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GOODWILL | 12 Months Ended
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Dec. 31, 2015
GOODWILL |
GOODWILL | 8. GOODWILL Bunge performs its annual goodwill impairment testing in the fourth quarter of each year. Step 1 of the goodwill impairment test compares the fair value of Bunge's reporting units to which goodwill has been allocated to the carrying values of those reporting units. The fair value of certain reporting units is determined using a combination of two methods: estimates based on market earnings multiples of peer companies identified for the reporting unit (the market approach) and a discounted cash flow model with estimates of future cash flows based on internal forecasts of revenues and expenses (the income approach). The market multiples are generally derived from public information related to comparable companies with operating and investing characteristics similar to those reporting units and from market transactions in the industry. The income approach estimates fair value by discounting a reporting unit's estimated future cash flows using a weighted-average cost of capital that reflects current market conditions and the risk profile of the respective business unit and includes, among other things, assumptions about variables such as commodity prices, crop and related throughput and production volumes, profitability, future capital expenditures and discount rates, all of which are subject to a high degree of judgment. For other reporting units, the estimated fair value of the reporting unit is determined utilizing a discounted cash flow analysis. Changes in the carrying value of goodwill by segment for the years ended December 31, 2015 and 2014 are as follows:
(US$ in millions) |  | Agribusiness |  | Edible Oil Products |  | Milling Products |  | Sugar and Bioenergy |  | Fertilizer |  | Total |
Goodwill |  | $ | 174 |  | $ | 99 |  | $ | 120 |  | $ | 514 |  | $ | 2 |  | $ | 909 |
Accumulated impairment losses |  |  | — |  |  | — |  |  | (3 | ) |  | (514 | ) |  | — |  |  | (517 | )
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Balance, December 31, 2013, net |  |  | 174 |  |  | 99 |  |  | 117 |  |  | — |  |  | 2 |  |  | 392 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Goodwill acquired(1) |  |  | — |  |  | — |  |  | 6 |  |  | — |  |  | — |  |  | 6 |
Impairment |  |  | (2 | ) |  | — |  |  | — |  |  | — |  |  | — |  |  | (2 | )
Tax benefit on goodwill amortization(2) |  |  | (5 | ) |  | — |  |  | — |  |  | — |  |  | — |  |  | (5 | )
Foreign exchange translation |  |  | (14 | ) |  | (13 | ) |  | (15 | ) |  | — |  |  | — |  |  | (42 | )
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Goodwill, gross of impairments |  |  | 155 |  |  | 86 |  |  | 111 |  |  | 514 |  |  | 2 |  |  | 868 |
Accumulated impairment losses |  |  | (2 | ) |  | — |  |  | (3 | ) |  | (514 | ) |  | — |  |  | (519 | )
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Balance, December 31, 2014, net |  |  | 153 |  |  | 86 |  |  | 108 |  |  | — |  |  | 2 |  |  | 349 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Goodwill acquired(1) |  |  | 2 |  |  | 6 |  |  | 141 |  |  | — |  |  | — |  |  | 149 |
Impairment(3) |  |  | — |  |  | (13 | ) |  | — |  |  | — |  |  | — |  |  | (13 | )
Tax benefit on goodwill amortization(2) |  |  | (3 | ) |  | — |  |  | — |  |  | — |  |  | — |  |  | (3 | )
Foreign exchange translation |  |  | (31 | ) |  | (14 | ) |  | (18 | ) |  | — |  |  | (1 | ) |  | (64 | )
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Goodwill, gross of impairments |  |  | 123 |  |  | 78 |  |  | 234 |  |  | 514 |  |  | 1 |  |  | 950 |
Accumulated impairment losses |  |  | (2 | ) |  | (13 | ) |  | (3 | ) |  | (514 | ) |  | — |  |  | (532 | )
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Balance, December 31, 2015, net |  | $ | 121 |  | $ | 65 |  | $ | 231 |  | $ | — |  | $ | 1 |  | $ | 418 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(1) | See Note 2.
(2) | Bunge's Brazilian subsidiary's tax deductible goodwill is in excess of its book goodwill. For financial reporting purposes for goodwill acquired prior to 2009, the tax benefits attributable to the excess tax goodwill are first used to reduce associated goodwill and then other intangible assets to zero, prior to recognizing any income tax benefit in the consolidated statements of income.
(3) | Goodwill impairment charge of $13 million represents all of the goodwill of the Brazilian tomato products business, recorded in the fourth quarter of 2015 upon completion of our annual impairment analysis. This analysis was performed using discounted cash flow projections (the income approach) to determine the fair value of the business unit. The income approach estimates fair value by discounting the business unit's estimated future cash flows using a discount rate that reflects current market conditions and the risk profile of the business and includes, among other things, making assumptions about variables such as our product pricing, future profitability and future capital expenditures that might be used by a market participant. All of these assumptions are subject to a high degree of judgment. Compared to 2014 there was a significant decline in the estimated fair value of the business unit primarily due to a decline in profitability. Based on a detailed review of the results of the impairment analysis, it was determined that impairment may exist and further analysis was performed to evaluate the fair value of the assets and liabilities of the business unit as of the October 1, 2015 testing date. Upon completion of the analysis, 100% of the goodwill was determined to be impaired and a related charge was recorded within the Edible Oils Segment. This non-cash charge does not have any impact on current or future cash flows or the performance of the underlying business.

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