Goodwill and Intangible Assets

12 Months Ended

Jun. 30, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets [Text Block]

GOODWILL AND INTANGIBLE ASSETS

Goodwill

The Company monitors the recoverability of goodwill recorded in connection with acquisitions, by reporting unit, annually, or more often if events or changes in circumstances indicate that the carrying amount may not be recoverable.

Fiscal Year 2018

In fiscal year 2018, the Company elected to perform a qualitative analysis to assess impairment of goodwill rather than to perform the quantitative goodwill impairment test. The key qualitative factors considered in the assessment included the change in the industry and competitive environment, market capitalization, and overall financial performance. Based on the results of this qualitative analysis, the Company determined that it was more likely than not that the fair value of each reporting unit exceeded its carrying value, and therefore, the Company concluded that goodwill was not impaired in fiscal year 2018.

Fiscal Year 2017

In fiscal year 2017, the Company performed a qualitative analysis to assess impairment of goodwill during the fourth quarter and concluded that goodwill was not impaired, as the fair value of each reporting unit exceeded its carrying value. No indicators or instances of impairment were identified during fiscal year 2017.

Activity and goodwill balances for the fiscal years ended June 30, 2018 and June 24, 2017 were as follows:



	Goodwill
	(in thousands)
Balance at June 25, 2016	$	490,648
Adjustments	367
Balance at June 24, 2017	491,015
Acquisitions	41,889
Adjustments	(653		)
Balance at June 30, 2018	$	532,251

During the fiscal year ended June 30, 2018, the Company recorded $41.9 million of goodwill in connection with acquisitions. Please refer to Note 9: "Acquisitions".

Intangible Assets

The useful lives of amortizing intangible assets are as follows:



Asset		Life
Intellectual property		1-10 years
Customer relationships		3-10 years
Trade name		1-4 years
Patents		5 years

Intangible assets consisted of the following:



	June 30, 2018						June 24, 2017
	Original Cost		Accumulated Amortization		Net		Original Cost		Accumulated Amortization		Net
	(in thousands)
Intellectual property	$	485,465	$	423,869	$	61,596	$	451,885	$	377,806	$	74,079
Customer relationships	116,294		103,217		13,077		115,634		99,812		15,822
Trade name	9,340		8,588		752		8,500		8,086		414
Patent	2,500		2,469		31		2,500		1,948		552
Total amortizable purchased intangible assets	613,599		538,143		75,456		578,519		487,652		90,867
IPR&D	2,790		—		2,790		—		—		—
Total purchased intangible assets	$	616,389	$	538,143	$	78,246	$	578,519	$	487,652	$	90,867

During the fiscal year ended June 30, 2018, $5.8 million of IPR&D, that was acquired during the fiscal year, was completed and reclassified to amortizable Intellectual Property. During the fiscal year ended June 24, 2017, $31.6 million of IPR&D was completed and reclassified to amortizable Intellectual Property.

During the fiscal year ended June 25, 2016, $20.3 million of purchased intangible assets, net, was included in the sale of the energy metering business line.

The following table presents the amortization expense of intangible assets and its presentation in the Consolidated Statements of Income:



	For the Year Ended
	June 30, 2018		June 24, 2017		June 25, 2016
	(in thousands)
Cost of goods sold	$	46,063	$	46,484	$	55,031
Intangible asset amortization	4,467		9,189		12,205
Total intangible asset amortization expenses	$	50,530	$	55,673	$	67,236

The following table represents the estimated future amortization expense of intangible assets as of June 30, 2018:



Fiscal Year	Amount
	(in thousands)
2019	$	24,180
2020	14,523
2021	12,823
2022	7,144
2023	6,660
Thereafter	10,126
Total intangible assets	$	75,456

- 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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