Goodwill and Other Intangible Assets

6 Months Ended

Jun. 30, 2014

Goodwill and Other Intangible Assets [Abstract]

Changes in the carrying amount of goodwill for the six months ended June 30, 2014 and the year ended December 31, 2013, by reporting unit, are as follows (in millions):



	Beverage Concentrates		WD Reporting Unit⁽¹⁾		DSD Reporting Unit⁽¹⁾			Latin America Beverages		Total
Balance as of January 1, 2013
Goodwill	$	1,732	$	1,220	$	180		$	31	$	3,163
Accumulated impairment losses	—		—		(180		)	—		(180		)
	1,732		1,220		—			31		2,983
Acquisition activity⁽²⁾	—		—		5			—		5
Balance as of December 31, 2013
Goodwill	1,732		1,220		185			31		3,168
Accumulated impairment losses	—		—		(180		)	—		(180		)
	1,732		1,220		5			31		2,988
Foreign currency impact	—		—		—			—		—
Balance as of June 30, 2014
Goodwill	1,732		1,220		185			31		3,168
Accumulated impairment losses	—		—		(180		)	—		(180		)
	$	1,732	$	1,220	$	5		$	31	$	2,988

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(1)	The Packaged Beverages segment is comprised of two reporting units, the Direct Store Delivery ("DSD") system and the Warehouse Direct ("WD") system.


(2)	The acquisition activity represents the goodwill associated with the purchase of DP/7UP Bottling Company of the West in 2013.

The net carrying amounts of intangible assets other than goodwill as of June 30, 2014 and December 31, 2013 are as follows (in millions):



	June 30, 2014							December 31, 2013
	Gross		Accumulated			Net		Gross		Accumulated			Net
	Amount		Amortization			Amount		Amount		Amortization			Amount
Intangible assets with indefinite lives:
Brands	$	2,652	$	—		$	2,652	$	2,652	$	—		$	2,652
Distribution rights	24		—			24		24		—			24
Intangible assets with finite lives:
Brands	29		(27		)	2		29		(27		)	2
Distribution rights	13		(4		)	9		12		(3		)	9
Customer relationships	76		(70		)	6		76		(69		)	7
Bottler agreements	19		(19		)	—		19		(19		)	—
Total	$	2,813	$	(120	)	$	2,693	$	2,812	$	(118	)	$	2,694

As of June 30, 2014, the weighted average useful life of intangible assets with finite lives was 10 years for distribution rights, brands, customer relationships and in total. Amortization expense for intangible assets was $1 million and $2 million for the three and six months ended June 30, 2014, respectively, and $2 million and $3 million for the three and six months ended June 30, 2013, respectively.

Amortization expense of these intangible assets over the remainder of 2014 and the next four years is expected to be the following (in millions):



Year	Aggregate Amortization Expense
July 1, 2014 through December 31, 2014	$	2
2015	6
2016	3
2017	1
2018	1

The Company conducts impairment tests on goodwill and all indefinite-lived intangible assets annually or more frequently if circumstances indicate that the carrying amount of an asset may not be recoverable. DPS did not identify any circumstances that indicated that the carrying amount of any goodwill or any indefinite-lived intangible asset may not be recoverable as of June 30, 2014.

- 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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