Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2017

Goodwill And Intangible Assets Disclosure [Abstract]

9. Goodwill and Intangible Assets

GOODWILL	Total			Passive Safety Segment			Electronics Segment
Carrying amount at December 31, 2015	$	1,666.3		$	1,388.3		$	278.0
Acquisition		217.8			—			217.8
Translation differences		(13.4	)		(7.7	)		(5.7	)
Carrying amount at December 31, 2016	$	1,870.7		$	1,380.6		$	490.1
Acquisition		30.3			—			30.3
Goodwill impairment charge		(234.2	)		—			(234.2	)
Translation differences		22.0			16.5			5.5
Carrying amount at December 31, 2017	$	1,688.8		$	1,397.1		$	291.7

The goodwill recognized in 2016 of $217.8 million is related to the acquisition of Autoliv Nissin Brake Systems (ANBS). Of the $30.3 million of goodwill recognized in 2017, $13.4 million is related to the Fotonic acquisition in the fourth quarter of 2017 and $16.9 million is related to the finalization of the purchase price allocation for the ANBS acquisition in the first quarter of 2017 (see Note 2). In the fourth quarter of 2017, the Company recognized an impairment charge of the full goodwill amount of $234.2 million, after consideration of foreign exchange movements, related to ANBS within the Electronics segment (see table above). The Company estimated the fair value of ANBS using the discounted cash flow method, taking into account expected long-term operating cash-flow performance. The primary driver of the goodwill impairment was due to the lower expected long-term operating cash flow performance of the business unit as of the measurement date. For more information regarding the Company’s impairment testing, see section “Goodwill and Intangible Assets” in Note 1.

Approximately $1.2 billion of the Passive Safety goodwill is associated with the 1997 merger of Autoliv AB and the Automotive Safety Products Division of Morton International, Inc.

AMORTIZABLE INTANGIBLES	2017			2016
Gross carrying amount	$	628.7		$	618.2
Accumulated amortization		(463.9	)		(405.7	)
Carrying value	$	164.8		$	212.5

No significant impairments of intangible assets were recognized during 2016 and 2015.

At December 31, 2017, intangible assets subject to amortization mainly relate to acquired technology and contractual relationships. Of the carrying value of $164.8 million at December 31, 2017, $111 million was related to the technology asset category and $38 million was related to the contractual relationships asset category.

In the first quarter of 2017, the Company received information related to a contract with an OEM customer of M/A-COM products and as a result the Company recognized an impairment charge to amortization of intangibles in the Consolidated Statements of Net Income for a customer contract of $12 million. Of the carrying value of $212.5 million at December 31, 2016, $126 million was related to the technology asset category and $73 million was related to the contractual relationships asset category.

Amortization expense related to intangible assets was $47.0 million, $43.7 million and $19.6 million in 2017, 2016 and 2015, respectively. Estimated future amortization expense is (in millions): 2018: $31.3; 2019: $31.1; 2020: $30.1; 2021: $29.7 and 2022: $29.5.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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