Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

11)

Goodwill and Intangible Assets

Goodwill

The Company’s methodology for allocating the purchase price relating to purchase acquisitions is determined through established and generally accepted valuation techniques. Goodwill is measured as the excess of the cost of the acquisition over the sum of the amounts assigned to tangible and identifiable intangible assets acquired less liabilities assumed. The Company assigns assets acquired (including goodwill) and liabilities assumed to one or more reporting units as of the date of acquisition. Typically acquisitions relate to a single reporting unit and thus do not require the allocation of goodwill to multiple reporting units. If the products obtained in an acquisition are assigned to multiple reporting units, the goodwill is distributed to the respective reporting units as part of the purchase price allocation process.

Goodwill and purchased intangible assets with indefinite useful lives are not amortized, but are reviewed for impairment annually during the fourth quarter of each fiscal year and whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The process of evaluating the potential impairment of goodwill and intangible assets requires significant judgment. The Company regularly monitors current business conditions and other factors including, but not limited to, adverse industry or economic trends, restructuring actions and lower projections of profitability that may impact future operating results.

The changes in the carrying amount of goodwill and accumulated impairment losses were as follows:


	2017									2016
	Gross Carrying Amount			Accumulated Impairment Loss			Net			Gross Carrying Amount			Accumulated Impairment Loss			Net
Beginning balance at January 1	$	727,999		$	(139,414	)	$	588,585		$	339,117		$	(139,414	)	$	199,703
Acquired goodwill(1)		—			—			—			396,027			—			396,027
Sale of business(2)		(3,115	)		—			(3,115	)		—			—			—
Impairment loss(3)		—			(4,862	)		(4,862	)		—			—			—
Foreign currency translation		10,439			—			10,439			(7,145	)		—			(7,145	)

Ending balance at December 31	$	735,323		$	(144,276	)	$	591,047		$	727,999		$	(139,414	)	$	588,585

(1)	During 2016, the Company recorded $396,027 of goodwill related to the Newport Merger.

(2)	In 2017, the Company sold its Data Analytics business and, as a result, charged the related goodwill of $3,115 to the gain on sale of business.

(3)	In 2017, the Company recorded an impairment loss of $4,862 related to the write-off of goodwill as a result of the discontinuation of a product line and consolidation of two manufacturing plants.

Intangible Assets

The Company is required to test certain long-lived assets when indicators of impairment are present. For the purposes of the impairment test, long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. During 2017, the Company recorded impairment charges of $1,511 related to the write off of intangible assets as a result of the discontinuation of a product line and consolidation of two manufacturing plants. There were no intangible asset impairment charges in 2016 or 2015.

Components of the Company’s acquired intangible assets are comprised of the following:


As of December 31, 2017	Gross		Impairment Charges			Accumulated Amortization			Foreign Currency Translation			Net
Completed technology(1)	$	172,431	$	(105	)	$	(115,371	)	$	333		$	57,288
Customer relationships(1)		282,744		(1,406	)		(45,518	)		1,571			237,391
Patents, trademarks, trade names and other(1)		110,523		—			(38,730	)		(74	)		71,719

	$	565,698	$	(1,511	)	$	(199,619	)	$	1,830		$	366,398


As of December 31, 2016	Gross		Impairment Charges		Accumulated Amortization			Foreign Currency Translation			Net
Completed technology(2)	$	176,586	$	—	$	(97,707	)	$	(1,068	)	$	77,811
Customer relationships(2)		285,044		—		(29,709	)		(3,404	)		251,931
Patents, trademarks, trade names and other(2)		111,723		—		(33,397	)		(64	)		78,262

	$	573,353	$	—	$	(160,813	)	$	(4,536	)	$	408,004

(1)	In 2017, the Company sold its Data Analytics business and, as a result, wrote off the related intangibles of $4,155 of completed technology, $2,300 of customer relationships and $1,200 of patents, trademarks, trade names and other, which were fully amortized at the time of sale.

(2)

During 2016, the Company recorded $404,506 of separately identified intangible assets related to the Newport Merger, of which $75,386 was completed technology, $247,793 was customer relationships and $81,327 was patents, trademarks, trade names, in-process research and development and other. The Company also recorded $4,302 of unfavorable lease commitments, which is recorded in other liabilities in the balance sheet.

Aggregate amortization expense related to acquired intangible assets for the years 2017, 2016 and 2015 was $45,743, $35,681 and $6,764, respectively. The amortization expense in 2017 and 2016 is net of $811 and $569, respectively, of amortization income from unfavorable lease commitments. Aggregate net amortization expense related to acquired intangible assets and unfavorable lease commitments for future years is:


Year	Amount
2018	$	43,404
2019		40,333
2020		28,262
2021		20,464
2022		17,703
Thereafter		157,360

- 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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