Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2012

Goodwill and Other Intangible Assets [Abstract]

Note 3 – Goodwill and Other Intangible Assets

Goodwill represents the excess of the cost of a business acquired over the fair value of the related net assets at the date of acquisition. Goodwill is not amortized but rather tested for impairment at least annually. The required annual impairment test of goodwill is completed as of the first day of the fourth fiscal quarter of each year. These impairment tests must be performed more frequently whenever events or changes in circumstances indicate that the asset might be impaired. The Company's business segments (see Note 15) represent its reporting units for goodwill impairment testing purposes.

Vishay recorded goodwill impairment charges in the year ended December 31, 2008. Subsequent to the goodwill impairment charges recorded in 2008, there was no remaining goodwill recorded on the consolidated balance sheet until the acquisition of the resistor businesses of Huntington Electric on September 28, 2011.

The changes in the carrying amount of goodwill by segment for the years ended December 31, 2012 and 2011 were as follows:

	Resistors & Inductors		Total

Balance at January 1, 2011	$	-	$	-
Huntington Electric acquisition		9,051		9,051
Balance at December 31, 2011	$	9,051	$	9,051
HiRel Systems acquisition		25,815		25,815
Balance at December 31, 2012	$	34,866	$	34,866

Other intangible assets are as follows:

	December 31,
	2012			2011

Intangible Assets Subject to Amortization
(Definite-lived):
Patents and acquired technology	$	83,383		$	111,428
Capitalized software		56,162			53,721
Customer relationships		97,451			57,723
Tradenames		34,534			36,762
Non-competition agreements		1,700			1,000
		273,230			260,634
Accumulated amortization:
Patents and acquired technology		(61,269	)		(89,379	)
Capitalized software		(50,161	)		(47,836	)
Customer relationships		(33,416	)		(26,174	)
Tradenames		(14,579	)		(13,615	)
Non-competition agreements		(447	)		(62	)
		(159,872	)		(177,066	)
Net Intangible Assets Subject to Amortization		113,358			83,568

Intangible Assets Not Subject to Amortization
(Indefinite-lived):
Tradenames		20,359			20,359
	$	133,717		$	103,927

Note 3 – Goodwill and Other Intangible Assets (continued)

The increase in net intangible assets from December 31, 2011 is mainly attributable to the acquisition of HiRel Systems LLC on January 13, 2012. The Company allocated $43,950 of the purchase price to definite-lived intangible assets. Net intangible assets of $15,371 were transferred to VPG on July 6, 2010. Amortization expense (excluding capitalized software) was $14,754, $14,684, and $19,817, for the years ended December 31, 2012, 2011, and 2010, respectively. HiRel Systems LLC intangible assets accounted for $2,670 of amortization expense for the year ended December 31, 2012. VPG intangible assets accounted for $1,466 of amortization expense for the year ended December 31, 2010.

Estimated annual amortization expense of intangible assets on the balance sheet at December 31, 2012 for each of the next five years is as follows:

2013	$	15,331
2014		15,263
2015		15,196
2016		13,522
2017		9,654

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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