Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

The changes in the carrying amount of goodwill for the nine months ended September 30, 2016, by reportable business segment, were as follows:



	Fluid & Metering Technologies			Health & Science Technologies			Fire & Safety/ Diversified Products		Total
Balance at December 31, 2015	$	584,770		$	590,605		$	221,154	$	1,396,529
Foreign currency translation	3,151			(4,820		)	1,638		(31		)
Acquisitions	—			132,381			147,823		280,204
Disposition of businesses	(3,594		)	(9,140		)	—		(12,734		)
Acquisition adjustments	(1,623		)	547			—		(1,076		)
Balance at September 30, 2016	$	582,704		$	709,573		$	370,615	$	1,662,892

ASC 350, Goodwill and Other Intangible Assets, requires that goodwill be tested for impairment at the reporting unit level on an annual basis and between annual tests if an event occurs, or circumstances change, that would more likely than not reduce the fair value of the reporting unit below its carrying value. Annually, on October 31, goodwill and other acquired intangible assets with indefinite lives are tested for impairment. Based on the results of our annual impairment test at October 31, 2015, all reporting units had a fair value that was more than 70% greater than the carrying value, except for our IDEX Optics and Photonics (“IOP”) and Valves reporting units. Our IOP reporting unit had a fair value that was approximately 20% in excess of the carrying value and our Valves reporting unit had a fair value near its carrying value as a result of the formation of this reporting unit in conjunction with our Alfa acquisition in June 2015. Due to the divestitures in the third quarter of 2016, the Company performed interim impairment tests at the Water and IOP reporting units. As a result of these interim impairment tests, the Company concluded that both reporting units had fair values in excess of their carrying values. The Water reporting unit had a fair value that was significantly in excess of its carrying value and the IOP reporting unit had a fair value that was approximately 20% in excess of its carrying value, both of which are consistent with our annual impairment test at October 31, 2015.

The following table provides the gross carrying value and accumulated amortization for each major class of intangible assets at September 30, 2016 and December 31, 2015:



	At September 30, 2016								At December 31, 2015
	Gross Carrying Amount		Accumulated Amortization			Net		Weighted Average Life	Gross Carrying Amount		Accumulated Amortization			Net
Amortized intangible assets:
Patents	$	10,180	$	(6,772	)	$	3,408	11	$	10,202	$	(6,175	)	$	4,027
Trade names	118,983		(42,190		)	76,793		16	110,658		(38,696		)	71,962
Customer relationships	384,141		(162,524		)	221,617		12	257,071		(144,134		)	112,937
Non-compete agreements	—		—			—		3	794		(775		)	19
Unpatented technology	117,455		(48,281		)	69,174		11	78,562		(42,745		)	35,817
Other	6,599		(6,061		)	538		10	6,554		(5,579		)	975
Total amortized intangible assets	637,358		(265,828		)	371,530			463,841		(238,104		)	225,737
Indefinite lived intangible assets:
Banjo trade name	62,100		—			62,100			62,100		—			62,100
Akron Brass trade name	28,800		—			28,800			—		—			—
Total intangible assets	$	728,258	$	(265,828	)	$	462,430		$	525,941	$	(238,104	)	$	287,837

The Banjo trade name is an indefinite lived intangible asset which is tested for impairment on an annual basis in accordance with ASC 350 or more frequently if events or changes in circumstances indicate that the asset might be impaired. In the first nine months of 2016, there were no triggering events or changes that would have required a review. Based on the results of our annual impairment test at October 31, 2015, the fair value of the Banjo trade name was greater than 20% in excess of the carrying value.

The Akron Brass trade name is an indefinite lived intangible asset that was generated as a result of the Akron Brass acquisition in March 2016 and it will be tested for impairment on an annual basis in accordance with ASC 350 or more frequently if events or changes in circumstances indicate that the asset might be impaired.

Amortization of intangible assets was $12.8 million and $11.2 million for the three months ended September 30, 2016 and 2015, respectively. Amortization of intangible assets was $28.4 million and $26.6 million for the nine months ended September 30, 2016 and 2015, respectively. Based on the intangible asset balances as of September 30, 2016, amortization expense is expected to approximate $14.0 million for the remaining three months of 2016, $40.3 million in 2017, $34.5 million in 2018, $33.0 million in 2019 and $32.2 million in 2020.

- 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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