Quarterly report pursuant to Section 13 or 15(d)

GOODWILL AND INTANGIBLE ASSETS

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GOODWILL AND INTANGIBLE ASSETS
 6 Months Ended
Jun. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]  
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS
 
Goodwill.   Goodwill represents the cost in excess of the fair value of the net assets acquired in a business combination. Goodwill is tested for impairment at the reporting unit level on an annual basis and on an interim basis if an event occurs or circumstances change that would reduce the fair value of a reporting unit below its carrying value. We perform our annual goodwill impairment tests as of September 30.
 
In the first quarter of 2016, we acquired Veda, which operates primarily in Australia and New Zealand. We have included Veda's operations within a newly-created Asia Pacific reporting unit within the International segment. Additionally, we moved the TDX Australia and India operations that were included in our Europe reporting unit to the Asia Pacific reporting unit to align with how we manage our business. Our financial results for the three and six months ended June 30, 2016 and 2015, reflect our new organizational structure. Additionally in 2016, we have renamed our Personal Solutions segment Global Consumer Solutions.

To reflect this new organizational structure, we have reallocated goodwill from the Europe reporting unit to the Asia Pacific reporting unit based on the relative fair values of the respective portions of Europe. A change in reporting units requires that goodwill be tested for impairment. During 2016, we performed goodwill impairment tests prior to and following the reallocation of goodwill, which resulted in no impairment.

Changes in the amount of goodwill for the six months ended June 30, 2016, are as follows:
 
 
 
U.S.
Information
Solutions
 
International
 
Workforce
Solutions
 
Global Consumer Solutions
 
Total
 
 
(In millions)
Balance, December 31, 2015
 
$
1,071.3

 
$
441.5

 
$
907.6

 
$
150.6

 
$
2,571.0

Acquisitions
 
—

 
1,403.4

 
—

 
—

 
1,403.4

Adjustments to initial purchase price allocation
 
—

 
0.9

 
—

 
—

 
0.9

Foreign currency translation
 
—

 
5.5

 
—

 
(9.2
)
 
(3.7
)
Balance, June 30, 2016
 
$
1,071.3

 
$
1,851.3

 
$
907.6

 
$
141.4

 
$
3,971.6



Indefinite-Lived Intangible Assets.   Indefinite-lived intangible assets consist of indefinite-lived reacquired rights representing the value of rights which we had granted to various affiliate credit reporting agencies that were reacquired in the U.S. and Canada. At the time we acquired these agreements, they were considered perpetual in nature under the accounting guidance in place at that time and, therefore, the useful lives are considered indefinite. Indefinite-lived intangible assets are not amortized. We are required to test indefinite-lived intangible assets for impairment annually and whenever events or circumstances indicate that there may be an impairment of the asset value. We perform our annual indefinite-lived intangible asset impairment test as of September 30. The estimated fair value of our indefinite-lived intangible assets exceeded the carrying value as of September 30, 2015. As a result, no impairment was recorded. Our indefinite-lived intangible asset carrying amounts did not change materially during the six months ended June 30, 2016.  
 
Purchased Intangible Assets.   Purchased intangible assets represent the estimated acquisition date fair value of acquired intangible assets used in our business. Purchased data files represent the estimated acquisition date fair value of consumer credit files acquired primarily through the purchase of independent credit reporting agencies in the U.S. and Canada and the Veda acquisition. We expense the cost of modifying and updating credit files in the period such costs are incurred. Our reacquired rights represent the value of rights which we had granted to Computer Sciences Corporation that were reacquired in connection with the acquisition of certain assets of CSC Credit Services (“CSC Credit Services Acquisition”) in the fourth quarter of 2012. These reacquired rights are being amortized over the remaining term of the affiliation agreement on a straight-line basis until August 1, 2018. We amortize all of our purchased intangible assets on a straight-line basis. For additional information about the useful lives related to our purchased intangible assets, see Note 1 of the Notes to Consolidated Financial Statements in our 2015 Form 10-K.

Purchased intangible assets at June 30, 2016 and December 31, 2015 consisted of the following:
 
 
June 30, 2016
 
December 31, 2015
 
 
Gross
 
Accumulated
Amortization
 
Net
 
Gross
 
Accumulated
Amortization
 
Net
Definite-lived intangible assets:
 
(In millions)
Purchased data files
 
$
1,024.6

 
$
(247.5
)
 
$
777.1

 
$
665.9

 
$
(240.6
)
 
$
425.3

Acquired software and technology
 
150.2

 
(40.6
)
 
109.6

 
52.4

 
(35.5
)
 
16.9

Customer relationships
 
723.5

 
(260.3
)
 
463.2

 
565.9

 
(239.3
)
 
326.6

Reacquired rights
 
73.3

 
(46.0
)
 
27.3

 
73.3

 
(39.4
)
 
33.9

Proprietary database
 
7.4

 
(6.0
)
 
1.4

 
7.4

 
(5.8
)
 
1.6

Non-compete agreements
 
28.2

 
(20.9
)
 
7.3

 
25.8

 
(18.3
)
 
7.5

Trade names and other intangible assets
 
57.8

 
(38.8
)
 
19.0

 
49.1

 
(33.0
)
 
16.1

Total definite-lived intangible assets
 
$
2,065.0

 
$
(660.1
)
 
$
1,404.9

 
$
1,439.8

 
$
(611.9
)
 
$
827.9


 
Amortization expense from continuing operations related to purchased intangible assets was $47.1 million and $31.2 million during the three months ended June 30, 2016 and 2015, respectively. Amortization expense from continuing operations related to purchased intangible assets was $82.8 million and $62.5 million during the six months ended June 30, 2016 and 2015, respectively.