Intangible Assets and Goodwill

6 Months Ended

Jun. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

The following presents certain information regarding our intangible assets as of June 30, 2014 and December 31, 2013. Amortizable intangible assets are primarily being amortized on a straight-line basis over their estimated useful lives with no estimated residual values.



Intangible Assets	Gross Carrying Amount		Accumulated Amortization		Net Balance
Balance as of June 30, 2014
Amortizable intangible assets:
Patents	$	16.4	$	7.8	$	8.6
Customer lists	162.1		33.3		128.8
Licenses	302.6		72.0		230.6
Intellectual property	8.8		6.4		2.4
Brand name	39.3		2.8		36.5
Non-compete agreements	0.4		0.2		0.2
Lottery contracts	1.5		1.4		0.1
	531.1		123.9		407.2
Non-amortizable intangible assets:
Trade name	105.2		2.1		103.1
Total intangible assets	$	636.3	$	126.0	$	510.3

Balance as of December 31, 2013
Amortizable intangible assets:
Patents	$	14.5	$	7.1	$	7.4
Customer lists	161.9		24.0		137.9
Licenses	181.0		59.9		121.1
Intellectual property	8.6		5.7		2.9
Brand name	39.3		0.6		38.7
Non-compete agreements	0.4		0.2		0.2
Lottery contracts	1.5		1.4		0.1
	407.2		98.9		308.3
Non-amortizable intangible assets:
Trade name	104.9		2.1		102.8
Total intangible assets	$	512.1	$	101.0	$	411.1

The increase in the carrying amount of licenses for the six months ended June 30, 2014 primarily reflected the recording of approximately $106 million associated with a long-term license agreement which was amended and extended in the first quarter of 2014. The carrying value of the licensed asset increased to reflect the additional minimum guarantees of royalties under the amended license agreement. For additional information regarding licensed assets with minimum guarantees, see Note 1 in our 2013 Annual Report on Form 10-K.

The aggregate intangible amortization expense for the three and six months ended June 30, 2014 was $16.3 million and $30.9 million, respectively. The aggregate intangible amortization expense for the three and six months ended June 30, 2013 was $4.9 million and $9.8 million, respectively. These amounts are included in depreciation and amortization in our Consolidated Statements of Operations and Comprehensive Loss.

Goodwill

The table below reconciles the change in the carrying amount of goodwill by reporting segment from December 31, 2012 to June 30, 2014.



Goodwill	Instant Products			Lottery Systems			Gaming		Totals
Balance as of December 31, 2012	$	328.0		$	210.7		$	262.7	$	801.4
Acquisitions	—			—			385.6		385.6
Impairments	(5.4		)	—			—		(5.4		)
Foreign currency adjustments	(2.4		)	2.7			5.0		5.3
Reallocation of goodwill	20.0			(39.7		)	19.7		—
Balance as of December 31, 2013	340.2			173.7			673.0		1,186.9
Foreign currency adjustments	0.3			1.7			8.9		10.9
Balance as of June 30, 2014	$	340.5		$	175.4		$	681.9	$	1,197.8

- 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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