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GOODWILL AND OTHER INTANGIBLE ASSETS
9 Months Ended
Sep. 30, 2013
GOODWILL AND OTHER INTANGIBLE ASSETS  
GOODWILL AND OTHER INTANGIBLE ASSETS

 

NOTE C — GOODWILL AND OTHER INTANGIBLE ASSETS

 

The Company completes its annual goodwill and indefinite lived intangible impairment analysis in the fourth quarter of each year. The Company has the option to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step quantitative goodwill impairment test.  If the Company determines that a two-step goodwill impairment test is necessary or more efficient than a qualitative approach, it will measure the fair value of the Company’s reporting units using a combination of income, market and cost approaches.  No triggering events have transpired since December 31, 2012.  Goodwill allocated to the Company’s operating segments for the nine months ended September 30, 2013 and for the year ended December 31, 2012 are as follows:

 

(In thousands)

 

Patient Care

 

Products &
Services

 

Total

 

Balance at December 31, 2012

 

$

538,492

 

$

136,282

 

$

674,774

 

Additions due to acquisitions

 

3,562

 

 

3,562

 

Adjustments

 

(121

)

 

(121

)

Balance at September 30, 2013

 

$

541,933

 

$

136,282

 

$

678,215

 

 

 

 

Patient Care

 

Products &
Services

 

Total

 

Balance at December 31, 2011

 

$

474,166

 

$

135,318

 

$

609,484

 

Additions due to acquisitions

 

63,849

 

964

 

64,813

 

Contingent considerations (1)

 

477

 

 

477

 

Balance at December 31, 2012

 

$

538,492

 

$

136,282

 

$

674,774

 

 

(1) Contingent considerations relates to acquisitions completed prior to the adoption of ASC 805.

 

The balances related to intangible assets as of September 30, 2013 and December 31, 2012 are as follows:

 

 

 

September 30, 2013

 

December 31, 2012

 

(In thousands)

 

Gross
Carrying
Amount

 

Accumulated
Amortization

 

Net
Carrying
Amount

 

Gross
Carrying
Amount

 

Accumulated
Amortization

 

Net
Carrying
Amount

 

Customer Lists

 

$

46,072

 

$

(10,628

)

$

35,444

 

$

48,044

 

$

(7,846

)

$

40,198

 

Trade Name

 

9,932

 

(197

)

9,735

 

9,070

 

 

9,070

 

Patents and Other Intangibles

 

28,241

 

(14,782

)

13,459

 

27,810

 

(12,797

)

15,013

 

 

 

$

84,245

 

$

(25,607

)

$

58,638

 

$

84,924

 

$

(20,643

)

$

64,281

 

 

Customer lists are amortized over their estimated period of benefit, generally 10 to 14 years.  The majority of value associated to trade names is identified as an indefinite lived intangible asset, which is assessed for impairment on an annual basis as discussed in Note B. Trade names not identified as an indefinite lived intangible asset are amortized over their estimated period of benefit of approximately 1 to 3 year.  Patents are amortized using the straight-line method over 5 years.  Total intangible amortization expenses were $5.0 million and $3.8 million for the nine months ended September 30, 2013 and September 30, 2012, respectively.  The weighted average life of the additions to customer lists, patents and other intangibles is 7.7 years.