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Goodwill and Other Intangible Assets | 6 Months Ended
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Jun. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS GOODWILL The changes in the carrying value of goodwill are detailed below by segment:
| Oilfield Services | Oilfield Equipment | Turbo-machinery & Process Solutions | Digital Solutions | Total
Balance at December 31, 2016, gross | $ | 2,779 |  | $ | 3,852 |  | $ | 1,814 |  | $ | 1,989 |  | $ | 10,434 |
Accumulated impairment at December 31, 2016 | (2,633 | ) | (867 | ) | — |  | (254 | ) | (3,754 | )
Balance at December 31, 2016 | 146 |  | 2,985 |  | 1,814 |  | 1,735 |  | 6,680 |
Acquisition (1) | 13,052 |  | — |  | — |  | — |  | 13,052 |
Currency exchange and others | 7 |  | 49 |  | 92 |  | 47 |  | 195 |
Balance at December 31, 2017 | 13,205 |  | 3,034 |  | 1,906 |  | 1,782 |  | 19,927 |
Purchase accounting adjustments (1) | (154 | ) | 242 |  | 394 |  | 429 |  | 911 |
Currency exchange and others | (16 | ) | (36 | ) | (23 | ) | (5 | ) | (80 | )
Balance at June 30, 2018 | $ | 13,035 |  | $ | 3,240 |  | $ | 2,277 |  | $ | 2,206 |  | $ | 20,758 |
(1) | Includes goodwill associated with the acquisition of Baker Hughes. The final determination of fair value of the assets and liabilities and the related goodwill associated with the acquisition of Baker Hughes was concluded in the second quarter of 2018. Of the total goodwill of $13,963 million resulting from the acquisition of Baker Hughes, $12,898 million is allocated to our Oilfield Services segment and the remainder to our other segments based on the expected benefit from the synergies of the acquisition.
In addition to our annual impairment testing on July 1 each year, we also test goodwill for impairment between annual impairment testing dates whenever events or circumstances occur that, in our judgment, could more likely than not reduce the fair value of one or more reporting units below its carrying amount. In assessing the possibility that a reporting unit's fair value has been reduced below its carrying amount due to the occurrence of events or circumstances between annual impairment testing dates, we consider all available evidence, including (but not limited to) (i) the results of our impairment testing at the prior annual impairment testing date (in particular, the magnitude of the excess of fair value over carrying value observed), (ii) downward revisions to internal forecasts (and the magnitude thereof), if any, and (iii) declines in our market capitalization below our book value (and the magnitude and duration of those declines), if any. Since the merger with Baker Hughes, our Oilfield Equipment (OFE) reporting unit has had consecutive quarters of operating losses, which prompted the Company to evaluate whether circumstances had changed that would more likely than not reduce the fair value of the reporting unit below its carrying amount. While conducting this evaluation, the Company considered macroeconomic and industry conditions, overall financial performance of the reporting unit and preliminary long-term forecasts, among other factors, all of which require considerable judgment. After considering the totality of the events and circumstances, the Company concluded that an interim impairment test was not required. The Company will perform its annual goodwill impairment test during the third quarter of 2018 and there can be no assurance that the estimates and assumptions made for purposes of this qualitative evaluation will prove to be an accurate prediction of future results. Factors that could impact the final determination of fair value in connection with the completion of the annual goodwill impairment process include a sustained decline in market capitalization, changes in the estimated fair values of OFE’s assets and liabilities, changes in projected future earnings and net cash flows, changes in market related multiples, and changes in valuation related assumptions such as discount rates and perpetual growth rates. As of June 30, 2018, we believe that the goodwill is recoverable for all four reporting units, however, there can be no assurances that the goodwill will not be impaired in future periods. OTHER INTANGIBLE ASSETS Intangible assets are comprised of the following:
| June 30, 2018 | December 31, 2017
| Gross Carrying Amount | Accumulated Amortization | Net | Gross Carrying Amount | Accumulated Amortization | Net
Technology | $ | 1,102 |  | $ | (496 | ) | $ | 606 |  | $ | 1,177 |  | $ | (440 | ) | $ | 737 |
Customer relationships | 3,169 |  | (899 | ) | 2,270 |  | 3,202 |  | (819 | ) | 2,383 |
Capitalized software | 1,114 |  | (762 | ) | 352 |  | 1,130 |  | (697 | ) | 433 |
Trade names and trademarks | 726 |  | (223 | ) | 503 |  | 757 |  | (159 | ) | 598 |
Other | 14 |  | (1 | ) | 13 |  | 10 |  | — |  | 10 |
Finite-lived intangible assets | 6,125 |  | (2,381 | ) | 3,744 |  | 6,276 |  | (2,115 | ) | 4,161 |
Indefinite-lived intangible assets (1) | 2,229 |  | — |  | 2,229 |  | 2,197 |  | — |  | 2,197 |
Total intangible assets | $ | 8,354 |  | $ | (2,381 | ) | $ | 5,973 |  | $ | 8,473 |  | $ | (2,115 | ) | $ | 6,358 |
(1) | Indefinite-lived intangible assets are principally comprised of the Baker Hughes trade name.
Intangible assets are generally amortized on a straight-line basis with estimated useful lives ranging from 1 to 30 years. Amortization expense for the three months ended June 30, 2018 and 2017 was $101 million and $86 million, respectively, and $240 million and $149 million, respectively, for the six months ended June 30, 2018 and 2017. During the six months ended June 30, 2018, we incurred additional amortization expense of $68 million due to the acquisition of Baker Hughes. In addition, we incurred $32 million and $69 million of accelerated amortization during the three and six months ended June 30, 2018 related to trade names and technology that we ceased to use during the second quarter of 2018 as a result of the combination of Baker Hughes and GE O&G. Estimated amortization expense for the remainder of 2018 and each of the subsequent five fiscal years is expected to be as follows:
Year | Estimated Amortization Expense
Remainder of 2018 | $ | 185 |
2019 | 367 |
2020 | 331 |
2021 | 283 |
2022 | 247 |
2023 | 226 |

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- 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. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -URI http://asc.fasb.org/topic&trid=2144416 + Details
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