Identifiable Intangible Assets and Goodwill

NOTE 4 — Identifiable Intangible Assets and Goodwill

The following table summarizes the Company’s identifiable intangible asset balances as of May 31, 2012 and 2011:


	May 31, 2012							May 31, 2011
(In millions)	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Amortized intangible assets:
Patents	$	99	$	(29	)	$	70	$	80	$	(24	)	$	56
Trademarks		41		(26	)		15		44		(25	)		19
Other		94		(30	)		64		47		(22	)		25
TOTAL	$	234	$	(85	)	$	149	$	171	$	(71	)	$	100
Unamortized intangible assets — Trademarks							386							387
IDENTIFIABLE INTANGIBLE ASSETS, NET						$	535						$	487

The effect of foreign exchange fluctuations for the year ended May 31, 2012 decreased unamortized intangible assets by approximately $2 million, resulting from the strengthening of the U.S. Dollar in relation to the British Pound.

Amortization expense, which is included in selling and administrative expense, was $22 million, $16 million, and $14 million for the years ended May 31, 2012, 2011, and 2010, respectively. The estimated amortization expense for intangible assets subject to amortization for each of the years ending May 31, 2013 through May 31, 2017 are as follows: 2013: $21 million; 2014: $19 million; 2015: $15 million; 2016: $14 million; 2017: $13 million.

All goodwill balances are included in the Company’s “Other” category for segment reporting purposes. The following table summarizes the Company’s goodwill balance as of May 31, 2012 and 2011:


(In millions)	Goodwill			Accumulated Impairment			Goodwill, net
May 31, 2010	$	387		$	(199	)	$	188
Umbro France⁽¹⁾		10			0			10
Other⁽²⁾		7			0			7
May 31, 2011		404			(199	)		205
Other⁽²⁾		(4	)		0			(4	)
MAY 31, 2012	$	400		$	(199	)	$	201

(1)

In March 2011, Umbro acquired the remaining 51% of the exclusive licensee and distributor of the Umbro brand in France for approximately $15 million.

(2)

Other consists of foreign currency translation adjustments on Umbro goodwill.

- 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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