Acquisitions, Intangible Assets And Goodwill

3 Months Ended

Apr. 01, 2012

Acquisitions, Intangible Assets And Goodwill [Abstract]

Acquisitions, Intangible Assets And Goodwill

B. ACQUISITIONS, INTANGIBLE ASSETS AND GOODWILL

In the first quarter of 2012, we acquired a fixed-base operation at Houston Hobby Airport that provides fuel, catering, maintenance, repair and overhaul services to private aircraft.

In 2011, we acquired six businesses for an aggregate of $1.6 billion, funded by cash on hand:

Combat Systems

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A provider of wheeled vehicles, survivability solutions and vehicle sustainment services for the armed forces of the United States and its allies (on December 19).

Marine Systems

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A surface-ship repair business in Norfolk, Virginia, that supports the U.S. Navy fleet (on October 31).

Information Systems and Technology

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A provider of enterprise services and cloud computing to the U.S. Department of Defense (on July 15).

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A provider of secure wireless networking equipment for the U.S. military and other government customers (on July 22).

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A provider of information assurance and security software (on August 12).

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A provider of health information technology services and business systems to federal agencies (on September 30).

The operating results of these acquisitions have been included with our reported results since their respective closing dates. The purchase prices of these acquisitions have been allocated preliminarily to the estimated fair value of net tangible and intangible assets acquired, with any excess purchase price recorded as goodwill.

Intangible assets consisted of the following:


	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
	December 31, 2011							April 1, 2012

Contract and program intangible assets*	$	2,393	$	(1,060	)	$	1,333	$	2,401	$	(1,105	)	$	1,296
Trade names and trademarks		477		(70	)		407		495		(77	)		418
Technology and software		175		(110	)		65		176		(115	)		61
Other intangible assets		174		(166	)		8		174		(166	)		8

Total intangible assets	$	3,219	$	(1,406	)	$	1,813	$	3,246	$	(1,463	)	$	1,783

*	Consists of acquired backlog and probable follow-on work and related customer relationships.

The amortization lives (in years) of our intangible assets on April 1, 2012, were as follows:


	Range of Amortization Life	Weighted Average Amortization Life

Contract and program intangible assets	7-30		17
Trade names and trademarks	30		30
Technology and software	7-13		11
Other intangible assets	7-15		11
Total intangible assets			20

We amortize intangible assets on a straight-line basis unless the pattern of usage of the benefits indicates an alternate method is more representative of the usage of the asset. Amortization expense was $58 and $57 for the three-month periods ended April 3, 2011, and April 1, 2012, respectively. We expect to record amortization expense of $225 in 2012 and over the next five years as follows:


2013	$	183
2014		162
2015		156
2016		127
2017		114

The changes in the carrying amount of goodwill by reporting unit for the three months ended April 1, 2012, were as follows:


	Aerospace		Combat Systems		Marine Systems		Information Systems and Technology		Total Goodwill
December 31, 2011	$	2,644	$	2,839	$	229	$	7,864	$	13,576
Acquisitions (a)		13		57		—		7		77
Other (b)		65		32		—		9		106

April 1, 2012	$	2,722	$	2,928	$	229	$	7,880	$	13,759

(a)	Includes adjustments during the purchase price allocation period.

(b)	Consists primarily of adjustments for foreign currency translation.

- 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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