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.

Effective July 1, 2018, the Company reassigned goodwill to certain reporting units within the Light & Motion reportable segment resulting from a reorganization of the composition of reporting units. The goodwill was reassigned to the reporting units affected using the relative fair value approach. In conjunction with this goodwill reassignment, the Company performed an interim quantitative impairment test as of July 1, 2018 for all of its reporting units and concluded that the fair values of each reporting unit exceeded their respective carrying values.

Effective January 1, 2019, the Company reassigned goodwill to certain reporting units within the Light & Motion reportable segment resulting from a reorganization of the composition of goodwill reporting units. The goodwill was reassigned to the reporting units affected using the relative fair value approach. The Company also concluded that the fair value of each reporting unit exceeded its respective carrying value.

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


	2019									2018
	Gross Carrying Amount			Accumulated Impairment Loss			Net			Gross Carrying Amount			Accumulated Impairment Loss			Net
Beginning balance at January 1	$	731,272		$	(144,276	)	$	586,996		$	735,323		$	(144,276	)	$	591,047
Acquired goodwill(1)		473,951			—			473,951			—			—			—
Foreign currency translation		(2,493	)		—			(2,493	)		(4,051	)		—			(4,051	)

Ending balance at December 31	$	1,202,730		$	(144,276	)	$	1,058,454		$	731,272		$	(144,276	)	$	586,996

(1)	During the twelve months ended December 31, 2019, the Company recorded $ 473,951 of goodwill related to the ESI Merger.

Intangible Assets

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


As of December 31, 2019	Gross		Accumulated Impairment Charges			Accumulated Amortization			Foreign Currency Translation			Net
Completed technology(1)	$	446,431	$	(105	)	$	(178,310	)	$	(208	)	$	267,808
Customer relationships(1)		308,144		(1,406	)		(84,167	)		(1,361	)		221,210
Patents, trademarks, trade names and other		120,895		—			(45,505	)		222			75,612

	$	875,470	$	(1,511	)	$	(307,982	)	$	(1,347	)	$	564,630

(1)

During the twelve months ended December 31, 2019, the Company recorded $

316,200

of separately identified intangible assets related to the ESI Merger, of which $

274,000

was completed technology, $

25,400

was customer relationships and $

16,800

was trademarks, trade names and backlog. Separately, on January 1, 2019, the Company reclassified $

6,428

of gross favorable lease assets and $

3,445

of related accumulated amortization from patents, trademarks, trade names and other to the

right-of-use

asset line in the balance sheet.


As of December 31, 2018	Gross		Accumulated Impairment Charges			Accumulated Amortization			Foreign Currency Translation			Net
Completed technology	$	172,431	$	(105	)	$	(137,283	)	$	(73	)	$	34,970
Customer relationships		282,744		(1,406	)		(63,788	)		(269	)		217,281
Patents, trademarks, trade names and other		110,523		—			(42,954	)		(13	)		67,556

	$	565,698	$	(1,511	)	$	(244,025	)	$	(355	)	$	319,807

Aggregate amortization expense related to acquired intangible assets for the years 2019, 2018 and 2017 was $67,402, $43,521 and $45,743, respectively. The amortization expense in 2019, 2018 and 2017 is net of $0, $885 and $811, respectively, of amortization income from unfavorable lease commitments. Aggregate net amortization expense related to acquired intangible assets for future years is:


Year	Amount
2020	$	55,808
2021		47,720
2022		45,254
2023		44,902
2024		43,985
Thereafter	$	271,061

The Company excluded $55,900 of indefinite-lived trademarks and tradenames that were not subject to amortization from the table above.