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70 PepsiCo, Inc. 2009 Annual Report
Notes to Consolidated Financial Statements
Depreciable and amortizable assets are only evaluated for
impairment upon a significant change in the operating or
macroeconomic environment. In these circumstances, if an
evaluation of the undiscounted cash flows indicates impairment,
the asset is written down to its estimated fair value, which
is based on discounted future cash flows. Useful lives are
periodically evaluated to determine whether events or
circumstances have occurred which indicate the need for
revision. For additional unaudited information on our
amortizable brand policies, see “Our Critical Accounting Policies”
in Management’s Discussion and Analysis of Financial Condition
and Results of Operations.
NONAMORTIZABLE INTANGIBLE ASSETS
Perpetual brands and goodwill are assessed for impairment at least annually. If the carrying amount of a perpetual brand exceeds its fair
value, as determined by its discounted cash flows, an impairment loss is recognized in an amount equal to that excess. No impairment
charges resulted from these impairment evaluations. The change in the book value of nonamortizable intangible assets is as follows:
Balance,
Beginning 2008Acquisitions Translation
and Other Balance,
End of 2008 Acquisitions Translation
and Other Balance,
End of 2009
FLNA
Goodwill $÷«311 $÷÷– $÷(34) $÷«277 $÷÷÷«6 $÷«23 $÷«306
Brands – – – – 26 4 30
311 – (34) 277 32 27 336
QFNA
Goodwill 175 – – 175 – – 175
LAF
Goodwill 147 338 (61) 424 17 38 479
Brands 22 118 (13) 127 1 8 136
169 456 (74) 551 18 46 615
PAB
Goodwill 2,369 – (14) 2,355 62 14 2,431
Brands 59 – – 59 48 5 112
2,428 – (14) 2,414 110 19 2,543
Europe
Goodwill 1,642 45 (218) 1,469 1,291 (136) 2,624
Brands 1,041 14 (211) 844 572 (38) 1,378
2,683 59 (429) 2,313 1,863 (174) 4,002
AMEA
Goodwill 525 1 (102) 424 4 91 519
Brands 126 – (28) 98 – 28 126
651 1 (130) 522 4 119 645
Total goodwill 5,169 384 (429) 5,124 1,380 30 6,534
Total brands 1,248 132 (252) 1,128 647 7 1,782
$6,417 $516 $(681) $6,252 $2,027 $÷«37 $8,316
88045_pepsico-09ar_64-86_R1.indd 70 2/24/10 5:04 PM