GOODWILL AND OTHER INTANGIBLE ASSETS, NET

12 Months Ended

Mar. 31, 2011

GOODWILL AND OTHER INTANGIBLE ASSETS, NET

8. GOODWILL AND OTHER INTANGIBLE ASSETS, NET

Intangible assets developed or acquired during the year ended March 31, 2011 totaled ¥ 660 million ($ 7,952 thousand), which are subject to amortization and primarily consist of Software. The weighted average amortization period for Intellectual property rights, Software, Other, and Total is approximately 8 years, 8 years 19 years, and 11 years, respectively.

The components of intangible assets subject to amortization at March 31, 2010 and 2011 were as follows:


	Yen in millions								U.S. Dollars in thousands
	2010				2011				2011
	Gross carrying amount		Accumulated amortization		Gross carrying amount		Accumulated amortization		Gross carrying amount		Accumulated amortization
Intellectual property right	¥	2,866	¥	157	¥	2,879	¥	368	$	34,687	$	4,434
Software		2,841		1,826		3,040		2,044		36,626		24,627
Other		1,224		383		1,403		412		16,904		4,963

Total	¥	6,931	¥	2,366	¥	7,322	¥	2,824	$	88,217	$	34,024

Aggregate amortization expense for the years ended March 31, 2009, 2010 and 2011 was ¥ 443 million, ¥ 552 million and ¥ 647 million ($ 7,795 thousand), respectively. Estimated amortization expense for intangible assets currently held for the next five years ending March 31 is ¥ 629 million in 2012, ¥ 585 million in 2013, ¥ 514 million in 2014, ¥ 326 million in 2015, and ¥ 306 million in 2016.

Intangible assets not subject to amortization at March 31, 2010 and 2011 were as follows:


	Yen in millions				U.S. Dollars in thousands
	2010		2011		2011
Gross carrying amount	¥	99	¥	97	$	1,168

The changes in the carrying amount of goodwill at March 31, 2010 and 2011 were as follows:


	Yen in millions				U.S. Dollars in thousands
	2010		2011		2011
Beginning balance	¥	1,987	¥	721	$	8,687
Impairment		(1,251)		-		-
Other		(15)		-		-

Ending balance	¥	721	¥	721	$	8,687

Makita recognized a goodwill impairment loss for the year ended March 31, 2010 of ¥ 1,251 million, which was included in the results of the Japan operating segment. Management determined that no impairment of goodwill occurred at the Makita’s Japan operating segment as a result of the March 11, 2011 earthquake and resulting tsunami in Japan.

This impairment loss was included in selling, general, administrative and others, net in the consolidated statements of income. The management estimated the fair value of the reporting unit based on weighted average value estimated by the income approach method and by the market approach method.

- 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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