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Goodwill and Other Intangible Assets | 12 Months Ended
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Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill Changes in the carrying value of goodwill by reportable segment during the years ended December 31, 2021 and 2020 are as follows:
(in millions) | Water Infrastructure |  | Applied Water |  | Measurement & Control Solutions |  | Total
Balance as of December 31, 2019 | $ | 651 |  |  | $ | 513 |  |  | $ | 1,675 |  |  | $ | 2,839 |
Activity in 2020 |  |  |  |  |  |  |
Impairment | — |  |  | — |  |  | (58) |  |  | (58) |
Foreign currency and other | 17 |  |  | 16 |  |  | 40 |  |  | 73 |
Balance as of December 31, 2020 | $ | 668 |  |  | $ | 529 |  |  | $ | 1,657 |  |  | $ | 2,854 |
Activity in 2021 |  |  |  |  |  |  |
Foreign currency and other | (12) |  |  | (14) |  |  | (36) |  |  | (62) |
Balance as of December 31, 2021 | $ | 656 |  |  | $ | 515 |  |  | $ | 1,621 |  |  | $ | 2,792 |
As of December 31, 2021 and 2020, goodwill included accumulated impairment losses of $206 million, within the Measurement & Control Solutions segment. During the fourth quarter of 2021, we performed our annual impairment assessment and determined that the estimated fair values of our goodwill reporting units were in excess of each of their carrying values. However, future goodwill impairment tests could result in a charge to earnings. We will continue to evaluate goodwill on an annual basis as of the beginning of our fourth quarter and whenever events and changes in circumstances indicate there may be a potential impairment. During the third quarter of 2020, the Company recorded a goodwill impairment charge of $58 million related to the Advanced Infrastructure Analytics ("AIA") goodwill reporting unit within our Measurement & Control Solutions segment. The AIA goodwill reporting unit is comprised of our assessment services business (primarily the Pure Technologies Ltd. acquisition) as well as our digital solutions business. The impairment resulted from management's updated forecast of future cash flows for the AIA businesses, which reflected significant negative volume impacts from the COVID-19 pandemic, primarily on our assessment services business. Our ongoing investment in the AIA businesses also continues to impact near term profitability. These factors drove the decrease in forecasted cash flows, and as such, the calculated fair value of the AIA goodwill reporting unit below its carrying value as of the third quarter. To determine the fair value of the AIA goodwill reporting unit, the Company used the income approach, which is considered a Level 3 input for fair value measurement. Under the income approach, the fair value of the AIA goodwill reporting unit was based on the present value of the estimated cash flows that the goodwill reporting unit is expected to generate over its remaining life. Cash flow projections were based on management’s estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions. The discount rate was based on the weighted average cost of capital appropriate for the AIA goodwill reporting unit. During the third quarter of 2019, the Company recorded a goodwill impairment charge of $148 million related to the AIA goodwill reporting unit. The impairment resulted from a downward revision of forecasted future cash flows. Factors that contributed to the revised forecast in the third quarter include lower than expected results as compared to prior forecasts, largely as a result of slower-than-expected conversion of pipeline opportunities to revenue. Additionally, we have continued to invest in the AIA platform ahead of the adoption curve, which has also impacted the near-term profitability of the business. These factors drove the decrease in forecasted cash flows, and as such, the calculated fair value of the AIA goodwill reporting unit below its carrying value as of the third quarter. To determine the fair value of the AIA goodwill reporting unit, the Company used the income approach, which is considered a Level 3 input for fair value measurement. Other Intangible Assets Information regarding our other intangible assets is as follows:
(in millions) | December 31, 2021 |  | December 31, 2020
| Carrying Amount |  | Accumulated Amortization |  | Net Intangibles |  | Carrying Amount |  | Accumulated Amortization |  | Net Intangibles
Customer and distributor relationships | $ | 929 |  |  | $ | (456) |  |  | $ | 473 |  |  | $ | 941 |  |  | $ | (410) |  |  | $ | 531 |
Proprietary technology and patents | 201 |  |  | (142) |  |  | 59 |  |  | 206 |  |  | (131) |  |  | 75 |
Trademarks | 141 |  |  | (72) |  |  | 69 |  |  | 143 |  |  | (63) |  |  | 80 |
Software | 548 |  |  | (303) |  |  | 245 |  |  | 500 |  |  | (265) |  |  | 235 |
Other | 21 |  |  | (18) |  |  | 3 |  |  | 21 |  |  | (18) |  |  | 3 |
Indefinite-lived intangibles | 167 |  |  | — |  |  | 167 |  |  | 169 |  |  | — |  |  | 169 |
Other intangibles | $ | 2,007 |  |  | $ | (991) |  |  | $ | 1,016 |  |  | $ | 1,980 |  |  | $ | (887) |  |  | $ | 1,093 |
We determined that no impairment of the indefinite-lived intangibles existed as of the measurement date of our impairment assessment in 2021. Future impairment tests could result in a charge to earnings. We will continue to evaluate the indefinite-lived intangible assets on an annual basis as of the beginning of our fourth quarter and whenever events and changes in circumstances indicate there may be a potential impairment. During the third quarter of 2020, the Company assessed whether the carrying amounts of the AIA reporting unit’s long-lived assets may not be recoverable based on the updated forecast of future cash flows, and therefore impaired. Our assessment resulted in an impairment charge of $11 million, primarily related to software and proprietary technology. The charge was calculated using an income approach, which is considered a Level 3 input for fair value measurement, and is reflected in “Restructuring and asset impairment charges” in our Consolidated Income Statements. During the second quarter of 2020, we recognized impairment charges of $16 million primarily related to customer relationships and trademarks due to discontinuance of a product line within our Measurement & Control Solutions segment. We also determined that internally developed in-process software within our Measurement & Control Solutions segment was impaired as a result of actions taken to prioritize strategic investments and recognized an impairment charge of $10 million. During the third quarter of 2019, the Company also assessed whether the carrying amounts of the AIA reporting unit’s long-lived assets may not be recoverable based on the revised forecasted cash flows, and therefore impaired. Our assessment resulted in an impairment charge of $7 million, primarily related to customer relationships, proprietary technology, software and property, plant and equipment. The charge was calculated using an income approach, which is considered a Level 3 input for fair value measurement, and is reflected in “Restructuring and asset impairment charges” in our Consolidated Income Statements. During the first quarter of 2019, we determined that the intended use of a finite-lived customer relationship within the test application of our Measurement & Control Solutions segment had changed. Accordingly we recorded a $3 million impairment charge. The charge was also calculated using the income approach, and is reflected in “Restructuring and asset impairment charges” in our Consolidated Income Statements. Customer and distributor relationships, proprietary technology and patents, trademarks, software and other are amortized over weighted average lives of approximately 15 years, 15 years, 13 years, 4 years and 5 years, respectively. Total amortization expense for intangible assets was $127 million, $134 million, and $140 million for 2021, 2020 and 2019, respectively. Estimated amortization expense for each of the five succeeding years is as follows:
(in millions) |
2022 | $ | 124 |
2023 | 119 |
2024 | 111 |
2025 | 104 |
2026 | 97 |

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