Annual report pursuant to Section 13 and 15(d)

GOODWILL AND OTHER INTANGIBLE ASSETS

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GOODWILL AND OTHER INTANGIBLE ASSETS
12 Months Ended
Dec. 31, 2011
GOODWILL AND OTHER INTANGIBLE ASSETS

5.  GOODWILL AND OTHER INTANGIBLE ASSETS

 

Goodwill.   Goodwill represents the cost in excess of the fair value of the net assets acquired in a business combination. As discussed in Note 1, 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. As a result of the merger of our Brazilian business in the second quarter of 2011, we performed an interim impairment test on the Latin America reporting unit excluding our Brazilian business which resulted in no impairment. We perform our annual goodwill impairment tests as of September 30 each year. The fair value estimates for our reporting units were determined using a combination of the income and market approaches in accordance with the Company’s methodology. Our annual impairment tests as of September 30, 2011, 2010 and 2009 resulted in no impairment of goodwill.

 

Changes in the amount of goodwill for the twelve months ended December 31, 2011 and 2010, are as follows:

 

    U.S. Consumer           TALX     North America     North America        
    Information           Workforce     Personal     Commercial        
(In millions)   Solutions     International     Solutions     Solutions     Solutions     Total  
Balance, December 31, 2009   $ 667.8     $ 335.7     $ 900.6     $ 1.8     $ 37.3     $ 1,943.2  
Acquisitions     41.0       6.5       -       -       -       47.5  
Adjustments to initial purchase price allocation     (0.8 )     -       (0.7 )     -       -       (1.5 )
Foreign currency translation     -       4.7       -       -       0.3       5.0  
Businesses sold     (79.5 )     -       -       -       -       (79.5 )
Balance, December 31, 2010     628.5       346.9       899.9       1.8       37.6       1,914.7  
Acquisitions     10.1       30.9       34.6       -       -       75.6  
Adjustments to initial purchase price allocation     (0.2 )     (0.1 )     0.5       -       -       0.2  
Foreign currency translation     -       4.0       -       -       (0.1 )     3.9  
Businesses sold     -       (33.2 )     -       -       -       (33.2 )
Balance, December 31, 2011   $ 638.4     $ 348.5     $ 935.0     $ 1.8     $ 37.5     $ 1,961.2  

  

Indefinite-Lived Intangible Assets.   Indefinite-lived intangible assets consist of contractual/territorial rights representing the estimated fair value of rights to operate in certain territories acquired through the purchase of independent credit reporting agencies in the U.S. and Canada. Our contractual/territorial rights are perpetual in nature and, therefore, the useful lives are considered indefinite. Indefinite-lived intangible assets are not amortized. As discussed in Note 1, 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 each year. Our annual impairment tests as of September 30, 2011, 2010 and 2009 resulted in no impairment of our indefinite-lived intangible assets. Our contractual/territorial rights carrying amounts did not change materially during the twelve months ended December 31, 2011 and 2010.

 

Purchased Intangible Assets.   Purchased intangible assets net, recorded on our Consolidated Balance Sheets at December 31, 2011 and 2010, are as follows:

 

    December 31, 2011     December 31, 2010  
          Accumulated                 Accumulated        
    Gross     Amortization     Net     Gross     Amortization     Net  
    (In millions)  
Definite-lived intangible assets:                                                
Purchased data files   $ 316.2     $ (240.5 )   $ 75.7     $ 339.2     $ (240.7 )   $ 98.5  
Acquired software and technology     68.3       (41.1 )     27.2       55.0       (33.3 )     21.7  
Customer relationships     518.2       (130.3 )     387.9       489.2       (97.1 )     392.1  
Proprietary database     125.0       (95.5 )     29.5       125.0       (74.4 )     50.6  
Non-compete agreements     9.0       (3.1 )     5.9       7.2       (1.4 )     5.8  
Trade names and other intangible assets     40.7       (16.7 )     24.0       37.4       (12.2 )     25.2  
Total definite-lived intangible assets   $ 1,077.4     $ (527.2 )   $ 550.2     $ 1,053.0     $ (459.1 )   $ 593.9  

 

Amortization expense related to purchased intangible assets was $90.5 million, $90.0 million, and $80.3 million during the twelve months ended December 31, 2011, 2010, and 2009, respectively.

 

Estimated future amortization expense related to definite-lived purchased intangible assets at December 31, 2011 is as follows:

 

Years ending December 31,   Amount  
    (In millions)  
2012   $ 85.9  
2013     68.3  
2014     56.0  
2015     51.7  
2016     38.9  
Thereafter     249.4  
    $ 550.2