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These excerpts taken from the NDAQ 10-K filed Feb 27, 2009. 3. Business Combinations
We completed the following significant acquisitions in 2008:
Each of these significant acquisitions is discussed in more detail below.
In addition, we completed the following acquisitions and strategic initiative in 2008, 2007 and 2006:
2008
2007
2006
F-27
Table of ContentsThe NASDAQ OMX Group, Inc.
Notes to Consolidated Financial Statements—(Continued)
Further detail on these acquisitions and strategic initiative is summarized in tables below.
The results of operations of each acquisition and strategic initiative are included in our Consolidated Statements of Income from the dates of each acquisition and strategic initiative.
3. Business Combinations We completed the following significant acquisitions in 2008:
2008
2007
F-27 Table of ContentsThe NASDAQ OMX Group, Inc. Notes to Consolidated Financial Statements—(Continued)
The results of operations of each acquisition and strategic initiative are included in our Consolidated Statements of Income
This excerpt taken from the NDAQ 10-Q filed Nov 7, 2008. 3. Business Combinations We completed the following three acquisitions during the first nine months of 2008:
Each of these acquisitions is discussed in more detail below. In addition, on October 21, 2008, we completed our previously announced acquisition of Nord Pool’s clearing, international derivatives and consulting subsidiaries. Nord Pool is a world-leader in power derivatives trading and clearing, based in Norway. See Note 18, “Subsequent Events,” for further discussion of the Nord Pool acquisition. This excerpt taken from the NDAQ 8-K filed Feb 20, 2008. Business combinations Application of first time adoption IFRS 1 For financial reporting purposes, the cost of acquiring a business is allocated to the assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition for both IFRS and U.S. GAAP. Any excess of purchase cost over the fair values assigned to the acquired net assets is reported as goodwill. Under IFRS 1, a first time adopter may elect to not apply IFRS 3 business combinations fully retrospectively to business combinations completed in prior years. OMX adopted IFRS for the first time in 2005 and chose not to apply IFRS 3 to acquisitions prior to 2004 such as the acquisitions of the Helsinki Stock Exchange (“HEX”) and Stockholms Fondbörs. As a result, application of U.S. GAAP under SFAS 141 and 142, which require OMX to identify, measure, and separately account for intangible assets such as licenses, customer relationships, trademarks and technology apart from Goodwill, was not met. For this purpose, valuations were prepared using estimates and assumptions provided by management. As a result, OMX has identified a difference between U.S. GAAP and IFRS relating to its acquisitions of HEX and Stockholms Fondbörs. For both HEX and Stockholms Fondbörs, customer contracts for listing and issuance were identified as acquired intangible assets. Internal use software was also identified as an intangible asset for the Stockholms Fondbörs. The customer contracts were valued using a fair value model based on discounted cash flows for the related operations. The fair value of internal use software was identified based on the assessed repurchase value of the asset. The customer contracts are amortized over 20 years. The internal use software is amortized over 10 years. Stockholms Fondbörs: details of intangible assets, capitalized amounts and amortization
F-93
Helsinki Stock Exchange: Details of intangible assets, capitalized amounts and amortization
Goodwill amortization According to the U.S. accounting standard SFAS 142, Goodwill and Other Intangible Assets, applicable from January 2002, acquisition goodwill and other intangible assets that have indefinite useful lives are not amortized, but are instead tested for impairment annually. IFRS similarly requires annual testing of impairment. Prior to the implementation of IFRS in January 2004, OMX, under Swedish GAAP, amortized goodwill and other intangible assets over their expected useful lives. As a result, differences between U.S. GAAP and IFRS arise from the different dates of implementation. Cost of acquisition Under IFRS, equity shares issued as purchase consideration in a business combination are valued based on the weighted average trading price of the shares shortly before and after the date of the exchange transaction, which is the date when the acquirer obtains control over the acquiree’s net assets and operations. Under U.S. GAAP, such equity shares are valued based on the average share price for a reasonable period before and after the acquisition is publicly announced or, if the number of shares is uncertain on such date, the first day on which both the number of acquirer shares and the amount of other consideration becomes fixed. OMX has identified a difference between U.S. GAAP and IFRS relating to share value at OMX’s acquisitions of the Stockholm, Helsinki, Copenhagen and Iceland stock exchanges in the amount of $18.1 million, $(45.9) million, $2.8 million and $3.0 million, respectively. Such differences affect the amount of goodwill recorded. | EXCERPTS ON THIS PAGE:
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