Goodwill And Intangible Assets

12 Months Ended

Jul. 31, 2011

Goodwill And Intangible Assets

Goodwill And Intangible Assets

5.  Goodwill and Intangible Assets

The following table shows the changes in the carrying amount of goodwill by business segment:

	U.S.       Simple        Meals	U.S.     Beverages	Global Baking and   Snacking	International Simple Meals and Beverages	North      America   Foodservice	Total
Balance at August 2, 2009	$  322	$  112	$   700	$  621	$   146	$   1,901
Foreign currency translation adjustment	—	—	54	(36)	—	18
Balance at August 1, 2010	$  322	$  112	$   754	$  585	$   146	$   1,919
Foreign currency translation adjustment	—	—	160	54	—	214
Balance at July 31, 2011	$ 322	$ 112	$ 914	$ 639	$ 146	$   2,133

The following table sets forth balance sheet information for intangible assets, excluding goodwill, subject to amortization and intangible assets not subject to amortization:

	2011	2010
Intangible Assets:
Non-amortizable intangible assets	$  515	$  496
Amortizable intangible assets	21	21
	536	517
Accumulated amortization	(9)	(8)
Total net intangible assets	$  527	$  509

Non-amortizable intangible assets consist of trademarks, which mainly include Pace, Royco, Liebig, Blå Band and Touch of Taste. Amortizable intangible assets consist substantially of process technology and customer intangibles.

Amortization was less than $1 in 2011, 2010, and 2009. The estimated aggregated amortization expense for each of the five succeeding fiscal years is less than $1 per year. Asset useful lives range from ten to twenty years.

In 2011, as part of the company's annual review of intangible assets, an impairment charge of $3 was recognized related to the Heisse Tasse trademark used in the International Simple Meals and Beverages segment. The trademark was determined to be impaired as a result of a decrease in the fair value of the brand, resulting from reduced expectations for future sales and discounted cash flows. The impairment charge was recorded in Other expenses/(income) in the Consolidated Statements of Earnings. As of July 2011, certain European trademarks have a carrying value of approximately $100, which approximates fair value. Fair value is determined based on discounted cash flow analyses that include significant management assumptions such as revenue growth rates, weighted average cost of capital, and assumed royalty rates. Actual cash flows could differ from management's estimates due to changes in business performance, operating performance, and economic conditions. Holding all other assumptions constant, a 100-basis-point increase in the weighted average cost of capital would reduce fair value of all trademarks and result in impairment charges of approximately $21.

In 2009, as part of the company's annual review of intangible assets, an impairment charge of $67 was recognized related to certain European trademarks used in the International Simple Meals and Beverages segment, including Heisse Tasse, Blå Band and Royco. The trademarks were determined to be impaired as a result of a decrease in the fair value of the brands, resulting from reduced expectations for discounted cash flows. The reduction was due in part to a deterioration in market conditions and an increase in the weighted average cost of capital. The impairment charge was recorded in Other expenses/(income) in the Consolidated Statements of Earnings.

In May 2009, the company acquired Ecce Panis, Inc. Intangible assets from the acquisition totaled $16. See Note 8 for additional information.