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Goodwill And Other Intangible Assets
9 Months Ended
Jul. 01, 2011
Goodwill And Other Intangible Assets  
Goodwill And Other Intangible Assets
(5)   GOODWILL AND OTHER INTANGIBLE ASSETS:

Goodwill represents the excess of the fair value of an acquired entity less the fair value assigned to the assets acquired and liabilities assumed in a business combination. Goodwill is not amortized and is subject to an impairment test that we conduct annually or more frequently if a change in circumstances or the occurrence of events indicates that potential impairment exists, using discounted cash flows. During the second quarter of fiscal 2011, the Company recorded an impairment charge of $5.3 million in the Food and Support Services—International segment in order to write off all of the goodwill (approximately $4.0 million) and other intangible assets (approximately $1.3 million) associated with its India operations. The impairment charge is included in "Cost of services provided" in the Condensed Consolidated Statement of Operations. The impairment charge primarily resulted from a change in the strategic direction of the business and continuing operating losses due to competitive pressures. To determine the amount of the impairment charge, the Company concluded that the carrying value exceeded the estimated fair value of the India operating unit. The Company estimated the fair value using a discounted cash flow valuation methodology, which included making assumptions about the future profitability and cash flows of the business. Changes in total goodwill during the nine months ended July 1, 2011 follow (in thousands):

 

Segment

   October 1, 2010      Acquisitions and
Divestitures
    Impairment     Translation      July 1, 2011  

Food and Support Services—North America

   $ 3,478,479       $ 134,905      $ —        $ 33       $ 3,613,417   

Food and Support Services—International

     471,354         (2,613     (4,017     14,478         479,202   

Uniform and Career Apparel

     600,869         406        —          —           601,275   
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

 
   $ 4,550,702       $ 132,698      $ (4,017   $ 14,511       $ 4,693,894   
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

 

The amounts for acquisitions during fiscal 2011 may be revised upon final determination of the purchase price allocations.

Other intangible assets consist of (in thousands):

 

     July 1, 2011      October 1, 2010  
     Gross
Amount
     Accumulated
Amortization
    Net
Amount
     Gross
Amount
     Accumulated
Amortization
    Net
Amount
 

Customer relationship assets

   $ 1,873,165       $ (826,815   $ 1,046,350       $ 1,828,400       $ (677,538   $ 1,150,862   

Trade names

     767,524         (299     767,225         762,932         (160     762,772   
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

 
   $ 2,640,689       $ (827,114   $ 1,813,575       $ 2,591,332       $ (677,698   $ 1,913,634   
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

 

Acquisition-related intangible assets consist of customer relationship assets, the ARAMARK trade name and other trade names. Customer relationship assets are being amortized principally on a straight-line basis over the expected period of benefit, 3 to 24 years, with a weighted average life of approximately 11 years. The ARAMARK and Seamless trade names are indefinite lived intangible assets and are not amortizable but are evaluated for impairment at least annually.

Amortization of intangible assets for the nine months ended July 1, 2011 and July 2, 2010 was approximately $143.9 million and $141.0 million, respectively.