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2015 Annual Report | 43
In prior years, the Company had faced persistent challenges in the Artesyn business due to protracted weak
demand, structural industry developments and increased competition. These challenges, including weakness
in telecommunication and mobile device markets, continued into 2013 and sales and earnings were below
expectations. In the third quarter of 2013, the Company recorded a noncash goodwill impairment charge of $503
($475 after-tax, $0.65 per share). Income tax charges of $70 ($0.10 per share) for the anticipated repatriation of
non-U.S. earnings from this business were also recorded in 2013. Additionally, in the fourth quarter the Company’s
goodwill impairment testing indicated that the carrying value of the connectivity solutions business in Network
Power exceeded its fair value due to operating results not meeting forecasted expectations, resulting in a noncash
charge to earnings of $25 ($21 after-tax, $0.03 per share). The Company divested both of these businesses in 2014.
See Note 3.
The change in the carrying value of goodwill by business segment follows:
COMMERCIAL &
PROCESS INDUSTRIAL NETWORK CLIMATE RESIDENTIAL
MANAGEMENT AUTOMATION POWER TECHNOLOGIES SOLUTIONS TOTAL
Gross goodwill $2,383 1,352 2,995 503 439 7,672
Accumulated impairment (163) (163)
Balance, September 30, 2013 2,383 1,352 2,832 503 439 7,509
Acquisitions 356 22 378
Divestitures (70) (70)
Impairment (508) (508)
Foreign currency translation and other (38) (23) (58) (3) (5) (127)
Gross goodwill 2,701 1,329 2,864 500 434 7,828
Accumulated impairment (646) (646)
Balance, September 30, 2014 2,701 1,329 2,218 500 434 7,182
Acquisitions 176 2 178
Divestitures (213) (228) (441)
Foreign currency translation and other (87) (85) (74) (8) (12) (266)
Gross goodwill 2,790 1,031 2,790 492 196 7,299
Accumulated impairment (646) (646)
Balance, September 30, 2015 $2,790 1,031 2,144 492 196 6,653
The gross carrying amount and accumulated amortization of identifiable intangible assets by major class follow:
CUSTOMER INTELLECTUAL CAPITALIZED
RELATIONSHIPS PROPERTY SOFTWARE TOTAL
2014 2015 2014 2015 2014 2015 2014 2015
Gross carrying amount $1,594 1,508 1,052 1,051 1,190 1,178 3,836 3,737
Less: Accumulated amortization 643 693 613 649 891 869 2,147 2,211
Net carrying amount $ 951 815 439 402 299 309 1,689 1,526
Total intangible asset amortization expense for 2015, 2014 and 2013 was $308, $313 and $298, respectively. Based
on intangible asset balances as of September 30, 2015, amortization expense is expected to approximate $286 in
2016, $267 in 2017, $236 in 2018, $194 in 2019 and $161 in 2020.