Goodwill and Intangible Assets, Net

12 Months Ended

Dec. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

The following table presents the changes in the carrying amount of goodwill, by reportable segment:


(in millions)	Commercial		Government		Transportation		Total
Balance at December 31, 2020	$	837	$	623	$	68	$	1,528
Foreign currency translation	(14)		(6)		(7)		(27)


Assets Held For Sale	(162)		—		—		(162)

Balance at December 31, 2021	$	661	$	617	$	61	$	1,339
Foreign currency translation	(20)		(2)		(4)		(26)

Impairment	(358)		—		—		(358)

Transfer of goodwill between segments	4		(4)		—		—
Balance at December 31, 2022	$	287	$	611	$	57	$	955

Gross goodwill	$	2,198	$	1,365	$	637	$	4,200
Accumulated impairment	(1,911)		(754)		(580)		(3,245)
Balance at December 31, 2022	$	287	$	611	$	57	$	955

As of January 1, 2022, the Company underwent an internal reorganization in its Commercial reportable segment resulting in the previous four Commercial operating segments being combined into one single operating segment and reporting unit, led by a single segment manager.

The Company considered the reorganization in the first quarter of 2022 a triggering event and performed an interim qualitative goodwill impairment assessment of the reporting units before and after the reorganization and concluded no impairment existed at the time of the change.

Additionally, as part of the reorganization in the first quarter of 2022, certain clients were reassigned from the Government reportable segment to the Commercial reportable segment. This change resulted in less than 1% of goodwill being reallocated between the reporting units within the two reportable segments.

The Company performed its annual goodwill impairment test as of October 1, 2022. This testing did not identify any goodwill impairment and, accordingly, no impairment charge was recorded.

Impairment Charge

After completing the annual impairment test, the Commercial reporting unit experienced lower than expected new customer contract signings (all subsequent to November 1, 2022), and an unexpected softening of the future business pipeline for certain solutions. Management believed these were driven by macroeconomic conditions present in the fourth quarter of 2022. The combination of these factors led management, in December 2022, to review the Commercial reporting unit and further evaluate the portfolio. These factors triggered the need for management to perform a goodwill impairment assessment for this reporting unit as of December 31, 2022, which resulted in a pre-tax impairment charge of $358 million.

The fair values of the goodwill impairment charge were estimated based on a determination of the implied fair value of goodwill, leveraging the results from the Income Approach and Market Approach, and are designated as level 3 of the fair value hierarchy.

In connection with the Commercial reporting unit impairment assessment, the Company first performed a recoverability assessment of long-lived assets and concluded that such assets were not impaired.

Intangible Assets, Net

Net intangible assets were $39 million at December 31, 2022 of which $37 million, $2 million and $0 million relate to the Company's Commercial, Government and Transportation segments, respectively. Intangible assets were comprised exclusively of Customer relationships as follows:


		December 31, 2022						December 31, 2021
(in millions, except years)	Weighted Average Amortization	Gross Carrying Amount		Accumulated Amortization		Net Amount		Gross Carrying Amount		Accumulated Amortization		Net Amount


Total Intangible Assets	14 years	$	95	$	56	$	39	$	1,658	$	1,606	$	52

Amortization expense related to intangible assets was $13 million, $135 million and $239 million for the years ended December 31, 2022, 2021 and 2020, respectively. Amortization expense is expected to approximate $7 million in 2023, $5 million in 2024, $4 million in 2025, $4 million in 2026 and $3 million in 2027.