XML 23 R12.htm IDEA: XBRL DOCUMENT v3.19.1
Goodwill and Other Intangible Assets
6 Months Ended
Mar. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangible Assets
5. Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill are as follows:

(in millions)
 
Americas
 
EMEA
 
Asia
 
Total
Balance at September 30, 2018
 
$
642

 
$
469

 
$
1,071

 
$
2,182

Currency translation and other
 

 
(29
)
 
12

 
(17
)
Balance at March 31, 2019
 
$
642

 
$
440

 
$
1,083

 
$
2,165



During the second quarter of fiscal 2019, Adient began reporting three new segments: 1) Americas, which is inclusive of North America and South America; 2) Europe, Middle East, and Africa ("EMEA") and 3) Asia Pacific/China ("Asia"). Accordingly, goodwill previously reported in the former Seating segment has been reallocated to the three new segments on a relative fair value basis. Refer to Note 14, "Segment Information" for more information on Adient's reportable segments.

Adient evaluates its goodwill for impairment on an annual basis, or as facts and circumstances warrant. As a result of the change in reportable segments during the second quarter of fiscal 2019, Adient conducted goodwill impairment analyses of the newly allocated goodwill balances under the new reportable segment structure. Adient performs impairment reviews for its reporting units, which have been determined to be Adient's reportable segments, using a fair value method based on management's judgments and assumptions or third party valuations. The fair value of a reporting unit refers to the price that would be received to sell the unit as a whole in an orderly transaction between market participants at the measurement date. Adient estimated the fair value of each of its reporting units using a discounted cash flow analysis approach, which utilized Level 3 unobservable inputs. These calculations contain uncertainties as they require management to make assumptions about market comparables, future cash flows, the appropriate discount rates (based on weighted average cost of capital ranging from 14.5%-17.5%) and growth rates to reflect the risk inherent in the future cash flows. The estimated future cash flows reflect management's latest assumptions of the financial projections based on current and anticipated competitive landscape and product profitability based on historical trends. A change in any of these estimates and assumptions could produce a different fair value, which could have a material impact on Adient's results of operations. As a result of the analyses, Adient determined that no goodwill was impaired.

Adient's other intangible assets, primarily from business acquisitions valued based on independent appraisals, consisted of:
 
 
March 31, 2019
 
September 30, 2018
(in millions)
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Patented technology
 
$
20

 
$
(14
)
 
$
6

 
$
21

 
$
(14
)
 
$
7

Customer relationships
 
514

 
(117
)
 
397

 
509

 
(101
)
 
408

Trademarks
 
53

 
(31
)
 
22

 
58

 
(30
)
 
28

Miscellaneous
 
28

 
(12
)
 
16

 
29

 
(12
)
 
17

Total intangible assets
 
$
615

 
$
(174
)
 
$
441

 
$
617

 
$
(157
)
 
$
460



Amortization of other intangible assets for the six months ended March 31, 2019 and 2018 was $20 million and $24 million, respectively.