Goodwill and intangible assets

12 Months Ended

Mar. 31, 2013

9.	*Goodwill and intangible assets*

Intangible assets acquired during the fiscal year ended March 31, 2013 totaled 66,483 million yen, of which 65,710 million yen is subject to amortization and are comprised of the following:


	Intangible assets acquired during the year		Weighted-average amortization period
	Yen in millions		Years
Patent rights, know-how and license agreements		38,231		7
Trademarks		537		10
Software to be sold, leased or otherwise marketed		19,444		4
Other		7,498		4

Intangible assets subject to amortization are comprised of the following:


	Yen in millions
	March 31, 2012					March 31, 2013
	Gross carrying amount		Accumulated amortization			Gross carrying amount		Accumulated amortization
Patent rights, know-how and license agreements		226,142		(80,334	)		280,715		(118,363	)
Customer relationships		23,758		(1,409	)		26,485		(3,658	)
Trademarks		20,214		(2,154	)		21,896		(5,894	)
Software to be sold, leased or otherwise marketed		98,852		(58,865	)		115,341		(73,314	)
Music catalogs		157,699		(45,570	)		183,398		(62,255	)
Artist contracts		27,401		(19,419	)		26,702		(18,939	)
Television carriage agreements (broadcasting agreements)		36,216		(2,370	)		41,264		(4,759	)
Other		87,843		(54,338	)		95,501		(67,026	)

Total		678,125		(264,459	)		791,302		(354,208	)

The aggregate amortization expense for intangible assets for the fiscal years ended March 31, 2011, 2012 and 2013 was 52,763 million yen, 57,023 million yen and 75,890 million yen, respectively. The estimated aggregate amortization expense for intangible assets for the next five years is as follows:


Fiscal year ending March 31	Yen in millions
2014		75,357
2015		61,439
2016		48,693
2017		38,435
2018		31,411

Total carrying amount of intangible assets having an indefinite life are comprised of the following:


	Yen in millions
	March 31
	2012		2013
Trademarks		66,729		68,099
Distribution agreements		18,807		19,116
Other		4,497		3,198

Total		90,033		90,413

The changes in the carrying amount of goodwill by segment for the fiscal years ended March 31, 2012 and 2013 are as follows:


	Yen in millions
	Imaging Products & Solutions			Game			Mobile Products & Communications*¹		Home Entertainment & Sound			Devices			Pictures			Music			Financial Services			All Other			Total
Balance, March 31, 2011:
Goodwill — gross		6,044			123,285			—		5,320			62,628			140,584			102,994			3,020			39,417			483,292
Accumulated impairments		(300	)		—			—		(5,320	)		—			—			(306	)		(706	)		(7,655	)		(14,287	)

Goodwill		5,744			123,285			—		0			62,628			140,584			102,688			2,314			31,762			469,005

Increase (decrease) due to:
Acquisitions		—			166			128,522		—			—			1,330			—			—			4,358			134,376
Sales and dispositions		—			—			—		—			(589	)		—			—			—			—			(589	)
Impairments*²		—			—			—		—			—			—			—			—			(932	)		(932	)
Translation adjustments		124			(240	)		9,733		—			(107	)		(3,073	)		(1,891	)		—			(585	)		3,961
Other³⁴		(201	)		—			—		—			(28,773	)		(521	)		(147	)		—			579			(29,063	)

Balance, March 31, 2012:
Goodwill — gross		5,967			123,211			138,255		5,320			33,159			138,320			100,956			3,020			43,769			591,977
Accumulated impairments		(300	)		—			—		(5,320	)		—			—			(306	)		(706	)		(8,587	)		(15,219	)

Goodwill		5,667			123,211			138,255		0			33,159			138,320			100,650			2,314			35,182			576,758

Increase (decrease) due to:
Acquisitions*⁵		—			19,793			—		—			2,044			3,174			2,626			—			1,022			28,659
Sales and dispositions*⁶		—			—			—		—			—			—			—			—			(15,040	)		(15,040	)
Impairments*²		—			—			—		—			—			—			—			—			(1,445	)		(1,445	)
Translation adjustments		108			4,527			15,314		—			316			19,338			10,402			—			2,368			52,373
Other*³		—			—			—		—			1,750			25			(28	)		—			191			1,938

Balance, March 31, 2013:
Goodwill — gross		6,075			147,531			153,569		5,320			37,269			160,857			113,956			3,020			32,310			659,907
Accumulated impairments		(300	)		—			—		(5,320	)		—			—			(306	)		(706	)		(10,032	)		(16,664	)

Goodwill		5,775			147,531			153,569		0			37,269			160,857			113,650			2,314			22,278			643,243

*1	The 128,522 million yen in the fiscal year ended March 31, 2012 relates to the Sony Ericsson acquisition. Refer to Note 24.

During the fiscal years ended March 31, 2012 and 2013, Sony recorded impairment losses of 932 million yen and 1,445 million yen, respectively, in reporting units included in All Other. The impairment charges reflected the overall decline in the fair values of the reporting units. The fair values of the reporting units were estimated using the expected present value of future cash flows.

*3	Other primarily consists of purchase price adjustments for prior years and amounts reclassified as held for sale.

The chemical products business, which is included in the Devices segment was classified as held for sale as of March 31, 2012. No impairment loss was recognized as a result of the held for sale classification. The assets held for sale included 29,182 million yen of goodwill which was reclassified to other assets in the consolidated balance sheets prior to completing the divestiture in the fiscal year ended March 31, 2013. Refer to Note 25.

*5	Substantially all of the acquisition amounts in the Game segment relate to the Gaikai Inc. (“Gaikai”) acquisition. Refer to Note 24.

*6	Sales and dispositions amounts in All Other substantially all relate to the sale of certain M3 shares. Refer to Note 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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