Reebok 2014 Annual Report Download - page 215

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adidas Group
/
2014 Annual Report
Consolidated Financial Statements
211
2014
/
04.8
/
Notes
/
Notes to the Consolidated Statement of Financial Position
Goodwill primarily relates to the Group’s acquisitions of the Reebok and TaylorMade businesses as well as
acquisitions of subsidiaries, primarily in the United States, Australia/New Zealand, the Netherlands, Denmark
and Italy.
Goodwill
(€ in millions) Dec. 31, 2014 Dec. 31, 2013
Goodwill, gross 1,588 1,533
Less: accumulated impairment losses (419) (329)
Goodwill, net 1,169 1,204
The majority of goodwill which primarily relates to the acquisition of the Reebok business in 2006 is denominated
in US dollars. A currency translation effect of positive € 73 million and negative € 25 million was recorded for the
years ending December 31, 2014 and 2013, respectively.
The Group determines whether goodwill impairment is necessary at least on an annual basis. This requires an
estimation of the value in use of the cash-generating units to which the goodwill is allocated. Estimating the value
in use requires the Group to make an estimate of the expected future cash flows from the cash-generating units
and also to choose a suitable discount rate in order to calculate the present value of those cash flows.
Goodwill impairment losses for 2014 amounted to € 78 million (2013: € 52 million). The goodwill impairment
amount related to 2014 comprises an impairment loss within the Retail segment of € 78 million (2013: € 29 million
Retail segment and € 23 million Wholesale segment).
Future changes in expected cash flows and discount rates may lead to impairments of the reported goodwill
in the future. For details see Attachment I to the consolidated financial statements
/
SEE STATEMENT OF MOVEMENTS
OF INTANGIBLE AND TANGIBLE ASSETS, P. 246.
The reconciliation of goodwill is as follows:
Reconciliation of goodwill, net
(€ in millions) Wholesale Retail Other
Businesses
Total
January 1, 2014 691 197 316 1,204
Currency translation differences 57 12 4 73
Impairment losses – (78) – (78)
Transfer to assets held for sale – – (30) (30)
December 31, 2014 748 131 290 1,169
At December 31, 2014, the carrying amount of acquired goodwill allocated to the cash-generating unit Rockport
was transferred to ‘Assets held for sale’ due to the concrete plans to sell the Rockport operating segment and is
impaired completely in connection with the fair value measurement of the disposal group
/
SEE NOTE 11.
13
Goodwill