Time Magazine 2010 Annual Report Download - page 84

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In 2010, the Company recorded noncash impairments of intangible assets of $9 million related to the
termination of a games licensing relationship at the Filmed Entertainment segment and $11 million related to
certain other intangibles at the Publishing segment. In 2009, the Company recorded a $52 million noncash
impairment of intangible assets at the Networks segment related to Turner’s interest in a general entertainment
network in India.
The impairments noted above did not result in non-compliance with respect to any debt covenants.
The following summary of changes in the Company’s goodwill related to continuing operations during the
years ended December 31, 2010 and 2009, by reportable segment, is as follows (millions):
December 31,
2008
Acquisitions,
Dispositions
and
Adjustments
Translation
Adjustments
December 31,
2009
Acquisitions,
Dispositions
and
Adjustments
Translation
Adjustments
December 31,
2010
Networks
Gross goodwill . . . . . . . . . . . . . . $ 34,305 $ 9 $ 5 $ 34,319 $ 192 $ (2) $ 34,509
Impairments . . . . . . . . . . . . . . . . (13,277) — — (13,277) — — (13,277)
Net goodwill . . . . . . . . . . . . . . . . 21,028 9 5 21,042 192 (2) 21,232
Filmed Entertainment
Gross goodwill . . . . . . . . . . . . . . 9,533 (19) 3 9,517 197 (5) 9,709
Impairments . . . . . . . . . . . . . . . . (4,091) — — (4,091) — — (4,091)
Net goodwill . . . . . . . . . . . . . . . . 5,442 (19) 3 5,426 197 (5) 5,618
Publishing
Gross goodwill . . . . . . . . . . . . . . 18,428 (8) 39 18,459 2 (29) 18,432
Impairments . . . . . . . . . . . . . . . . (15,288) — — (15,288) — — (15,288)
Net goodwill . . . . . . . . . . . . . . . . 3,140 (8) 39 3,171 2 (29) 3,144
Time Warner
Gross goodwill . . . . . . . . . . . . . . 62,266 (18) 47 62,295 391 (36) 62,650
Impairments . . . . . . . . . . . . . . . . (32,656) — — (32,656) — — (32,656)
Net goodwill . . . . . . . . . . . . . . . . $ 29,610 $ (18) $ 47 $ 29,639 $ 391 $ (36) $ 29,994
The Company’s intangible assets and related accumulated amortization consisted of the following (millions):
Gross
Accumulated
Amortization
(a)
Net Gross
Accumulated
Amortization
(a)
Net
December 31, 2010 December 31, 2009
Intangible assets subject to amortization:
Film Library . . . . . . . . . . . . . . . . . . . . . . . . $ 3,534 $ (2,036) $ 1,498 $ 3,635 $ (1,871) $ 1,764
Brands, tradenames and other
intangible assets . . . . . . . . . . . . . . . . . . . . . . 2,000 (1,006) 994 1,834 (922) 912
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,534 $ (3,042) $ 2,492 $ 5,469 $ (2,793) $ 2,676
Intangible assets not subject to amortization:
Brands, tradenames and other intangible
assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 8,084 $ (257) $ 7,827 $ 7,991 $ (257) $ 7,734
(a)
The Film Library is amortized using a film forecast methodology. Amortization of Brands, trademarks and other intangible assets subject to
amortization is provided generally on a straight-line basis over their respective useful lives. The weighted-average useful life for such
intangibles is 18 years. Each reporting period, the Company considers whether events or circumstances warrant revising the estimates of the
useful lives of its finite-lived intangible assets.
The Company recorded amortization expense of $264 million in 2010 compared to $280 million in 2009 and
$346 million in 2008. Based on the amount of intangible assets subject to amortization at December 31, 2010, the
72
TIME WARNER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)