XML 24 R17.htm IDEA: XBRL DOCUMENT  v2.3.0.11
Intangible Assets Including Goodwill
6 Months Ended
Jun. 30, 2011
Intangible Assets Including Goodwill  
Intangible Assets Including Goodwill

12. Intangible Assets Including Goodwill:  The following table details the company’s intangible asset balances by major asset class:

 

 

 

At June 30, 2011

 

(Dollars in millions)

 

Gross Carrying

 

Accumulated

 

Net Carrying

 

Intangible asset class

 

Amount

 

Amortization

 

Amount

 

Capitalized software

 

$

1,524

 

$

(706

)

$

818

 

Client-related

 

1,614

 

(650

)

963

 

Completed technology

 

2,122

 

(856

)

1,266

 

In-process R&D

 

22

 

(1

)

21

 

Patents/trademarks

 

216

 

(89

)

127

 

Other(a)

 

39

 

(29

)

9

 

Total

 

$

5,537

 

$

(2,332

)

$

3,205

 

 

 

 

At December 31, 2010

 

(Dollars in millions)

 

Gross Carrying

 

Accumulated

 

Net Carrying

 

Intangible asset class

 

Amount

 

Amortization

 

Amount

 

Capitalized software

 

$

1,558

 

$

(726

)

$

831

 

Client-related

 

1,709

 

(647

)

1,062

 

Completed technology

 

2,111

 

(688

)

1,422

 

In-process R&D

 

21

 

(0

)

21

 

Patents/trademarks

 

211

 

(71

)

140

 

Other(a)

 

39

 

(28

)

11

 

Total

 

$

5,649

 

$

(2,161

)

$

3,488

 

 

 

(a)   Other intangibles are primarily acquired proprietary and non-proprietary business processes, methodologies and systems.

 

The net carrying amount of intangible assets decreased $283 million during the first half of 2011, primarily due to amortization.  The aggregate intangible amortization expense was $309 million and $619 million for the second quarter and first six months of 2011 respectively, versus $284 million and $570 million for the second quarter and first six months ended June 30, 2010, respectively.  In addition, in the first half of 2011, the company retired $450 million of fully amortized intangible assets, impacting both the gross carrying amount and accumulated amortization by this amount.

 

The amortization expense for each of the five succeeding years relating to intangible assets currently recorded in the Consolidated Statement of Financial Position is estimated to be the following at June 30, 2011:

 

 

 

Capitalized

 

Acquired

 

 

 

(Dollars in millions)

 

Software

 

Intangibles

 

Total

 

2011 (for Q3 – Q4)

 

$

280

 

$

302

 

$

582

 

2012

 

370

 

556

 

926

 

2013

 

147

 

514

 

661

 

2014

 

21

 

372

 

393

 

2015

 

 

264

 

264

 

 

The changes in the goodwill balances by reportable segment, for the six months ended June 30, 2011 and for the year ended December 31, 2010 are as follows:

 

 

 

 

 

 

 

 

 

 

 

Foreign

 

 

 

 

 

 

 

 

 

 

 

 

 

Currency

 

 

 

 

 

 

 

 

 

Purchase

 

 

 

Translation

 

 

 

(Dollars in millions)

 

Balance

 

Goodwill

 

Price

 

 

 

And Other

 

Balance

 

Segment

 

01/01/11

 

Additions

 

Adjustments

 

Divestitures

 

Adjustments

 

6/30/11

 

Global Business Services

 

$

4,329

 

$

13

 

$

(0

)

$

(10

)

$

183

 

$

4,516

 

Global Technology Services

 

2,704

 

 

 

(2

)

23

 

2,725

 

Software

 

16,963

 

63

 

(8

)

 

211

 

17,230

 

Systems and Technology

 

1,139

 

 

(1

)

 

1

 

1,139

 

Total

 

$

25,136

 

$

76

 

$

(10

)

$

(11

)

$

418

 

$

25,609

 

 

 

 

 

 

 

 

 

 

 

 

Foreign

 

 

 

 

 

 

 

 

 

 

 

 

 

Currency

 

 

 

 

 

 

 

 

 

Purchase

 

 

 

Translation

 

 

 

(Dollars in millions)

 

Balance

 

Goodwill

 

Price

 

 

 

And Other

 

Balance

 

Segment

 

01/01/10

 

Additions

 

Adjustments

 

Divestitures

 

Adjustments

 

12/31/10

 

Global Business Services

 

$

4,042

 

$

252

 

$

0

 

$

 

$

35

 

$

4,329

 

Global Technology Services

 

2,777

 

32

 

(1

)

 

(104

)

2,704

 

Software

 

12,605

 

4,095

 

(52

)

 

315

 

16,963

 

Systems and Technology

 

766

 

375

 

(1

)

 

(1

)

1,139

 

Total

 

$

20,190

 

$

4,754

 

$

(54

)

$

 

$

245

 

$

25,136

 

 

Purchase price adjustments recorded in the first six months of 2011 and full year 2010 were related to acquisitions that were completed on or prior to December 31, 2010 or December 31, 2009, respectively, and were still subject to the measurement period that ends at the earlier of 12 months from the acquisition date or when information becomes available. There were no goodwill impairment losses recorded during the first six months of 2011 or the full year of 2010 and the company has no accumulated impairment losses.