We test goodwill for impairment at least annually and on an interim basis if an event or circumstance indicates that it is more likely than not that an impairment loss has been incurred. During the second quarter of 2022, we completed the annual goodwill impairment assessment. Due to a decline in our market capitalization, we performed our annual assessment on a quantitative basis for goodwill for each of our three reporting units. The result of our annual assessment was that the fair value of the North America, International and EMEA reporting units exceeded their carrying values as of our measurement date of May 31, 2022 and we concluded that no impairment existed.

During the third quarter of 2022, our market capitalization declined further compared to the second quarter of 2022. In addition, our forecasted cash flows for our North America and EMEA reporting units decreased due to lower inventory replenishment by major retailers, lower sales of gaming accessories, and a challenging demand environment in several countries within EMEA. As a result, we identified a triggering event indicating it was more likely than not that an impairment loss had been incurred. Accordingly, as of August 31, 2022, we completed a goodwill impairment assessment, on a quantitative basis, for goodwill for each of our three reporting units. The result of our assessment was that the fair value of the North America reporting unit did not exceed its carrying value resulting in an impairment charge of $98.7 million. The result of our assessment for International and EMEA reporting units was that the fair value of each exceeded its carrying values by greater than ten percent and fifty percent, respectively, and we concluded that no impairment existed.

Estimating the fair value of each reporting unit requires us to make assumptions and estimates regarding our future. We utilized a combination of both a discounted cash flows and market approach. The financial projections used in the valuation models reflected management's assumptions regarding revenue growth rates, economic and market trends, cost structure, discount rate, and other expectations about the anticipated short-term and long-term operating results for each of our three reporting units.

The fair values of our reporting units are considered a Level 3 measurement. Level 3 measurements require significant unobservable inputs that reflect assumptions used in our goodwill impairment analysis.

We believe the assumptions used in our goodwill impairment analysis are appropriate and result in reasonable estimates of the implied fair value of each reporting unit. However, given the economic environment and the uncertainties regarding the impact on our business, there can be no assurance that our estimates and assumptions, made for purposes of our goodwill impairment testing, will prove to be an accurate prediction of the future. If our assumptions regarding future performance are not achieved, we may be required to record additional goodwill impairment charges in future periods.

Changes in the net carrying amount of goodwill by segment were as follows:


(in millions)		ACCO Brands North America				ACCO Brands EMEA				ACCO Brands International				Total
Balance at December 31, 2020	$		461.2		$		188.2		$		178.0		$		827.4
Acquisitions(1)			(14.5	)			2.0				—				(12.5	)
Foreign currency translation			—				(11.6	)			(0.8	)			(12.4	)
Balance at December 31, 2021	$		446.7		$		178.6		$		177.2		$		802.5
Goodwill impairment			(98.7	)			—				—				(98.7	)
Foreign currency translation			—				(33.0	)			0.7				(32.3	)
Balance at December 31, 2022	$		348.0		$		145.6		$		177.9		$		671.5

(1)

Goodwill has been recorded on our Consolidated Balance Sheet related to the Franken acquisition, which is part of our EMEA segment, and represents the excess of the cost of the Franken acquisition when compared to the fair value estimate of the net assets acquired on April 1, 2021 (the date of the Franken acquisition). Goodwill has been recorded on our Consolidated Balance Sheet related to the PowerA acquisition and represents the excess of the cost of the PowerA acquisition when compared to the fair value estimate of the net assets acquired on December 17, 2020 (the date of the PowerA acquisition) and includes a working capital adjustment of $18.2 million recorded in the first quarter of 2021 as a reduction to the purchase price, partially offset by purchase accounting adjustments of $3.7 million. See "Note 3. Acquisitions" for additional details.

