GOODWILL AND OTHER PURCHASED INTANGIBLE ASSETS

Goodwill

As discussed in Note 2, Innovation Systems was established as a new, fourth business sector of the company. The Merger resulted in the recognition of $6.2 billion of goodwill, a majority of which was allocated to the Innovation Systems sector. A portion of this goodwill was allocated to the company’s other sectors based on expected revenue synergies generated by the integration of their products and technologies with those of Innovation Systems. The amount of goodwill recognized and allocated to the sectors is subject to change, pending the final determination of the fair value of assets acquired and liabilities assumed in connection with the Merger (see Note 2).

Changes in the carrying amounts of goodwill were as follows:



$ in millions	Aerospace Systems		Innovation Systems		Mission Systems			Technology Services			Total
Balance as of December 31, 2017	$	3,742	$	—	$	6,696		$	2,017		$	12,455
Acquisition of Orbital ATK	418		5,225		469			79			6,191
Other⁽¹⁾	—		—		(1		)	(3		)	(4		)
Balance as of September 30, 2018	$	4,160	$	5,225	$	7,164		$	2,093		$	18,642


⁽¹⁾	Other consists primarily of adjustments for foreign currency translation.

Accumulated goodwill impairment losses at September 30, 2018 and December 31, 2017, totaled $570 million at the Aerospace Systems segment.

Other Purchased Intangible Assets

Net customer-related and other intangible assets, including the fair value of purchased intangible assets acquired in the Merger, are as follows:



	September 30, 2018			December 31, 2017
$ in millions	September 30, 2018			December 31, 2017
Gross customer-related and other intangible assets	$	3,358		$	1,833
Less accumulated amortization	(1,898		)	(1,781		)
Net customer-related and other intangible assets	$	1,460		$	52

Amortization expense for the three and nine months ended September 30, 2018 was $89 million and $117 million, respectively, and was $3 million and $10 million for the three and nine months ended September 30, 2017, respectively. The company’s customer-related intangible assets are generally amortized over their respective useful lives based on the pattern in which the future economic benefits of the intangible assets are expected to be consumed. Other purchased intangible assets are generally amortized on a straight-line basis over their estimated useful lives. The company’s purchased intangible assets are being amortized over an aggregate weighted-average period of 12 years. As of September 30, 2018, the expected future amortization of purchased intangibles for each of the next five years is as follows:



$ in millions
2018 (remainder of year)	$	90
2019	331
2020	262
2021	204
2022	197