GOODWILL AND INTANGIBLE ASSETS

12 Months Ended

Jan. 03, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL — The changes in the carrying amount of goodwill by segment are as follows:



(Millions of Dollars)	CDIY			Industrial			Security			Total
Balance December 28, 2013	$	2,951.2		$	2,026.0		$	2,585.5		$	7,562.7
Acquisition adjustments	24.5			48.9			1.1			74.5
Foreign currency translation and other	(99.0		)	(79.0		)	(183.7		)	(361.7		)
Balance January 3, 2014	$	2,876.7		$	1,995.9		$	2,402.9		$	7,275.5

As required by the Company's policy, goodwill and indefinite-lived trade names were tested for impairment in the third quarter of 2014. The Company assessed the fair values of two of its reporting units utilizing a discounted cash flow valuation model as had been done in previous years and determined that, for each of the two reporting units, the fair values exceeded the respective carrying amounts. The key assumptions used were discount rates and perpetual growth rates applied to cash flow projections. Also inherent in the discounted cash flow valuations were near-term revenue growth rates over the next five years. These assumptions contemplated business, market and overall economic conditions. The fair values of indefinite-lived trade names were also assessed using a discounted cash flow valuation model. The key assumptions used included discount rates, royalty rates and perpetual growth rates applied to projected sales.

For the remaining four reporting units, the Company determined qualitatively that it was not more-likely-than-not that goodwill was impaired, and thus, the two-step goodwill impairment test was not required. In making this determination, the Company considered the significant excess of fair value over carrying amount as calculated in the most recent quantitative analysis performed in conjunction with the 2012 annual impairment test, favorable results of the 2013 impairment test, positive 2014 industry performance versus prior year, analyst multiples and other positive qualitative information, all of which indicated that it is more-likely-than-not that the fair values of the four reporting units were greater than the respective carrying amounts. Based on this evaluation of internal and external qualitative factors, the Company concluded that the two-step goodwill impairment test was not required for these four reporting units.

INTANGIBLE ASSETS — Intangible assets at January 3, 2015 and December 28, 2013 were as follows:



	2014					2013
(Millions of Dollars)	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized Intangible Assets — Definite lives
Patents and copyrights	$	52.8	$	(43.9	)	$	56.3	$	(44.3	)
Trade names	165.7		(89.6		)	168.5		(79.4		)
Customer relationships	1,832.0		(893.1		)	1,947.2		(783.3		)
Other intangible assets	275.6		(140.3		)	281.0		(122.9		)
Total	$	2,326.1	$	(1,166.9	)	$	2,453.0	$	(1,029.9	)

Total indefinite-lived trade names are $1,592.5 million at January 3, 2015 and $1,614.2 million at December 28, 2013. The change in value is due to currency fluctuations.

Aggregate intangible assets amortization expense by segment was as follows:



(Millions of Dollars)	2014		2013		2012
CDIY	$	33.3	$	37.7	$	35.9
Industrial	73.8		74.0		58.3
Security	79.3		91.6		113.2
Consolidated	$	186.4	$	203.3	$	207.4

The amounts above are inclusive of amortization expense for discontinued operations amounting to $2.9 million in 2014 and $4.2 million in 2013 and $22.2 million in 2012.

Future amortization expense in each of the next five years amounts to $171.4 million for 2015, $158.1 million for 2016, $149.1 million for 2017, $139.6 million for 2018, $123.5 million for 2019 and $416.5 million thereafter.

- 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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