The valuation of identifiable intangible assets of $235.4 million acquired in the PowerA acquisition includes amortizable customer relationships, vendor relationships, trade names and developed technology, which have been recorded at their estimated fair values. The fair value of the customer relationships was determined using the multi-period excess earnings method which is based on the present value of the projected after-tax cash flows. The fair value of the vendor relationships was determined using the lost income method. The fair value of the trade name and the developed technology was determined using the relief from royalty method, which is based on the present value of royalty fees derived from projected revenues. The determination of the acquisition date fair value of the intangible assets required the Company to make significant estimates and assumptions regarding future revenue growth rates, future cost of sales, operating expenses and earnings before income tax, attrition rate, future cash flows without vendor relationships and discount rates.

The amortizable trade name, customer and vendor relationships are being amortized over 15 years while the developed technology is being amortized over 5 years on a straight-line basis. The allocation of the identifiable intangibles acquired in the PowerA acquisition was as follows:


(in millions)		Fair Value	Remaining Useful Life
Trade name	$	21.6	15 years
Customer relationships		128.6	15 years
Vendor relationships		82.4	15 years
Developed technology		2.8	5 years
Total identifiable intangibles acquired	$	235.4

The Company's gross carrying value and accumulated amortization by class of identifiable intangible assets as of December 31, 2022 and 2021 were as follows:


		December 31, 2022						December 31, 2021
(in millions)		Gross Carrying Amounts		Accumulated Amortization		Net Book Value		Gross Carrying Amounts		Accumulated Amortization		Net Book Value
Indefinite-lived intangible assets:
Trade names(1)	$	410.6	$	(44.5)	$	366.1	$	417.6	$	(44.5)	$	373.1
Amortizable intangible assets:
Trade names		369.7		(123.0)		246.7		373.2		(110.5)		262.7
Customer and contractual relationships		356.9		(198.2)		158.7		366.5		(182.4)		184.1
Vendor relationships		82.4		(11.2)		71.2		82.4		(5.7)		76.7
Patents		8.1		(3.8)		4.3		8.6		(3.0)		5.6
Subtotal		817.1		(336.2)		480.9		830.7		(301.6)		529.1
Total identifiable intangibles	$	1,227.7	$	(380.7)	$	847.0	$	1,248.3	$	(346.1)	$	902.2

(1)

Accumulated amortization prior to the adoption of authoritative guidance on goodwill and other intangible assets, at which time further amortization ceased.

The Company’s intangible amortization expense was $41.5 million, $46.3 million and $32.8 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Estimated amortization expense for amortizable intangible assets for the next five years is as follows:


(in millions)		2023		2024		2025		2026		2027
Estimated amortization expense(2)	$	43.3	$	41.7	$	40.1	$	38.0	$	35.6

(2)

Actual amounts of amortization expense may differ from estimated amounts due to changes in foreign currency exchange rates, additional intangible asset acquisitions, impairment of intangible assets, accelerated amortization of intangible assets and other events.

We test indefinite-lived intangibles for impairment at least annually and on an interim basis if an event or circumstance indicates that it is more likely than not that an impairment loss has been incurred. We performed this annual assessment, on a qualitative basis, for our indefinite-lived trade names and concluded that no impairment existed as of our measurement date of May 31, 2022.

During 2022, our revenue generated from our Leitz® indefinite-lived trade name declined. Accordingly, as of August 31, 2022, we completed an impairment assessment, on a quantitative basis, for our Leitz® indefinite-lived trade name. The result of our assessment was that the fair value of the Leitz® indefinite-lived trade name exceeded its carrying value by less than five percent and we concluded that no impairment existed.

The fair value of the trade name is considered a Level 3 measurement which utilizes a relief-from-royalty discounted cash flows approach. Key inputs and assumptions involved include the estimated near-term revenue growth, long-term growth rate, royalty rate, and discount rate.

As of December 31, 2022, we changed the indefinite-lived Leitz® trade name to an amortizable intangible asset. The change was made as a result of decisions regarding the Company's future use of the trade name. The Company will begin amortizing the Leitz® trade name on a straight-line basis over a life of 30 years effective January 1, 2023.