Goodwill And Other Intangibles

12 Months Ended

Dec. 31, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER INTANGIBLES

GOODWILL

The following tables present changes in the goodwill balances as allocated to each business segment for the years ended December 31, 2012 and 2011:



In millions	Industrial Packaging			Printing Papers				Consumer Packaging				Distribution		Total
Balance as of January 1, 2012
Goodwill	$	1,157		$	2,439			$	1,779			$	400	$	5,775
Accumulated impairment losses (a)	—			(1,765		)		(1,664		)		—		(3,429		)
	1,157			674				115				400		2,346
Reclassifications and other (b)	1			(40		)		1				—		(38		)
Additions/reductions	2,007		(c)	(3		)	(d)	3			(e)	—		2,007
Balance as of December 31, 2012
Goodwill	3,165			2,396				1,783				400		7,744
Accumulated impairment losses (a)	—			(1,765		)		(1,664		)		—		(3,429		)
Total	$	3,165		$	631			$	119			$	400	$	4,315


(a)	Represents accumulated goodwill impairment charges since the adoption of ASC 350, “Intangibles – Goodwill and Other” in 2002.


(b)	Represents the effects of foreign currency translations and reclassifications.


(c)	Reflects the acquisition of Temple-Inland, net of amounts written off related to the divestiture of two Temple-Inland mills (Ontario, California and New Johnsonville, Tennessee) and one International Paper mill (Oxnard (Hueneme), California). Also excludes the goodwill for Building Products which was reclassified to Businesses Held for Sale.


(d)	Reflects an increase related to a purchase price adjustment for Andhra Pradesh Paper Mills in India partially offset by a reduction from tax benefits generated by the deduction of goodwill amortization for tax purposes in Brazil.


(e)	Represents the impact of the change in estimate of the contributed land in the Shandong IP & Sun Food Packaging Co., Ltd. joint venture in China entered into in 2011.



In millions	Industrial Packaging				Printing Papers				Consumer Packaging				Distribution		Total
Balance as of January 1, 2011
Goodwill	$	1,151			$	2,418			$	1,768			$	400	$	5,737
Accumulated impairment losses (a)	—				(1,765		)		(1,664		)		—		(3,429		)
	1,151				653				104				400		2,308
Reclassifications and other (b)	(1		)		(67		)		5				—		(63		)
Additions/reductions	7			(c)	88			(d)	6			(e)	—		101
Balance as of December 31, 2011
Goodwill	1,157				2,439				1,779				400		5,775
Accumulated impairment losses (a)	—				(1,765		)		(1,664		)		—		(3,429		)
Total	$	1,157			$	674			$	115			$	400	$	2,346


(a)	Represents accumulated goodwill impairment charges since the adoption of ASC 350, “Intangibles – Goodwill and Other” in 2002.


(b)	Represents the effects of foreign currency translations and reclassifications.


(c)	Represents purchase price adjustments related to the finalization of the SCA Packaging Asia acquisition.


(d)	Reflects an increase related to the acquisition of Andhra Pradesh Paper Mills in India partially offset by a reduction from tax benefits generated by the deduction of goodwill amortization for tax purposes in Brazil.


(e)	Represents the joint venture between IP Asia and Sun Paper Industry Co, Ltd.

No goodwill impairment charges were recorded in 2012, 2011 or 2010.

OTHER INTANGIBLES

Identifiable intangible assets comprised the following:



	2012				2011
In millions at December 31	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Customer relationships and lists	$	644	$	112	$	227	$	82
Non-compete agreements	83		30		72		19
Tradenames, patents and trademarks	144		16		51		21
Land and water rights	87		6		60		3
Fuel and power agreements	17		12		30		16
Software	22		19		37		29
Other	83		19		27		13
Total (a)	$	1,080	$	214	$	504	$	183


(a)	The increase in 2012 is primarily due to the acquisition of Temple-Inland.

The Company recognized the following amounts as amortization expense related to intangible assets:



In millions	2012		2011		2010
Amortization expense related to intangible assets	$	58	$	32	$	31

Based on current intangibles subject to amortization, estimated amortization expense for each of the succeeding years is as follows: 2013 – $37 million, 2014 – $36 million, 2015 – $29 million, 2016 – $29 million, 2017 – $28 million, and cumulatively thereafter – $706 million.

- 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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