Goodwill and Intangible Assets

12 Months Ended

Sep. 30, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

The following analysis details the changes in goodwill for each reportable segment:


	Recorded Music		Music Publishing		Total
	(in millions)
Balances at September 30, 2019	$	1,297	$	464	$	1,761
Acquisitions	47		—		47
Other adjustments	23		—		23
Balances at September 30, 2020	$	1,367	$	464	$	1,831
Acquisitions	(7)		—		(7)
Other adjustments	6		—		6
Balances at September 30, 2021	$	1,366	$	464	$	1,830

The decrease in goodwill during the fiscal year ended September 30, 2021 includes purchase price allocations for acquisitions closed during the fiscal year ended September 30, 2021 offset by measurement period adjustments for acquisitions which closed during the fiscal year ended September 30, 2020. The increase in goodwill during the fiscal year ended September 30, 2020 primarily relates to an acquisition in August 2020, which resulted in goodwill of $47 million. The other adjustments during both the fiscal years ended September 30, 2021 and September 30, 2020 primarily represent foreign currency movements.

The Company performs its annual goodwill impairment test in accordance with ASC 350 during the fourth quarter of each fiscal year as of July 1. The Company may conduct an earlier review if events or circumstances occur that would suggest the carrying value of the Company’s goodwill may not be recoverable. The performance of the annual fiscal 2021 impairment analysis did not result in an impairment of the Company’s goodwill.

Intangible Assets

Intangible assets consist of the following:


	Weighted-Average Useful Life	September 30, 2021		September 30, 2020
		(in millions)
Intangible assets subject to amortization:
Recorded music catalog	12 years	$	1,206	$	876
Music publishing copyrights	26 years	1,730		1,597
Artist and songwriter contracts	13 years	997		862
Trademarks	15 years	96		81
Other intangible assets	6 years	96		84
Total gross intangible assets subject to amortization		4,125		3,500
Accumulated amortization		(2,108)		(1,847)
Total net intangible assets subject to amortization		2,017		1,653
Intangible assets not subject to amortization:
Trademarks and tradenames	Indefinite	154		154
Total net intangible assets		$	2,171	$	1,807

The increase in intangible assets during the fiscal year ended September 30, 2021 primarily relates to certain acquisition transactions of music-related assets within recorded music catalogs, music publishing copyrights, and artist and songwriter contracts for approximately $471 million.

The Company performs its annual indefinite-lived intangible assets impairment test in accordance with ASC 350 during the fourth quarter of each fiscal year as of July 1. The Company may conduct an earlier review if events or circumstances occur that would suggest the carrying value of the Company’s indefinite-lived intangible assets may not be recoverable. The performance of the annual fiscal 2021 impairment analysis did not result in an impairment of the Company’s indefinite-lived intangible assets.

Amortization

Based on the amount of intangible assets subject to amortization at September 30, 2021, the expected amortization for each of the next five fiscal years and thereafter are as follows:


Fiscal Year Ended September 30,	Amortization Expense
	(in millions)
2022	$	233
2023	202
2024	162
2025	156
2026	140
Thereafter	1,124
Total	$	2,017

The life of all acquired intangible assets is evaluated based on the expected future cash flows associated with the asset. The expected amortization expense above reflects estimated useful lives assigned to the Company’s identifiable, finite-lived intangible assets primarily established in the accounting for the Merger and the acquisition of PLG.