XML 29 R19.htm IDEA: XBRL DOCUMENT v3.22.2.2
Intangible Assets Including Goodwill
9 Months Ended
Sep. 30, 2022
Intangible Assets Including Goodwill  
Intangible Assets Including Goodwill

11. Intangible Assets Including Goodwill: 

Intangible Assets

The following tables present the company's intangible asset balances by major asset class.

At September 30, 2022

    

Gross Carrying

    

Accumulated

    

Net Carrying

(Dollars in millions)

Amount

Amortization

Amount*

Intangible asset class:

Capitalized software

$

1,697

$

(720)

$

977

Client relationships

 

8,051

 

(2,763)

 

5,288

Completed technology

 

5,490

 

(2,242)

 

3,248

Patents/trademarks

 

2,093

 

(645)

 

1,448

Other**

 

32

 

(27)

 

5

Total

$

17,364

$

(6,397)

$

10,967

At December 31, 2021

    

Gross Carrying

    

Accumulated

    

Net Carrying

(Dollars in millions)

Amount

Amortization

Amount*

Intangible asset class:

Capitalized software

$

1,696

$

(751)

$

945

Client relationships

 

9,021

 

(2,889)

 

6,132

Completed technology

 

6,074

 

(2,259)

 

3,815

Patents/trademarks

 

2,196

 

(586)

 

1,610

Other**

 

44

 

(35)

 

9

Total

$

19,031

$

(6,520)

$

12,511

*  Amounts as of September 30, 2022 and December 31, 2021 included a decrease in net intangible asset balances of $389 million and $221 million, respectively, due to foreign currency translation.

**

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

The net carrying amount of intangible assets decreased $1,544 million during the first nine months of 2022, primarily due to intangible asset amortization and the impacts of currency, partially offset by additions of acquired intangibles and capitalized software. The aggregate intangible asset amortization expense was $577 million and $1,828 million for the third quarter and first nine months of 2022, respectively, compared to $640 million and $1,880 million for the third quarter and first nine months of 2021, respectively. In the first nine months of 2022, the company retired $647 million of fully amortized intangible assets, impacting both the gross carrying amount and accumulated amortization by this amount. The company also derecognized intangible assets with a gross carrying amount of $1,313 million and $1,149 million of accumulated amortization as part of the divestiture of its healthcare software assets on June 30, 2022.

The future amortization expense relating to intangible assets currently recorded in the Consolidated Balance Sheet was estimated to be the following at September 30, 2022:

    

Capitalized

    

Acquired

    

    

(Dollars in millions)

Software

Intangibles

Total

Remainder of 2022

$

157

$

405

$

562

2023

 

472

 

1,469

 

1,941

2024

 

286

 

1,452

 

1,737

2025

 

63

 

1,434

 

1,497

2026

 

 

1,417

 

1,417

Thereafter

3,813

 

3,813

Goodwill

The changes in the goodwill balances by segment for the nine months ended September 30, 2022 and for the year ended December 31, 2021 were as follows:

    

    

    

    

    

    

Foreign

    

    

Currency

Purchase

Translation

(Dollars in millions)

Balance

Goodwill

Price

and Other

Balance

Segment

1/1/2022

Additions

Adjustments

Divestitures

Adjustments*

9/30/2022

Software

$

43,966

$

442

$

(118)

$

$

(1,290)

$

43,001

Consulting

 

6,797

 

461

 

(42)

 

 

(343)

 

6,872

Infrastructure

4,396

(1)

(50)

4,345

Other**

 

484

 

 

 

(484)

 

 

Total

$

55,643

$

903

$

(160)

$

(485)

$

(1,683)

$

54,218

*

Primarily driven by foreign currency translation.

**

The company derecognized $484 million of goodwill related to the divestiture of its healthcare software assets. Refer to note 6, “Acquisitions & Divestitures,” for additional information.

    

    

    

    

    

    

Foreign

    

    

Currency

Purchase

Translation

(Dollars in millions)

Balance

Goodwill

Price

and Other

Balance

Segment

1/1/2021

Additions

Adjustments

Divestitures

Adjustments*

12/31/2021

Software**

$

42,665

$

1,836

$

23

$

(13)

$

(545)

$

43,966

Consulting

 

6,145

 

713

 

(21)

 

 

(40)

 

6,797

Infrastructure

 

4,436

 

 

0

 

 

(39)

 

4,396

Other**

 

520

 

 

 

(37)

 

1

 

484

Total

$

53,765

$

2,549

$

2

$

(50)

$

(623)

$

55,643

*

Primarily driven by foreign currency translation.

**

Recast to conform to current year presentation.

There were no goodwill impairment losses recorded during the first nine months of 2022 or full-year 2021 and the company has no accumulated impairment losses. Purchase price adjustments recorded in the first nine months of 2022 and full-year 2021 were related to acquisitions that were still subject to the measurement period that ends at the earlier of 12 months from the acquisition date or when information becomes available. Net purchase price adjustments recorded in the first nine months of 2022 primarily relate to deferred tax assets and liabilities associated with the Turbonomic acquisition.