BWA » Topics » (16) Goodwill

These excerpts taken from the BWA 10-K filed Feb 12, 2009.
Goodwill
 
The Company annually reviews its goodwill for impairment in the fourth quarter of each year for all of its reporting units, or when events and circumstances warrant such a review. This review utilizes the “two-step impairment test” required under Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangibles, and requires us to make significant assumptions and estimates about the extent and timing of future cash flows, discount rates and growth rates. The cash flows are estimated over a significant future period of time, which makes those estimates and assumptions subject to an even higher degree of uncertainty. We also utilize market valuation models and other financial ratios, which require us to make certain assumptions and estimates regarding the applicability of those models to our assets and businesses. We believe that the assumptions and estimates used to determine the estimated fair values of each of our reporting units are reasonable. However, different assumptions could materially affect the estimated fair value. The goodwill impairment test was performed in December and September 2008, December 2007 and December 2006. The Company recognized goodwill impairment of $156.8 million in the Engine segment in 2008 and $0.2 million in the Drivetrain segment in 2006. No goodwill impairment was recorded in 2007.
 
See Note 7 to the Consolidated Financial Statements for more information regarding goodwill.
 
Goodwill


 



The Company annually reviews its goodwill for impairment in the
fourth quarter of each year for all of its reporting units, or
when events and circumstances warrant such a review. This review
utilizes the “two-step impairment test” required under
Statement of Financial Accounting Standards No. 142,
Goodwill and Other Intangibles, and requires us to make
significant assumptions and estimates about the extent and
timing of future cash flows, discount rates and growth rates.
The cash flows are estimated over a significant future period of
time, which makes those estimates and assumptions subject to an
even higher degree of uncertainty. We also utilize market
valuation models and other financial ratios, which require us to
make certain assumptions and estimates regarding the
applicability of those models to our assets and businesses. We
believe that the assumptions and estimates used to determine the
estimated fair values of each of our reporting units are
reasonable. However, different assumptions could materially
affect the estimated fair value. The goodwill impairment test
was performed in December and September 2008, December 2007 and
December 2006. The Company recognized goodwill impairment of
$156.8 million in the Engine segment in 2008 and
$0.2 million in the Drivetrain segment in 2006. No goodwill
impairment was recorded in 2007.


 



See Note 7 to the Consolidated Financial Statements for
more information regarding goodwill.


 




This excerpt taken from the BWA 10-Q filed Jul 29, 2005.

(16) Goodwill

The changes in the carrying amount of goodwill for the six months ended June 30, 2005, are as follows:

(Millions) Drivetrain   Engine     Total  
 
 
   
 
Balance at December 31, 2004 $ 134.6   $ 726.2     $860.8  
Beru acquisition   -     189.0     189.0  
Translation adjustment   (0.5)     (31.3)     (31.8)  
   
   
   
 
Balance at June 30, 2005 $ 134.1   $ 883.9   $ 1,018.0  
 

 

 

 
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