857
2003
Reorganization of Businesses 545 174 (315) (145) 259
Allowance for Doubtful Accounts 234 51 (23) (38) 224
Allowance for Losses on Finance Receivables 2,251 33 (160) (29) 2,095
Inventory Reserves 826 498 (618) (114) 592
Warranty Reserves 309 319 (178) (91) 359
Customer Reserves 539 844 (731) (68) 584
(1) Includes translation adjustments.